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Monday, April 4, 2016

Tata closure to tear hole in UK supply chain

The closure of Tata Steel’s operations in Britain would leave a hole in manufacturers’ supply chains, dealing a blow to thousands of smaller firms across the country and creating a logistical headache for the car industry.

India’s Tata Steel, Britain’s biggest producer, put all of its operations up for sale, including the country’s largest steelworks at Port Talbot which is losing $1.4 million a day due to depressed steel prices and high costs.

As the government searches for a new buyer, some of Tata’s customers are already looking for new sources of steel which is used in everything from car roofs to Heinz baked bean cans, cladding on Ikea buildings and some of the country’s coins.

While bigger names have the luxury of a global supply chain to fall back on, smaller companies — which account for around 95 per cent of British manufacturing firms — face a tougher task if Port Talbot in south Wales closes.

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