CHICAGO Unionized workers
at Globe Specialty Metals Inc.s facility in Becancour,
Quebec, are bracing for a strike or lockout after receiving the
companys final contract offer April 17, which a union
official called unacceptable.
The New York-based silicon metal
producer is seeking deep cuts at its Becancour operation as it
looks to make the facility cost-competitive with other company
plants, Communications, Energy and Paperworkers Union of Canada
(CEP) official René Gauthier told AMM.
While the companys
proposed cuts are "too profound," the New York-based silicon
producer does not appear inclined to negotiate, said Gauthier,
who disputed Globes calculations about production costs
at Becancour. Gauthier said such factors as tax rates and
different currencies had not been properly taken into
Globes five-year contract
with CEP Local 18, which represents about 150 workers at the
Becancour facility, expires April 30 (
amm.com, March 12). "The first of May, they are
going to put us outside," Gauthier said.
The union does not want to
strike, but "99 percent" of union members are prepared to vote
for one if necessary, Gauthier said, noting that Globes
proposed cuts would hit not only union workers but also
salaried workers, and would bite into insurance and pension
"The company has given the union
an offer, which is in line with its business objective, and
hopes it can reach an agreement with the union," a source at
Gauthier contended that
production from the plant was sold out. But one market source
said the impact of any labor disruption at Becancour on the
wider silicon metal market might be muted, especially given the
current sluggish market. As much as two-thirds of the silicon
metal production at the facility could be shifted to
Globes furnaces in Beverly, Ohio, he said.
Globe cut some 12,000 tonnes of
silicon output in July 2011 after converting one of two silicon
furnaces at Beverly to ferrosilicon (
amm.com, July 7, 2011). The second furnace in
Beverly is currently down for maintenance, the source said.
"They could put both of those
(Beverly furnaces) on silicon metal, and it really
wouldnt be taking that much metal off the market," he
added, noting that the silicon furnace could be brought back up
relatively quickly and that switching the ferrosilicon furnace
to silicon metal production would not be too difficult.
Globe has scheduled three
maintenance outages in its fiscal third quarter and three in
its fiscal fourth quarter (
amm.com, Feb. 8).
Market sources said that while
making strict comparisons between costs in Quebec and costs in
Ohio might not be reasonable, the Canadian dollar is currently
stronger than it has been historically against the U.S. dollar.
Staffing in Quebec is roughly twice what it might be in the
United States, while wages and benefits there also are more
Globe holds a majority stake in
the facility, which has an annual capacity of 47,000 tonnes of
silicon, with Dow Corning Corp. holding a 49-percent share (
amm.com, Aug. 21).
Dow Corning, Midland, Mich.,
declined to comment.