Construction equipment giant JCB has signed a memorandum of understanding for the supply of low-carbon steel from Tata Steel’s Port Talbot plant.

At the end of last year, the UK government struck a deal with Tata Steel to invest £500m in the Port Talbot plant to help it transition over to electric arc furnaces (EAFs).

This will replace the existing coal-powered blast furnaces and in the process cut the site’s CO₂ emissions by up to 90% and the UK’s overall carbon emissions by about 1.5%.

An EAF uses an electric current to melt scrap steel or iron to produce new high-quality steel, whereas blast furnaces use coke – a carbon-intensive fuel made from coal – to produce steel.

The new deal with JCB marks the first supply agreement Tata Steel UK has made since announcing its transition to using EAFs for low-carbon steel production.

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...