Tata Steel Expresses Concern at Uk Media Reports on Policy Differences Between the Uk Government and the Opposition on Its Transformation Plan

12 June 2024

The Company confirms that it will continue with the announced closure of the heavy-end assets and restructuring programme at Port Talbot in the coming months.

Over the last three years, Tata Steel, part of India’s Tata Group, one of the UK’s largest private sector investors, and the UK Government have worked hard to develop a sustainable future for Tata Steel UK and the Port Talbot Plant.

We are therefore apprehensive reading UK media reports suggesting that the £1.25 billion investment, the largest in many decades in British steelmaking, may be put in peril due to policy differences expressed by the Conservative and Labour parties, during the ongoing election period. We urge and request the current and the incoming government post-elections, to adhere to and safeguard the agreed terms of the £500 million package of support for the Electric Arc Furnace (EAF) project announced in September 2023. This project has been developed to ensure the production of low-emission high-quality steel in Port Talbot, preserving steelmaking in Britain and creating the potential for a future green manufacturing cluster in South Wales.

The current heavy-end assets of Port Talbot are nearing their end of life, are operationally unstable, and are resulting in unsustainable financial losses. The coke ovens, a critical facility for primary steelmaking, had to be closed in March 2024, as operations became infeasible and unsafe. Therefore, the Company is compelled to continue with its plans to decommission Blast Furnace #5 at the end of June, followed by the decommissioning of Blast Furnace #4 by the end of September. The downstream assets will continue to service customers by utilising imported semi-finished steel till the new EAF is built and commissioned.

In April, the Company completed an exhaustive 7-month process of national-level formal and informal consultations on all options with the Unions and concluded that the multi-union plan which involved continuity of Blast Furnace #4 through the transition is not technically, operationally, or financially viable, putting the EAF build at risk and delaying the transition by at least two years.

To mitigate the impact of the announced restructuring, a generous voluntary redundancy programme has been developed and is being offered to the impacted employees.

The proposed grant funding from the UK Government is ring-fenced for building the new EAF, which is critical to securing a long-term supply of steel for Tata Steel’s UK downstream assets and protecting 5000 jobs in various Tata Steel UK sites. It is not linked to the ongoing financial losses and the instability of the existing heavy-end assets, whose closure is now underway and immutable. We are therefore concerned with the UK media reports since yesterday as further political uncertainty on the timing and form of the grant will place the EAF project and the long-term future of steelmaking at Port Talbot at significant risk.

Disclaimer

Statements in this press release describing the Company’s performance may be “forward-looking statements” within the meaning of applicable securities laws and regulations. Actual results may differ materially from those directly or indirectly expressed, inferred, or implied. Important factors that could make a difference to the Company’s operations include, among others, economic conditions affecting demand/ supply and price conditions in the domestic and overseas markets in which the Company operates, changes in or due to the environment, Government regulations, laws, statutes, judicial pronouncements and/or other incidental factors.

For queries and information

Sarvesh Kumar,
Chief Corporate Communications, Tata Steel,
E-mail : [email protected]

About Tata Steel UK

  • Tata Steel group is among the top global steel companies with an annual crude steel capacity of 35 million tonnes per annum.
  • It is one of the world's most geographically diversified steel producers, with operations and commercial presence across the world.
  • The group recorded a consolidated turnover of around US$27.7 billion in the financial year ending March 31, 2024.
  • A Great Place to Work-CertifiedTM organisation, Tata Steel Limited, together with its subsidiaries, associates, and joint ventures, is spread across five continents with an employee base of over 77,000.
  • Tata Steel has announced its major sustainability objectives including Net Zero by 2045.
  • The Company has been on a multi-year digital-enabled business transformation journey intending to be the leader in ‘Digital Steel making by 2025’. The Company has received the World Economic Forum’s Global Lighthouse recognition for its Jamshedpur, Kalinganagar, and IJmuiden Plants.
  • Tata Steel aspires to have a 20% diverse workforce by 2025. The Company has been recognised with the World Economic Forum’s Global Diversity Equity & Inclusion Lighthouse 2023.
  • The Company has been a part of the DJSI Emerging Markets Index since 2012 and has been consistently ranked among the top 10 steel companies in the DJSI Corporate Sustainability Assessment since 2016.
  • Tata Steel’s Jamshedpur Plant is India’s first site to receive ResponsibleSteelTM Certification. Subsequently, its Kalinganagar and Meramandali plants have also received the certification. In India, Tata Steel now has more than 90% of its steel production from ResponsibleSteelTM certified sites.
  • Received Prime Minister’s Trophy for the best performing integrated steel plant for 2016-17, 2024 Steel Sustainability Champion recognition from worldsteel for seven years in a row, 2022 ‘Supplier Engagement Leader’ recognition by CDP, Top performer in Iron and Steel sector in Dun & Bradstreet's India's top 500 companies 2022, Ranked as the 2023 most valuable Mining and Metals brand in India by Brand Finance, ‘Most Ethical Company’ award 2021 from Ethisphere Institute, and ‘Best Corporate for Promotion of Sports’ recognition at the Sportstar Aces Awards 2024.
  • Received the 2023 ERM (Enterprise Risk Management) Award of Distinction at the RIMS ERM Conference 2023, ‘Masters of Risk’ - Metals & Mining Sector recognition at The India Risk Management Awards for the seventh consecutive year, and Award for Excellence in Financial Reporting FY20 from ICAI, among several others.

 

Source:tatasteel.com