Tata Steel UK has signed a memorandum of understanding for the first supply agreement for steel made in its planned electric arc furnace with construction equipment manufacturer JCB, Kallanish notes.

The two companies have signed an MoU for the supply of low-CO2 green steel from Port Talbot in South Wales once it completes its transformation plan to switch to a 3m tonnes/year EAF.

JCB, which maintains a close focus on carbon reduction in its manufacturing and equipment, will integrate the steel into its machinery range.

Wayne Asprey, group purchasing director at JCB, says: “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.”

The site will switch from blast furnace based steel as part of a £1.25 billion investment, assisted by £500 million of  UK Government funding.

The EAF will use domestically sourced scrap accounting for 75% of its raw materials, reducing emissions versus iron ore-based steelmaking, which saw 90% of inputs imported.

Anil Jhanji, chief commercial officer at Tata Steel UK, notes: “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.”

The transformation of the site is expected to start in summer 2025, with Tata Steel intending to make the UK site one of "Europe’s premier centres for green steelmaking”, the firm notes.

“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," Jhanji adds.