Tata Steel Europe, a subsidiary of the India-based steel giant, has announced that it will mothball the hot strip mill at its Llanwern site in Newport, South Wales, due to continuing poor UK steel demand and also the worsening European economic outlook.
Tata Steel stated that the facility is expected to remain mothballed until the economic environment and steel demand start to recover. In the meantime, Tata Steel will continue to supply the market from its other hot strip mill in South Wales at Port Talbot, whose costs are lower. The cold rolling mill and ‘Zodiac' galvanizing line at Llanwern will remain in operation.
However, 115 jobs will be cut at the Llanwern site, affecting fixed-term contract employees, agency workers and contractors. The company will carry out a 30-day consultation process with the employees and their representatives.
According to the company statement, Tata Steel is carrying out a major capital expenditure project to rebuild Port Talbot's Blast Furnace No. 4, while focusing on cost-saving measures.