Tata Steel to Begin UK Electric Arc Furnace Project in July 2025

Tata Steel, as per news reports, plans to start construction of its Electric Arc Furnace (EAF) facility at Port Talbot, UK, in July 2025. Operations are expected to begin by 2027. The company confirmed in its FY2024-25 annual report that all necessary planning approvals have been received.

Project Value

The total estimated cost of the EAF project is $1.5 billion. Of this, £500 million will be provided by the UK government to support the company’s transition to low-emission steelmaking.

Closure of Old Operations

The company has shut down its blast furnace-based steelmaking operations at Port Talbot. These facilities had reached the end of their operational life. Following this, Tata Steel has shifted to a downstream model using imported substrate.

Tata Steel’s Current Model 

With steel production halted at Port Talbot, Tata Steel is currently supplying its UK customers using materials sourced from its operations in India, the Netherlands, and other external suppliers. The downstream facilities in the UK are still operational.

Cost Reduction Plan

Alongside the shift in production model, Tata Steel has outlined a plan to reduce fixed costs in the UK. In FY2024-25, fixed costs stood at £762 million. The company is targeting a reduction to £540 million in the upcoming financial year. Areas of focus include substrate cost optimisation, IT upgrades, rationalisation of downstream units, and lower corporate overheads.

The new EAF facility will rely on locally available scrap as the primary raw material. This is a shift from the previous blast furnace method, which depended on iron ore and coal.

Read more: Best Metal Stocks In India In June 2025!

Tata Steel Share Price Performance 

As of 09:53 AM on June 9, 2025, Tata Steel share price was trading at ₹157.37, a 0.07% decrease, with a 5.12% increase over the past 6 months and a 12.61% drop over the past year.

Conclusion

Tata Steel’s EAF project at Port Talbot is scheduled to begin construction in July 2025. In the meantime, the company continues to operate its UK downstream units and supply customers through imports, while also working to reduce operating costs.

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