TORONTO Energex Tube, a division of Chicago-based JMC Steel Group Inc., plans to permanently lay off 110 workers at its Welland, Ontario, facility effective July 15, a union official told AMM Friday.
The cuts, which will leave one shift running at Wellands 8-inch-diameter pipe mill, are necessary because of high inventory levels at the plant, a "glut" of pipe imports that drove down prices and "no customer demand," said Doug Orr, a national representative for the Canadian Auto Workers (CAW) union, which represents workers at the Welland operations.
The 8-inch mill only has one customer, and that is "expected to dry up by years end," Orr said. "The previous ownership ran a business model that always had the plant running full-out, which wasnt sustainable. The new ownership group demands specific margins of profits as well as firm orders before they produce pipe."
JMC announced April 3 that it had completed its acquisition of the former Lakeside Steel Inc. At the time, the company also announced plans to combine its own energy tubular assets with those of the former Lakeside to form a new division called Energex Tube.
JMC assumed responsibility for Lakesides facilities in Thomasville, Ala., and Corpus Christi, Texas, as well as its Welland operations (AMM, April 5).
There are 352 workers at Energexs Welland facility, Orr said in e-mails to AMM.
Energex Tube didnt respond to requests for comment.