The plant has been losing money since 2008 and specialises in the manufacture of floor decking and highways parapets.

Tata chiefs blamed the move on the slow recovery in the construction market and a dive in public spending.

Paul Steele, Tata Steel’s Managing Director for Distribution UK & Ireland, said: “It is with great regret that, following a detailed review of the business, we have proposed to cease operations at Construction Products.

“Clearly this is a very difficult time for the people who work for the business and I would like to pay tribute to everyone who has tried so hard to enable this business, which has operated at a consistent loss since 2008, to overcome the continuing economic downturn.

“The business focuses on floor decking systems, highways barrier systems for roads and parapets, and also lightweight frames for a variety of applications.

“CP’s product 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.

“Our markets are highly competitive. On two occasions recently the Company has attempted to address the business’s challenges by restructuring it to focus on new and developing markets.

“These have included safety platforms for protecting people handling freight and also solar array structures.

“Despite these efforts, most reluctantly, we have come to the conclusion that there are no prospects of generating sufficient viable new business to sustain this operation.”

Tata will try to redeploy workers in other divisions and the closure does not concern any of the other manufacturing operations based at Llanwern.