Nov. 23 (Bloomberg) -- Tata Steel Ltd., India’s biggest producer of the metal, said it plans to restructure its U.K. business, cutting 900 jobs and closing 12 sites as the steel industry battles overcapacity and slumping demand.
The cuts will include the loss of 580 jobs and the closure of its Tafarnaubach and Cross Keys plants in South Wales, the company said in a statement today. Further jobs will go in England’s Yorkshire, West Midlands and Teesside regions.
“Today’s proposals are part of a strategy to transform ourselves into an all-weather steel producer, capable of succeeding in difficult economic conditions,” Karl Kohler, Chief Executive Officer of Tata Steel’s European operations, said in the statement.
Steel-industry earnings have slumped as Europe’s economic crisis saps demand and slower Chinese growth weighs on commodity prices. ArcelorMittal, the world’s biggest producer, reported the lowest quarterly profit in almost three years last month and is moving output to cheaper sites and idling plants.
Tata Steel posted an unexpected second-quarter loss on Nov. 9 as weak demand in Europe and China cut prices and costs rose. Tata Steel bought Corus in 2007 for $12.9 billion, gaining steelmaking sites in the U.K. and the Netherlands.
Prices for hot-rolled steel coil, a benchmark product used in vehicles and buildings, averaged about $624 a ton in the third quarter, down from $764 a ton a year earlier, according to Steel Business Briefing’s global price index.
To contact the reporter on this story: Thomas Biesheuvel in London at firstname.lastname@example.org
To contact the editor responsible for this story: John Viljoen at email@example.com