NEW YORK U.S. Steel Corp.s Lake Erie Works intends to lock out unionized workers at 9 a.m. April 28 as labor negotiations between the two parties have failed.
The Pittsburgh-based steelmaker gave a 72-hour lockout notice to the United Steelworkers union in a letter dated April 25.
Union members overwhelmingly rejected the companys proposed contract a day earlier (amm.com, April 24). The previous contract expired April 16.
Neither a spokesman for the company nor union officials could be reached for comment, although a notice from USW Local 8782 indicated that members would start a picket line.
Negotiations between the two parties heated up after the union claimed that the company had been training salaried, nonunion workers to operate its hot-strip mill, including rolling slabs, at the Nanticoke, Ontario-based mill, raising speculation of a lockout (amm.com, April 8).
However, market participants said a lockout might not have much impact on the industry, even if production is affected, citing overcapacity issues in the sheet market.
"I dont think the impact will ultimately mean anything. Theyll find other ways to supply their business. Even with a lockout, no one said anything about shutting down production," one trader said. "The market impact overall? Zero."
According to Charles Bradford, president of New York-based Bradford Research Inc., the steelmakers Hamilton Works in Ontario would be affected by a disruption at Lake Erie, as Hamilton doesnt have a hot-strip mill.
"My guess is that theres extra inventory around, so a lockout wouldnt impact the market immediately," he told AMM, adding that if production went offline at Lake Erie Works it wouldnt be enough to change the oversupply situation in the market.
A lockout during the last set of contract negotiations at Lake Erie Works lasted eight months before the two sides reached a three-year deal (amm.com, April 16, 2010).