NEW YORK U.S.
Steel Corp. and unionized workers at its Lake Erie Works have
reached a five-year labor deal, effectively ending an 18-week
lockout, the union said.
union Local 8782 saw 79 percent of its membership turn out for
the Aug. 30 vote, with 57 percent accepting the contract offer,
according to the unions website.
The vote came just
weeks after union members rejected an offer from the
Pittsburgh-based steelmaker (
amm.com, Aug. 1).
While the new
agreement hasnt been made official, a memorandum set in
place has allowed locked-out workers to start receiving
mandatory two-day safety training, with operations resuming
immediately, Local 8782 president Bill Ferguson told
"Were in the
midst of a recall for everyone to the plant to get a two-day
safety refresher," he said. "Then, were anticipating a
U.S. Steel is "pleased
to be in a position to begin the recall of our work force in
the coming days," and expects employees to return to work
within the next 30 days, a company spokesman told AMM
via e-mail. "While it is unfortunate that circumstances led
both parties into this labor dispute, we are pleased that we
are emerging with a fair contract that will help to make Lake
Erie Works sustainable and competitive in both the Canadian and
global marketplace for the next five years."
The lockout, which
began when both parties failed to reach a compromise following
the April 28 expiration of an existing three-year contract,
affected some 1,000 unionized workers at the Nanticoke,
Ontario, facility (
amm.com, April 29).
Approval of the deal
came days before Mario Longhi assumed the top spot at U.S.
Steel. Ferguson hopes this will mean a renewed relationship
between the company and the union.
"At the end of the
day, this thing has gone on for four months already. Our hope
is that if the product mix is good, if were doing
high-end automotive steel and address the market that way then
everyone can make money," Ferguson said.
The union told members
last week that if the latest proposal were approved, it would
take three weeks to finish the existing reline of the blast
furnace and start production (
amm.com, Aug. 29), with the hot-strip mill
resuming operations "as quickly as possible."
While the blast
furnace would take weeks to restart, putting supply back into
the sheet market will depend on how much slab inventory the
company has held, Charles Bradford, analyst at New York-based
Bradford Research Inc., pointed out. If there are slabs already
on the ground, then the market will start receiving those extra
However, a restart
would have little effect on spot prices in the near term, he
"I dont think
theyre going to try to get back into the market very
quickly," Bradford said. "Itll be a slow process. U.S.
Steel hasnt been a big aggressor when it comes to spot
With a number of
outages in the fourth quarter, including Nucor Corp.s
Berkeley upgrade and ArcelorMittals Cleveland outage, the
sheet market might hold out for a while longer.
Others agreed, noting
that the outages slated for the final few months of the year
should bring some near-term stability to the sheet market.
"Foreign isnt a
factor anymore," one trader said. "I think for Lake Erie,
obviously, itll supply some steel back in the market. But
itll take time for them to get it up and running, so I
dont see any major collapses for the moment."