Tata Steel to close Welsh construction products unit

Tata Steel , the world's No. 7 steelmaker, will close its construction products business in South Wales due to weak activity in UK construction and public procurement, it said on Friday.

The construction products business, based at the Llanwern site in Newport, currently employs 70 people and focuses on production of highways barrier systems for roads, parapets, floor-decking systems and lightweight frames for a variety of applications.

"It is with great regret that, following a detailed review of the Tata Steel Construction Products business, we have proposed to cease operations," Paul Steele, Tata Steel's managing director for distribution UK & Ireland, said in a statement.

"Construction Products's range is sold to the construction industry, which has not recovered well from the financial crisis, and to market areas dependent on public procurement activity, which has also been severely affected by the long-running economic downturn."

The business has operated at a consistent loss since 2008 and was unable to overcome the continuing economic downturn, Tata said.

Last month, the CEO of Tata Steel in Europe said the company might cut steel production further in the region in the next few months if steel orders weaken.

It had already cut production to 80-85 percent of its annual capacity of 18 million tonnes from 85-90 percent in the first half of this year, it said.