Corus raises production cuts to 30 per cent; axes 400 jobs

08 November 2008

Just after the world's largest steel maker, ArcelorMittal, said it was cutting production by a whopping 35 per cent due to a slowdown in the construction and automobile industries (See: Slowdown forces ArcelorMittal to cut output by up to 35 per cent ), Tata Steel's Corus Plc, Europe's second-largest steel company yesterday said that it would cut production by 30 per cent over the next six months and temporarily shut down three blast furnaces. 

Earlier this month Corus had announced 400 job cuts to align its production with a demand slowdown in Europe, caused by the global economic downturn, in its distribution and building systems division in its units at Shotton, Wolverhampton, South Wales and Leeds. Corus employs 2,400 people at 36 sites in Britain and Ireland.

On 29 October Corus International, the supply chain management arm of Corus, announced it had opened a new sales office in Sofia, Bulgaria and invested in two new facilities in North Wales, which it had said were with the most automated and efficient production line in Europe. The new lines are capable of producing 1 million m2 per year of composite panel cladding for the construction sector.

The move to cut jobs follows previous measures by Corus to reduce expenditure on transport, consumables, energy and other costs.

The 30 per cent cut in production to the end of next March comes after it announced last month that it would reduce production 1 million tonnes or by 20 per cent between October and December by a million tonnes of crude steel. (See: Tata cuts steel output at Corus)

Corus has now decided to extend the production cuts beyond December. Corus expects to produce about 30 per cent less crude steel than planned during the two quarters to the end of March 2009.