Tata Steel and JCB sign ‘green’ steel deal

Companies sign Memorandum of Understanding for supply of low-CO₂ steel from Port Talbot 

TATA Steel UK and JCB have signed a Memorandum of Understanding (MoU) 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 after completing their transformation plans. JCB, who maintain a close focus on carbon reduction in their manufacturing and equipment, will integrate the steel into their machinery range.

This is the first supply agreement Tata Steel UK have made since announcing the £1.25 billion joint investment with the UK Government to transition to high-quality, low-CO₂ steel production in South Wales.

The project includes building a new 3-million-tonnes-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 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% and the UK’s overall carbon emissions by about 1.5%.

Anil Jhanji, chief commercial officer of 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 decarbonization 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 decarbonization. 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.’

Tata Steel signed a contract with Tenova in October 2024 to deliver a state-of-the-art electric arc furnace and additional advanced steelmaking equipment for their Port Talbot site. The transformation of the site is expected to start in summer 2025.

Tata Steel intend to make Port Talbot one of Europe’s premier centres for green steelmaking. The £1.25 billion investment, which includes a UK Government grant of up to £500 million, 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.