3 minute read - 17th December 2024
Tata Steel and JCB sign green steel deal
Tata Steel UK and JCB have signed a Memorandum of Understanding for the supply of low CO2 (green) steel. Under the agreement, Tata Steel will supply the British construction equipment manufacturer with green steel from Port Talbot once its transformation plans are complete. JCB, which maintains a close focus on carbon reduction in its manufacturing and equipment, will integrate the steel into its machinery range.
This is the first supply agreement Tata Steel UK has made since announcing the £1.25bn joint investment with the UK government to transition to high-quality, low-CO2 steel production in South Wales. The project includes building a new three million tonne per year state-of-the-art electric arc furnace (EAF)—one of the largest in the world—offering a lower-CO2 alternative to the traditional blast furnace method. The transformation of the site is expected to start in summer 2025.
The EAF will turn UK-sourced scrap into new high-quality steel, removing the need to ship millions of tonnes of iron ore and coal from across the world. Tata Steel’s plans will cut the site’s CO2 emissions by up to 90 per cent and the UK’s overall carbon emissions by about 1.5 per cent.
Tata Steel will supply JCB with green steel from Port Talbot after completing its transformation plans / Picture: Tata Steel
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Anil Jhanji, chief commercial officer at Tata Steel UK, said: “One of the key drivers in our transition plans is that our long-standing and loyal customers such as JCB need green steel to meet their own decarbonisation ambitions. They want to be supplied by a trusted partner making quality steel within the UK. This announcement that two of the UK’s largest manufacturers are working together to create a low-carbon supply chain is an important step in the UK’s transition to a circular economy.”
Wayne Asprey, group purchasing director at JCB, added: “Tata Steel is a long-term supply partner for JCB and this agreement marks an essential next step in our journey towards supply chain decarbonisation. We are fully supportive of Tata Steel UK’s investment proposals and are pleased to be one of the first customers to endorse those plans by making this agreement to secure British-made green steel as soon as it is available.”
JCB has led the way in decarbonisation in its industry, starting with its Road to Zero programme in 2010. It has achieved many industry milestones, such as developing the first-ever electric mini-digger in 2018, creating the first hydrogen-powered machine in 2021 and continuously expanding its range of fully electric-powered equipment. It is currently putting the world’s first construction machines powered by hydrogen combustion engines through rigorous testing.
JCB says the deal supports its focus on carbon reduction in its manufacturing and equipment, and will integrate the steel into its machinery range / Picture: Tata Steel
Tata Steel signed a contract in October 2024 with Tenova to deliver a state-of-the-art electric arc furnace and additional advanced steelmaking equipment for its Port Talbot site.
Tata Steel intends to make Port Talbot one of Europe’s premier centres for green steelmaking. The £1.25bn investment, which includes a UK government grant of up to £500m, is the largest capital expenditure investment in UK steel production for decades. Seventy-five per cent of the raw materials required will be sourced from the UK, up from 10% today, helping to maintain the country’s self-sufficiency in steel and making steel production more resilient to global events.
