Tata Steel has confirmed that almost 1,200 jobs will be lost at two of its plants in Scunthorpe and Lanarkshire as the UK steel industry continues to suffer from a price collapse.
The company says 900 jobs will go from its Scunthorpe site, with the remaining 270 jobs to be cut from its location in Scotland.
Cheap imports from China are being blamed for the reduction in steel prices, with a number of firms suffering as a result. Up to 1,800 jobs are at risk at Caparo Industries after PricewaterhouseCoopers took charge of 16 out of 20 units within the group.
Tata Steel says its decision comes in response to “a shift in market conditions caused by a flood of cheap imports, particularly from China” as well as high electricity costs and a strong pound.
The company will ‘mothball’ steel plate mills in Scunthorpe, Dalzell and Clydebridge while one of the two coke ovens at the Scunthorpe steelworks will also be closed.
Karl Koehler, chief executive of Tata Steel’s European operations, said: “I realise how distressing this news will be for all those affected. We have looked at all other options before proposing these changes.
“We will work closely with affected employees and their trade union representatives. We will look to redeploy employees, wherever possible, and minimise employee hardship.
“The UK steel industry is struggling for survival in the face of extremely challenging market conditions. This industry has a crucial role to play in rebalancing the UK economy, but we need a fairer system to encourage growth. The European Commission needs to do much more to deal with unfairly traded imports – inaction threatens the future of the entire European steel industry.”
The company added it will now concentrate on higher-value markets with a focus on developing stronger and lighter products for its customers.
The announcement follows the loss of over 2,000 jobs at Redcar, which were also thought to be a result of cheap Chinese exports.
Prime Minister David Cameron has said he will raise the issue of the steel crisis with Chinese President Xi Jinping, who arrived in the UK yesterday (October 20) for a state visit.
