Steel Industry News

Hey, U.S. Steel----Canada is NOT Home Sweet Home; posted June 20

Bad news U.S. Steel: this isn't America. Big corporations have become untouchable, almighty monoliths to capitalism down south, where boatloads of money allows you to do pretty much whatever you want. But the rules are a little different here in Canada. In America, land of the free market and home of the brave investors, companies bend and even break the rules at will, with no repercussions. AIG executives take government bailout money and go on vacation: BP spills millions of gallons into the Gulf of Mexico and blames every independent contractor they can find instead of cleaning up the mess. There may be a public outcry while the atrocities are being committed, but the worst actual punishment these companies receive is a stern late night tongue-lashing from Jon Stewart……more

ThyssenKrupp Steel USA to Produce Hot Rolled Steel In July at First New Full Scale Steel Mill in U.S. since 1960's; Posted June 20

Steel Market Update spoke with ThyssenKrupp Steel USA earlier this week regarding when the new U.S. mill would begin rolling their first hot rolled coils. The following is from our article in our Steel Market Update newsletter published earlier this week:

 If you are an old-timer or just love steel mills you can’t be but excited…

 You can hear it in their voices. The excitement, the anticipation and the nervous energy that comes with bringing up the first new full scale mill in the United States since Burns Harbor was brought up by Bethlehem Steel in the 1960’s......more

Three Natural Gas Related Explosions Fuels Debate Over Gas Production; June 10

On June 3 a well blew out in Pennsylvania causing state officials to call a temporary halt to drilling by EOG Resources.  Another well being drilled in West Virginia exploded late Saturday night, burning seven workers and a big natural gas pipeline in North Texas exploded Monday injuring several people.

Natural gas operations have expanded rapidly in Texas, Louisiana, Pennsylvania and other states in recent years as energy companies started using new techniques to drill for gas trapped in undergound rock formations called shales.  But some residents have become increasingly concerned about the risks associated with gas drilling as some regulators have linked drilling to several cases of drinking water contamination.  (THIS NATURAL GAS DRILLING HAS CREATED A LARGE VOLUME OF ORDERS FOR US AT GRANITE CITY WORKS-so stay tuned.)

Severstal to idle parts of Sparrows Point mill; posted June 9

The company that operates Sparrows Point steel mill announced that it will be temporarily shutting down portions of the plant, and workers report that the company is bringing in slabs from Russia, potentially violating a union labor agreement. Citing weakening market conditions, Severstal expects to shut down several of its Sparrows Point operations at the end of the month, company spokeswoman Elizabeth Kovach said Monday. “The affected facilities include iron-making, steel-making and continuous casting,” Kovach wrote in an e-mail. That includes the plant’s L blast furnace, which produces slab from raw ingredients. The shutdown is expected to last about one month, Kovach said. About 600 people work at those facilities, but the exact number of layoffs has not been determined, Kovach said.

Citigroup analysts identified Sparrows Point as Severstal’s highest-cost plant with first-quarter hot rolled coil costs of more than $700 per ton, according to a Reuters report.

    Severstal said demand was up almost 14 percent in its North American operations in the first quarter of this year, but cited high raw materials costs and “excessive operating and maintenance costs related to weather influenced production interruptions at Sparrows Point” in a financial report available on the company’s website.    Kovach said the company would not comment on the use of Russian slabs.        

 

 

Steelmakers Surging Production Puts Downward Pressure on Prices as Inventories Rise; Wall St. Journal June 1

The world's steel mills are ramping up production so quickly that prices in some markets are expected to fall 5% or more in June, and inventories are growing.  Mills in China, the biggest driver in steel prices, and Eastern Europe are churning out record amounts of steel. 

"The possibility of over production in the market is a concern," said Lakshi Mittal, chief exec. of Arcelor/Mittal, the world's largest steelmaker.  They are weeding out its less-efficient operations.  The company is shutting down two blast furnaces in Indiana and restarting a larger one in that state in an effort to centralize production and lower costs.

Chinese finished steel exports tripled in April from a year earlier as pricing begins to crack for them domestically. With the prospect of too much supply hitting the market some steel buyers are delaying orders in expectation of falling prices.

ArcelorMittal Burns Harbor IndianaTaking Down 2 Blast Furnaces & Bringing 1 Back Online; Steel Market Update May 25

In an effort to “lower costs” an ArcelorMittal spokesperson has advised Steel Market Update of their intention to “take offline” or idle two blast furnaces at their Indiana Harbor facility. At the same time they will bring up a large blast furnace – the “D” furnace at Burns Harbor.

The AMUSA spokesperson told SMU: “ArcelorMittal will be taking Indiana Harbor blast furnaces 5 and 6 off line and will serve market demand with lower cost capacity available by restarting ArcelorMittal Burns Harbor D furnace. This configuration will enhance our production flexibility resulting in more consistent customer satisfaction and aligns with our continuous improvement objectives. The ArcelorMittal spokesperson also told us: “We are not anticipating layoffs at this time and are exploring all options to maintain employment levels.”

An article in the American Metal Market reported all work has ceased on the rebuild of the #3 blast furnace at Indiana Harbor. According to SMU blast furnace data if the #3 furnace would have come back online it would have added additional raw steel capacity of 4,500 tons per day. With #5 and #6 being brought down at the same time as the “D” furnace comes back online at Burns Harbor, AMUSA is taking down 10,000 tons of capacity while adding 7,400 tons at Burns Harbor.

SMU is checking with ArcelorMittal in Hamilton (Canada) as they have been rebuilding their #3 furnace which was expected to come back online this summer. If it does this will add raw steel capacity of 2,500 tons per day. Between the two furnaces – “D” at Burns Harbor and #3 at Hamilton – they will effectively replace the two furnaces being taken down. Our sources have advised Steel Market Update the ArcelorMittal mills are one of the beneficiaries of the loss of GM business at AK Steel. This would mean a larger amount of tonnage would need to be run on AM automotive lines – especially at Burns Harbor and potentially at Hamilton.

Steel Mills Asked to Pay 23% More for Iron Ore in 3rd Quarter; May 25

STEEL MARKET UPDATE; Chinese steel mills have expressed their reluctance to accept iron ore prices of potentially 160 U.S. dollars per ton proposed by Vale and BHP in the third quarter, saying that the price hike will create carnage in the nation's steel industry. "BHP has recently informed us that they will raise third quarter iron ore prices, including freight, to 160 U.S. dollars a ton, which is unacceptable for us," according to an official from a large steel mill in northern China, adding that the request from the miner was "tentative" to test the market. "We will become unprofitable with such prices on the back of a persistent fall in steel prices," the source said. Wuhan Iron and Steel also received notice from Vale, the world's largest miner of the mineral, on Tuesday to pay 160 U.S. dollars for iron ore in the third quarter. The price is approximately 23 percent higher than that in the second quarter. Brazilian Vale and BHP, the world's third-largest exporter of the mineral, ended a 40-year tradition of annual benchmark prices with Asia mills this year by signing quarterly contracts, in which miners will benefit significantly from rising spot prices for iron ore trading at more than double the annual price. Yet after the government issued policies to crack down on the sizzling property market early this year, domestic steel prices have undergone steep drops on retreating domestic demand and mounting inventories. Mysteel's composite steel price index has accumulatively lost 7.86 percent in a month to close at 155.9 points on Wednesday. But most medium- and small-sized steel manufactures have yet to receive any information on the price increase. "We heard rumors about the price hike, but haven't been informed by the miners," said a sales executive from a medium-sized steel mill based in Hebei province, adding that the price is unreasonable give the steep slump in iron ore prices in recent weeks. "It will be too expensive to afford." The spot price of 63.5 percent-content iron ore imports to China was between 160 U.S. dollars and 163 U.S. dollars per ton on Thursday, down from April's 190 U.S. dollars per ton, according to Umetal.com. "We will see a complete loss in the steel industry if the much-talked-about price is inked, and most small-sized mills will go bankrupt," said Chu Xueliang, an analyst at China Jianyin Investment Securities. According to Chu, domestic steel mill's pays around 4,100 yuan (600 U.S. dollars) per ton when the iron ore price stays at 110 U.S. dollars per ton. That price will climb to around 4,620 yuan per ton if the mineral's price is set at 160 U.S. dollars per ton. At present, steel manufacturers sell to steel traders wholesale for between 4,200 yuan to 4,800 yuan per ton. "We estimate that the acceptable price for Chinese steel mills is around 130 U.S. dollars per ton in the third quarter," Chu said. (Source: China.org.cn)

Steel Price Correction Could be Healthy for U.S. Steel Market John Packard Steel Market Update: May 17, 2010

 As Steel Market Update has been reporting for some time, steel prices have reached a plateau, and there are even some signs of easing. This is clearly evident in the US, especially on the flat rolled side, but also in many areas overseas, including China. The interesting thing about this is that while the coil producers were still dancing in the streets and singing the praise of the automotive revival, the North American tubers were not sharing their joy, because they had been facing increasing resistance and push back from their customers for some time, mainly because demand clearly was lagging the breakneck speed of past price increases. For the record, it is not an unusual pattern for the increase to go up the value chain and then to see the pattern reversed when prices come down.

This is probably the longest we have gone in a while without an increase for mechanical and structural tubing or standard pipe, and it also appears that even in the OCTG sector, prices are taking a breather.

The huge vacuum left by the Chinese dumping suit-induced exit from the US market is apparently being filled faster than most people would have thought. Prices especially for mid range casing in the carbon grades had gotten ahead of themselves and the most ambitious numbers are going through a correction.

Now comes the hard part - where do we go from here?

Anybody who has been in this business for longer than a couple of months knows that prices never seem to go side-ways for very long. So, is the next move going to be up or down? Once again, I have to take the contrarian (in this case optimistic) view and state my believe that after bouncing around in a narrow band for a little while, prices will start moving up again, probably around the end of the summer.

Why? Because by that time, demand in this country will have come up nicely, and our market will have absorbed the additional hot metal from the three restarted blast furnaces - via exports if necessary. The Greek drama will be forgotten, the Euro will have recovered (with the resultant cheaper dollar facilitating those exports), and the Chinese will have loosened credit a bit, because they have to, if only to counter-act the newly appreciating RMB.

Will all be well? No, because there still will be greed-induced price volatility up and down the supply chain (I did not think I would ever say that), but all of this will play out on much stronger legs.

Deindustrialization in America Disipating Wealth While Building Kabul and Baghdad-Manufacturing and Technology News

Dozens of American cities throughout the industrial Great Lakes states and Midwest have lost half of their populations over the course of one generation -- places like Cleveland, Youngstown, Detroit, Warren, Buffalo and Flint. This is the first time that so many cities have lost half of their populations in such a short amount of time since the Plague struck Europe in 1348, according to Hunter Morrison, director of Youngstown State University's Office of Planning and Partnerships.

America is more interested in building Baghdad and Kabul than it is in assuring the viability of its own cities. "I grew up in Cleveland," says Morrison. "It is disheartening. There is a lot of energy, hope and faith. But it's disheartening. It's like having diabetes or lupus. It's a chronic condition that never seems to get better. You take one step forward and two steps back. If there are going to be another 100 million people in this country by 2050 and they are all going to the coasts and Florida, how are those places going to accommodate that growth in fragile ecosystems? You have to step back and ask if it is in the national interest to continue to pump more people into a place like Florida to accommodate that growth." What needs to be done to turn the situation around? "A way to address a problem is to recognize that you have one," says Morrison. "It's not Cleveland's problem or Elyria's problem. It's not saving Cleveland. It's the way we operate as a nation -- a nation of places. What has been brought to the table is that deindustrialization is something that is good because it is cleaner. But it is nothing of the sort. It is a diminution of wealth creation. If deindustrialization was such a good thing, then why is China industrializing? The reason you do manufacturing is to create wealth by adding value. It's real simple. We've gone away from that."

Manufacturing and Technology News for the rest of the story and many more excellent Richard McCormick writings

US Postpones China Currency Manipulator Decision; April 6

American Iron and Steel Institute AISI President and CEO Thomas J. Gibson issued the following statement regarding the Obama Administration’s announcement that it would delay a decision on whether to declare China a currency manipulator, which had been expected by April 15. “AISI is disappointed that U.S. Treasury Secretary Timothy F. Geithner has once again side-stepped his obligation to address China’s currency manipulation as mandated by law. The Congress directed Treasury to issue a report twice a year identifying those countries manipulating their currencies in order to allow for orderly negotiations to address this unfair trade practice. In the case of China, there is a broad consensus among economists that China is acting to artificially suppress the value of its currency, giving an effective export subsidy to Chinese goods in markets around the world and putting U.S. exports at an unfair competitive disadvantage. Yet, Treasury has repeatedly refused to identify China as a currency manipulator. Acknowledging this consensus view would allow for honest negotiations with the Chinese government to remove this significant impediment to U.S. exports and create needed jobs in this country. The Administration needs to act now to make it clear to China that the status quo is unacceptable. In accordance with existing statutory requirements, the Treasury Department should be moving forward now on serious negotiations with China, and the Commerce Department should be treating Chinese currency policy for what it is – an export subsidy that is subject to countervailing duty law. At the same time, the Congress should enact as soon as possible an effective trade remedy tool to deal with this problem of fundamental currency misalignment. American manufacturers and their workers are being injured by this unfair practice. We cannot continue to give China and other governments a pass on this critical issue.”

Mini Mills Now High Cost Producer; posted March 22

FROM STEEL MARKET UPDATE: An analyst pointed out to SMU, “Nucor buys 3 million tons of pig iron in a normal year (not 2009) and this material largely from Brazil is substantially cheaper than the blast furnace output of the U.S. integrated mills. Another point, with a blend of scrap bundles and shredded needed for flat rolled steel, now costing over $400 a gross ton, the U.S. mini-mills are now high cost steelmakers. With scrap at this price level and maybe going up further in April, EAF mini-mills total operating costs are between $525 and $550 a net ton, which compares to less than $500 per net ton in China and Brazil.”

ANOTHER STEEL MARKET UPDATE: The following mills purchase slabs on the international market as they do not have melting capabilities: California Steel, Oregon Steel, JSW & Duferco Farrell. To the list you need to add AK Steel as they can roll more than they can melt. AK Steel recently purchased two vessels of slabs from Brazil. You also need to add the slabs coming out of USS Hamilton Works (Canada) all of which are being sent to other U.S. Steel facilities in the United States for further processing due to the lockout at the USS Lake Erie plant in Canada. The following companies buy internationally sourced hot band - normally from their parent company but not always – UPI (a joint venture mill between U.S. Steel & Posco out of Korea) and Steelscape (owned by Bluescope in Australia). Add to this mix mills which will from time to time bring in full hard cold rolled such as CSN (from their parent in Brazil).

 

Arcelor Mittal to Build Bar and Beam Mill in Ontario, Canada; posted March 22

ArcelorMittal, Luxembourg, has signed an agreement with the Tver region of Russia to construct a greenfield long-carbon-steel production unit. The agreement makes available land to build a steel complex consisting of an electric arc furnace, with an annual capacity of one million tons, and two bar mills. The steel complex will be built in two phases, beginning with a bar mill with the capacity to produce 600,000 tons of rebar and merchant bar. Work on the site will start during the second quarter, and commissioning of the mill is scheduled for early 2010.

ArcelorMittal also has announced plans to build a $380 million beam mill in Contrecoeur and the restructuring of its steel production activities in Canada. Flat carbon production will be consolidated in Hamilton and long carbon production in Contrecoeur. With this restructuring, the Contrecoeur site will close down its hot-mill operations on Jan. 31 and its cold-mill operations on Feb. 29.

“ArcelorMittal wants to develop a sustainable Canadian steel business. With the former Dofasco facility now part of ArcelorMittal in Hamilton, it does not make business sense to have Contrecoeur compete with a sister company in the flat carbon segment while Dofasco has unused capacity,” says Jos Jacqué, CEO, Long Carbon, North America. 

 

 

Q&A with Manufacturing Business Expert Richard McCormack

Politicians need to be hit over their heads with a baseball bat as forcefully as is possible, with Americans insisting that they at least acknowledge that a country that doesn't make what is consumes is going to fail. It is a simple concept. There are many historical precedents of countries and empires failing after having lost their productive capacity. It is an ancient concept: a country that does not have industry cannot support an army," Richard McCormack

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Feds defend case against U.S. Steel

Government lawyers shot down U.S. Steel's argument that the Investment Canada Act is essentially flawed in Federal Court yesterday. Industry Canada was in the hot seat defending its stance against U.S. Steel, which it says failed to adequately explain why it hasn't met employment and production promises it made when it bought former Hamilton-based Stelco in 2007. U.S. Steel has argued the case should be thrown out because the act doesn't explain what constitutes an adequate justification.

The company's case rests on the premise that the act is quasi- criminal in nature because of steep penalties it imposes on foreign investors who fail to meet promises without affording investors all the rights allowed in a criminal case. Penalties under the act can amount to fines of $10,000 per day or divestiture of Canadian assets. Government lawyer Jeffrey Johnston fired back saying the case has none of the signposts of a criminal proceeding since no one has been arrested. Justice Dolores Hansen will decide whether the case against U.S. Steel should be thrown out once the government wraps up its arguments. U.S. Steel's constitutional challenge to the Investment Canada Act is the first since it was adopted 24 years ago. A federal review is required any time a Canadian company with assets of more than $312 million is purchased by a foreign entity. About 800 workers at the U.S. Steel plant in Nanticoke have been laid off while another 250 workers have been locked out by the company.

U.S. Steel Tells Court Canada's Foreign Investment Law Is 'Essentially Flawed' An American steel company says legislation governing foreign investment in Canada contains one "essential flaw": it punishes a company that doesn't comply with its rules as if it has committed a criminal offence, but doesn't give it the rights guaranteed under criminal proceedings. U.S. Steel Corp. (NYSE:X) was in Federal Court on Tuesday, arguing that a case against it should be thrown out due to the legal flaws in the Investment Canada Act. The steelmaker is being sued by Ottawa for breaking job and production promises it made Click for continuation

United Steelworkers and U.S. Steel Win Trade Dispute With China. Wall St. Journal Posted Jan. 1

Long-Term Impact on U.S.S. Lone Star, Fairfield and Granite City Works Could Be Significant

U.S. steelmakers won a case over Chinese steel imports, as the U.S. International Trade Commission voted that the domestic industry has been damaged by subsidized steel from China.

The ruling Wednesday will result in dutes of between 10% and 16% on future imports of Chinese steel pipes used to extract natural gas and oil.

The steel-pipe case is the ITC's biggest ever by dollar amount, and comes as the world's recession and overall drop in demand for steel products has left steelmakers competing for a smaller pool of customers.

All six commissioners ruled that imports of so-called oil country tubular goods from China, totalling $2.8 billion in 2008, injured U.S. manufacturers.  The commission is made up of three Democrats and three Republicans, five of whom were appointed by the Bush administration and one by the Clinton administration.

The Chinese government can appeal the decision to the World Trade Organization, and Chinese steelmakers can appeal to a federal district court in New York that handles trade cases.  Daniel Porter, a Washington attorney representing the chinese exporters, said a decision on whether to appeal could be made in several weeks, once a detailed ruling by the ITC explaining the rationale for its decision is made public.

U.S. steelmakers, along with the United Steelworkers, said China tripled its imports into the U.S. -- a big consumer of tubular steel -- causing a 50% drop in prices, swelling inventories, and causing the layoffs of 3,000 workers.

U.S. Steel Corp. said it was pleased with the ITC's ruling Wednesday.  "This enormous surge of unfairly traded goods resulted in an overhang of inventory that crippled the domestic industry," the company said.

Pittsburgh-based U.S. Steel and seven other domestric producers, along with the United Steelworkers, filed a trade compalint in April against Chinese producers and exporters, climaing China's government was subsidizing pipe-production costs.  Last month, the U.S. Commerce Department imposed countervailing duties on the steel pipes ranging from 10.4% to 15.8%.  The ITC's decision Wednesday allows the government to finalize those duties. 

The energy market -- the key end market for steel pipe -- is critical to steelmakers because it tends to be more resilient in downturns compared to auto and appliance markets, which are hurt when labor and job markets are weak and consumers cut back spending.  Drillers use so-called tubular goods to line wells and carry oil and natural gas from wells to consumers.

The dicision has far-reaching implications, giving domestric producers better pricing power and more incentive to invest in production.  They aren't expected to resume production or hire laid-off stellworkes until inventory levels fall. Chinese steelmakers are in a bind because they have excess capacity and can't automatically funnel it to Europe because the European union and steel producers there have beefed up trade actions against China as well.

New duties on imported pipe 'could tighten up a highly over-supplied makret," said Joe Hill, a vice president of Houston energy bank Tudor Pickering Holt.  While he expects that it will become more expensive to drill wells, tubular goods are a small percentage of well-drilling costs.

House Representatives urged to strengthen US steel law; posted Dec. 21

It is reported that Mr Pete Visclosky US Representative is co sponsoring legislation which would strengthen the Buy America law to ensure that only American made steel is used in construction projects undertaken by the departments of Defense, Homeland Security and Transportation.

Mr Visclosky said that "As we work to revitalize our economy by modernizing and expanding our infrastructure, we can take the effort a step further by using only American construction materials, especially steel. My American Steel First Act will help ensure that American steelmakers are an important part of our economic stimulus so that Northwest Indiana’s mills stay running."

Mr Jim Robinson director of the United Steelworkers District 7 said that "If the government wants to stimulate the economy by building infrastructure, then we need to make sure American steel goes into those projects and steelworkers are a part of the recovery. Mr Pete’s bill is a commonsense way to get America working again and will benefit steelworkers in Northwest Indiana and across the country."

Mr Visclosky further added that "Now more than ever, the US government should lead by example, reject unfair imports from countries like China, and uphold American manufacturing. The American Steel First Act will make the government start buying American as it ought to be, and help Northwest Indiana and the nation pull through these terribly trying times."

Steel Backs Energy Tax Credit Extension

The Obama administration's support of $5 billion of additional tax credits for building and equipping domestic manufacturing facilities that make renewable energy products provides a huge shot in the arm to spark economic growth and expand America's ability to create clean and green jobs for the future. It is just what the doctor ordered," USW president Leo W. Gerard said. "Expanding alternative and renewable power generation must be coupled with the expansion of the capacity to produce the power generation equipment itself. President Obama's commitment to this $5 billion will do exactly that." The additional $5 billion "is good news for workers in communities all across America who are already well aware of the deterioration of our industrial base," Scott Paul, executive director of the Alliance for American Manufacturing, whose members include U.S. Steel Corp. and Allegheny Technologies Inc., among other metals companies. "Our manufacturers and workers face a flood of subsidized competition from Asia and Europe seeking to capitalize on new demand for clean energy products in the United States, such as wind turbines and solar panels. With a manufacturing strategy, aggressive enforcement of trade laws, and investments like the $5 billion announced today, we can successfully compete."

December 17, 2009 AMERICAN IRON AND STEEL INSTITUTE WELCOMES ADMINISTRATION'S FOCUS ON REVITALIZING AMERICAN MANUFACTURING

December 17, 2009 AMERICAN IRON AND STEEL INSTITUTE WELCOMES ADMINISTRATION'S FOCUS ON REVITALIZING AMERICAN MANUFACTURING WASHINGTON, D.C. – The American Iron and Steel Institute (AISI) today praised President Obama and the Administration for their focus on revitalizing American manufacturing as outlined in a new report issued yesterday, "A Framework for Revitalizing American Manufacturing." "The Administration's focus on revitalizing America's manufacturing sector in order to create much needed jobs here in the U.S. is welcomed by the steel industry," said Thomas J. Gibson, president and CEO of AISI. "As the report states, the domestic steel industry contributes $350 billion annually to the economy and directly employs over 165,000 people, supporting 1.2 million jobs. The steel industry, with its technology advancements and productivity improvements, is already a part of this revitalization of American manufacturing." click link for continuation

Reports are China now sitting on capacity of 610 million tons will be commissioning another 50 million tonnes next year. Posted Dec. 7

Rising Chinese steel capacity a worry for other nations

The Wall Street Journal says in a report that the quiet shrinking of steel capacity in the US is led by the world’s biggest steel group ArcelorMittal, which thinks “it can do more with less by running fewer plants at higher capacity.” ArcelorMittal closing down mills at Lackawana, N.Y. and Hennepin no doubt will help in stepping up capacity use at its other facilities leading to cost control.  

But will not ArcelorMittal’s ambitious growth plans further add to world steel overcapacity? Reports are China now sitting on capacity of 610 million tonnes will be commissioning another 50 million tonnes next year. A spokesperson for China Iron & Steel Association said at a recent conference in Beijing that the country would end the year with production of 565 million tonnes of crude steel. That will be a lot more than China’s domestic requirements, making the world, including India vulnerable to dumping. CISA is no doubt estimating domestic demand by several million tonnes extra at 549 million tonnes.

 

 

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Slabs from Germany to supply Alabama with slab into 2011

ThyssenKrupp’s Duisburg steelworks in Germany will supply slab to the hot rolling mill the company is building in Mobile, Alabama, in the USA, until the second quarter of 2011, ThyssenKrupp says in its latest financial report. Construction of the Mobile mill is “largely on schedule” and production should begin in the second quarter of 2010. Slab will ultimately be supplied by the new steelworks the company is building at Sepetiba in Brazil. However, the ramp-up of the Brazilian plant has been adapted in line with lower steel demand expectations

Chinese Pipe Duties Revised Down to 13.2% by U.S; posted Nov. 26

Chinese Pipe Duties Revised Down to 13.2% by U.S. The U.S. Commerce Department cut the average duties on $2.7 billion of Chinese pipe imports to 13.2 percent from the 21.3 percent set in September, a measure taken after both countries last week agreed to ease trade tensions. The decision, on imports of steel pipe used in oil wells, is the final ruling by the Commerce Department and sends the case to the U.S. International Trade Commission. China will probably seek mediation through the World Trade Organization. 

The U.S. International Trade Commission will decide in January if tariffs will take effect. Importers must deposit the tariffs set yesterday until the ITC decision.  The pipe case is the largest so-called countervailing duty complaint filed against Chinese products and was brought by the United Steelworkers union; U.S. Steel Corp., the largest U.S.- based steelmaker; U.S. operations of Evraz Group SA, Russia’s second-largest mill; and Pennsylvania-based Wheatland Tube Co. 

U.S. Steel and its rivals have said they have been hurt by a 358 percent surge in imports of the pipe from 2006 to 2008. Lawyers for the Chinese companies said record oil prices drove demand for the product, leading to the rise in imports.

FUTURE US AUTO SALES COULD BE 'NIGHTMARE' FOR STEELMAKERS-posted Nov. 16

When it comes to the North American auto industry's annual production, the "new normal" might prove to be a "nightmare scenario" for steelmakers, according to a leading auto industry analyst heard by Steel Business Briefing. Speaking during the Metals Service Center Institute's Canadian Fall Outlook conference in Toronto, DesRosiers Automotive Consultants president Dennis DesRosiers said despite current high auto ownership levels among US residents, that dynamic could be changing - depressing the automotive market for much of the next decade in the process. Among US residents of driving age, the rate of ownership was around 101% in 2008, versus 74.1% in Canada, DesRosiers said. However, as sales dip and consumer behaviors change, those percentages are likely to change, he said. From 2000-2008, US sales averaged 16.8m units a year. Under a best case scenario, DesRosiers projects annual sales will be in the range of 14-15m/y by 2020. At worst, they could be close to 9-10m by then. Regardless, "you're probably looking at 3m to 4m less vehicle sales" per year, he said, and if a company has even $1 of material in each vehicle - and many steelmakers have much more in each vehicle - the loss of annual business will be substantial. "We think a more realistic number would be 12-13m (units/y)," DesRosiers said. "Canada can offset some of that (loss) because there's room for growth there. But if you take 3-4m units out of the equation, you're going to take steel production out of the equation."

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OBSERVERS SEE HOPE FOR NA PIPE MARKET IN 2010-posted Nov. 12

Large oil plays along the Gulf of Mexico are driving a surprise recovery for North American OCTG and line pipe much sooner than expected, according to some market observers.  More than a hundred oil wells are expected to be drilled in an east Texas oil play over the next month, with similar growth expected in northeastern US natural gas plays as temperatures drop, said one pipe market observer.

“The mills are hungry,” he said. “We’re starting to see holes developing in certain sizes of OCTG. What we’re seeing under the surface is this thing is going to get significantly better earlier than we thought.”  First quarter inquiries are steadily increasing, and shipments should pick up by Q3 2010 at the latest, he added.

“You just drive down the highway in south or west Texas, and you’ll see truckload after truckload of pipe going down there,” he said. “Someone’s doing something. The (pricing) bottom has come up at least $100–150 per ton. The deals you used to get for the price of hotrolled are no longer there.”  A second observer in the Gulf region reported similar anecdotal reports of an unexpected petroleum industry revival, Steel Business Briefing reports.

Alloy pipe in particular is stabilizing after a price dip, and shortages are occurring in regions with heavy natural gas drilling, he said.

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The US Commerce Department found preliminary dumping margins up to 99% in the trade case against imports of Chinese oil country tubular goods - and those with the highest margins will see duties applied retroactively to material brought in as early as August. Nearly 40 Chinese companies were assigned preliminary margins of 36.53%, but one company, Jiangsu Changbao Steel Tube, received a 0% margin. All other Chinese producers and exporters got a 99.14% rate. Critical circumstances were found with regard to the "all other" category. Thus the duties for these companies will be retroactive 90 days prior to the publication of the preliminary determination, Steel Business Briefing understands. The United Steelworkers union (USW), one of the petitioners in the case, is questioning why Jiangsu Changbao received the 0% rate and plans to challenge this decision. This preliminary decision had been postponed in August, as SBB reported. The final determination for the AD case has been extended at the request of exporters and is now scheduled for March 19, 2010. SBB notes that Commerce found preliminary subsidy rates of 10.9% to 30.69%, depending on the company, in the countervailing duty (CVD) case against Chinese OCTG imports. A final hearing with the International Trade Commission (ITC) is scheduled for December 1. The final Commerce decision in the CVD case will be made later this month and the ITC’s final injury determination will be made in early January.

The United States has set preliminary anti-dumping duties ranging from 36.53 percent to 99.14 percent on Chinese-made steel pipe used in oil wells, a source familiar with the decision said on Thursday. U.S. companies imported $2.63 billion of "certain oil country tubular goods" from China in 2008, or more than three times the $750 million they imported in 2007.

That makes it the largest U.S. trade action ever against China by volume of imports. It tops President Barack Obama's decision in September to slap a 35-percent tariff on about $1.85 billion of Chinese-made tires.

They reflect the department's determination of how far below "fair market value" Chinese companies are selling steel pipe and tubing product in the United States.  At issue are imports of steel pipes used to extract oil or gas from a drill well. Imports of Chinese pipe totaled $2.6 billion last year, more than four times the amount in 2006, the Commerce Department said.

The United Steelworkers union and seven U.S. companies, including U.S. Steel Corp., petitioned for the duties.  

Steelworkers President Leo Gerard hailed the preliminary decision.  "China's government and exporters are being told we are fed up with their cheating on our fair-trade laws, and penalties for these transgressions are long overdue," Mr. Gerard said in a statement.

Mr. Obama travels to China later this month, and trade tensions with Beijing are likely to be high on the agenda in his talks with Chinese President Hu Jintao.

U.S. Steelmaking=Lower Cost Than China

 

 

In reference to an article printed in the Wall St. Journal and abbreviated further down on this web page, China Takes A Hard Look at Its Steel Industry, Michelle Applebaum wrote; “Your terrific article misses what I think is the key point in the “math” of why China needs to cut back. You say that the beneficiaries of Chinese cutbacks would be in “high cost areas like Europe and North America.” Actually, both regions are lower cost steelmaking regions, largely because of more efficient scales of operation as well as lower-cost raw materials. In today’s steelmaking universe, raw-material and access is far more important that low-wage rates, so the comparative advantage rests with much of the West. This is the key reason why the Chinese need to cut back their least efficient mills. China has been using a carrot-and-stick process, encourage closures while providing subsidies for exporting excess steel to bail out these high cost players. The problem is that the Chinese are suing a far too sweet carrot-subsidies-and a fairly limp stick. Michelle Applebaum has over twenty years of experience as an equity research analyst on Wall Street covering the steel industry. Institutional Investor Magazine has acknowledged her as its top-ranked steel analyst since 1988. She has served as an advisor to the country’s largest money managers and steel companies

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USS LONE STAR USS Fairfield Still Impacted by High Inventories of Illegally Dumped, Subsidized Imported CHINA STEEL Oct. 28

US Steel Tubular improves, but still reports $21m loss Wednesday, October 28 2009 US Steel’s tubular segment had an operating loss of $21m in the third quarter, an improvement over the division's second quarter loss of $88m. However, OCTG and line pipe prices have not yet hit bottom. USS Tubular had operating profit of $420m in last year's third quarter, but high inventories, due in large part to a flood of Chinese imports, saturated the market this year, Steel Business Briefing notes. Inventories in carbon OCTG have been worked down to about a 1-year level, or approximately 3m short tons, according to USS. A healthy level of OCTG inventories is about six months. Alloy OCTG remains relatively strong due to its use in the large natural gas deposits in the Marcellus Shale, though prices have been trending downward due to an oversupply of natural gas and weak gas prices, USS said. Line pipe also remains weak, as gas prices are not motivating rig owners to bring their gas to market. “We may be seeing an overall bottoming of prices now,” said one USS executive in a conference call to discuss Q3 earnings. “Line pipe inventories are still on the high side, but they’re moving in the right direction.”

RUSSIAN PIPEMAKER CAN'T SAY WHEN Large Diameter US Pipe MILL WILL REOPEN Nov. 1

RUSSIAN PIPEMAKER CAN'T SAY WHEN US MILL WILL REOPEN Evraz Inc NA says it has no firm restart date for its Portland, Oregon tube mill. Following reports that Evraz’s Portland works may be restarted to handle increasing orders in 2010, a company spokeswoman said capacity at the company’s Canadian mills is sufficient to handle the orders. She also said company executives are encouraged by an increasing number of orders, but demand remains too weak to set a timeline for the mill’s restart. Russia-based Evraz idled the mill in July due to a North American inventory glut of large-diameter pipe, Steel Business Briefing notes.

Several Nucor projects moving forward Thursday, October 22 2009

Nucor executives gave an update of some upcoming and ongoing projects during the company’s third quarter conference call yesterday, which was monitored by Steel Business Briefing. Among the highlights: The company’s new galvanizing line in Decatur, Alabama, which started running in July, is “off to an excellent start,” said COO John Ferriola. The line has a capacity of 500,000 short tons/year. Additionally, the second Castrip unit at the Nucor-Yamato steelworks in Blytheville, Arkansas had a great start up, and the company expects to have product available for customers by year-end, Ferriola said. The company also plans to make sure the 500,000 short tons/year idled longs mill in Kingman, Arizona will be ready to come back on line when business picks up. It purchased the mill some six years ago from the former North Star Steel at a cost of $65m. “When there is sufficient recovery in market demand, our Kingman team will be ready to roll” said Ferriola. In discussing the potential Louisiana pig iron facility, CEO Dan DiMicco said the company is curious about what Congress will do concerning carbon emissions legislation. They also spoke of the company’s plans to expand its export business with overseas office ___________________________________________________________________

Tribes Stall Steel Projects in India Wall St. Journal October 26

Steel companies have pledged billions of dollars to expand in India but they are struggling to secure the land they need in two mineral-rich states because of fierce opposition from local tribes and slow moving governments.

The standoffs have hit tow of the world's top five steel producers, ArcelorMittal and Posco and are threatening to stall a key driver of India's industrial activity in years ahead.  According to the steel ministry, projects worth $82 Billion are being held up because of delays related to land acquisition and environmental clearances.

South Korea's POSCO signed a deal in 2005 to build a 12 million ton a year steel plant but has yet to begin construction.

South Carolina Mittal Steel Plant May Not ReStart Until 2011

Longer Wait for Steel Mill Reopening in Georgetown – District 9

Longer Wait for Steel Mill Reopening in Georgetown – District 9 The watching and waiting for the buzz of activity to resume at the ArcelorMittal's Georgetown steel mill will likely have to wait until 2011, according to one official. United Steelworkers Union Local President 7898 James Sanderson said he got a call Friday from a corporate official to tell him, "Because of deteriorating market conditions our plant will not open up this year, and it probably won't open up until 2011." ArcelorMittal spokesman Adam Warrington did not confirm the dates, but did release the following statement on … more

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U.S. Steel is taking aim at the Investment Canada Act as a "vague, ambiguous" and unconstitutional law that violates its right to a fair hearing. The Pittsburgh steelmaker wants the government's lawsuit against it thrown out, arguing the act provides no explanation of what constitutes a breach or when one is justified. "The legislation is vague, ambiguous, allows for the imposition of penal sanctions and superimposes an ill-suited civil process on a criminal, or quasi-criminal, proceeding," U.S. Steel says in court documents. The federal government is suing U.S. Steel over the shutdown of the former Stelco, a move Industry Minister Tony Clement says breached two of 31 undertakings the firm made under the act. The case marks the first time the government has sued a foreign investor under the act since it became law in 1984. Clement has asked the court to order U.S. Steel to meet the commitments -- related to employment and production levels -- or face penalties of $10,000 a day. U.S. Steel idled its Hamilton blast furnace in November 2008, and mothballed the rest of its Canadian operations in March -- bringing production to a halt and putting 2,190 employees out of work.

In May, Clement sent a "demand letter" to U.S. Steel after determining the firm had violated its commitments. U.S. Steel says it asked to meet with Clement. When its request was denied, it sent an 88-page response to the letter that included "a detailed description of the sudden international economic crisis and the severe impact that crisis had, and has continued to have, on the steel industry, in general, and specifically on (U.S. Steel) as it pertained to the two undertakings in issue." In a cover letter to the response, the steel firm reaffirmed its desire to meet with the industry minister, but never received a response, the documents state. Though U.S. Steel provided further information at the request of the government, it heard nothing back until July, when Clement launched his lawsuit. Though the act contemplates significant penalties, including the forced sale of an asset and the daily fines, it gives no indication of when breaking a commitment is justified and offers no guarantee of a fair hearing, the firm says. "Despite a detailed 88-page response which outlined the compliance with the 31 undertakings and impact of the most severe economic downturn since the Great Depression, the meaning of the term 'justify' remains a mystery," U.S. Steel says in its motion.

Mergers and acquisitions (M&As) in China's huge but fragmented steel sector are increasing this year, with big producers taking over the smaller ones. The latest to hop on to the consolidation bandwagon is Hunan Valin Iron & Steel Group, the country's tenth-biggest steel mill by 2006 production, which last week decided to buy a 55 percent stake in Jiangsu Xigang Group, the No 69, for 400 million yuan. Before that, Wuhan Iron & Steel Corp, the country's fifth-biggest steel mill by 2006 production, this month decided to take over Kunming Iron & Steel Co Ltd, ranked 23. Zhang Xiaogang, president of the No 3 steelmaker Anshan Iron & Steel Corp, said recently it will ink an asset deal with the No 12, Benxi Iron & Steel Corp, later this year to form China's new steel champion, beating Baoshan Iron & Steel Corp (Baosteel). Consolidation of the CHinese steel industry could leave China in a better position to negotiate iron ore prices. Cheng predicted China's top 10 steel mills will control 36 percent of total crude steel production in the country this year, up from 33 percent in 2006. However, Zheng Dong, from Guosen Securities Co in Beijing, said the current pace of M&As or consolidations, mainly pushed by the government, is not fast enough for China's steel sector, where there are around 800-odd steel mills with the majority being too small to contest globally. "Massive market-driven M&As are expected two to three years later as steelmakers will have to consolidate to survive mounting competition and gain more power in talks with raw material providers," Zheng said. "Many small steelmakers are unwilling to be bought out by big ones as they enjoy bumper profits thanks to strong market demand and prices." Xu Zhongbo, CEO of Beijing Metal Consulting Co, agrees: "Who wants to be at the mercy of others if it's doing fine by itself? This is the biggest obstacle to M&As in this sector."

China is under pressure from Europe and the U.S. to keep excess Chinese steel from flooding their markets.

Russian steelmakers’ plans for world domination are in tatters. A spending spree on U.S. mills meant to lift their billionaire owners into the industry’s top rank is instead forcing them to renegotiate debt and write down assets. OAO Severstal, the biggest producer, may sell some of the U.S. plants it bought for almost $4 billion at fire-sale prices or seek bankruptcy.

The cost of funding debt in Russia has risen by about 50 percent, according to data Bloomberg compiled. “Russian steelmakers’ acquisitions in the U.S. were all unsuccessful,” said Dan Yakub, a Citigroup Inc. analyst in Moscow who recommends investors sell Evraz and who has a “hold” rating on Severstal. “The management wanted a global business, to get more flags on the map. They overestimated the potential of the U.S. market and underestimated the depth of the price collapse.”

While the Russians began buying U.S. mills in 2004, with Severstal’s purchase of Rouge Steel Co., it was rising steel prices two years later that fueled an acquisition binge, totaling $18 billion according to Moody’s Investors Service. Even as economies and prices retreated from May 2008, Evraz, Severstal and OAO Novolipetsk Steel kept buying to try to pick up bargains. Instead the prices fell further, wiping as much as 70 percent off asset values, according to VTB Group.

The billionaire steel magnates, while driven by personal ambition, also bought operations in North America and Europe as a way to avoid anti-dumping duties and import quotas on the steel they were shipping from their plants in Russia. In addition, access to Russian electricity a third the cost of power in western Europe along with cheaper raw materials and labor meant the steelmakers had double the profit margins of foreign rivals, and an impetus to invest spare cash that was out of step with the global economic cycle. “It was natural for Russian steel companies to look for targets abroad,” said Aivaras Abromavicius, who helps run $2.5 billion in Russian equities at East Capital in Moscow. “Looking back, of course, it seems it would have been wiser either to return more cash to the shareholders in the form of dividends or to use it to pay back some of the loans.” Severstal remains “committed” to operating in North America, “one of the world’s most important long-term markets for steel,” the company said in an e-mailed response to questions on Sept. 29. It declined to comment on any sales of assets, write-offs or the viability of its U.S. operations. North American domestic hot-rolled coil has rebounded 57 percent from the more than five-year low of $370 a short ton on June 9, 2009. The benchmark for regional steel prices lost two- thirds of its value in the previous year from a record $1,125. As the worst of the economic slump passes, prices rebound and demand returns, pressure on producers to write down assets may ease. UBS AG on Sept. 23 raised its fourth-quarter forecast for North American hot-rolled coil 20 percent to $570 a ton.

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Canada Pipemaker Claims U.S. Steel Sacrificed Jobs and Poses threat to the Canadian Public Interest Sept. 30

U.S. Steel sacrificed production and jobs at the former Stelco to protect its American plants, Lakeside Steel says in new documents filed with the Federal Court of Canada. While the foreign owners of ArcelorMittal Dofasco and Essar Steel Algoma Inc. adopted strategies to preserve jobs through the economic meltdown, U.S. Steel showed a "callous disregard" for workers by mothballing its Canadian plants, Lakeside alleges. "Only U.S. Steel Canada has seen extensive layoffs or lengthy shutdowns," Lakeside sales director Randy Sockovie said in an affidavit. "Essar Group and ArcelorMittal have demonstrated that it was not impossible to act responsibly in the face of the current economic downturn." In the documents, Lakeside also takes aim at the Pittsburgh steelmaker's support for certain "protectionist" trade policies, including the controversial Buy American provision attached to the U.S. Stimulus Act. U.S. Steel is now lobbying for further legislation that would block the use of Canadian steel in U.S. stimulus projects, Sockovie says, even though those measures are adverse to the interests of U.S. Steel Canada and the Canadian steel industry. Sockovie concludes that U.S. Steel has no incentive to run its operations in Hamilton and Nanticoke except when its U.S. plants are at capacity. "In other words, U.S. Steel treats the Canadian facilities as overflow facilities," he says in his affidavit. The filings from the Welland pipemaker are the latest volley in the Federal Court battle over the shutdown of the former Stelco. Lakeside holds intervener status in the proceedings, which will decide whether the shutdown violated production and employment commitments made by U.S. Steel under the Investment Canada Act. Lakeside chairman and co-CEO Vic Alboini wants to buy Stelco and has asked the court to order a sale. That remedy would go well beyond Industry Minister Tony Clement's request that the court order U.S. Steel to meet its production and employment commitments or face penalties of $10,000 a day. In a separate affidavit, Alboini says the fines will mean little to an industrial giant such as U.S. Steel, which churned out $4.9 billion in revenue in the first half of 2009. And an order to comply with the jobs and production commitments "will not resolve the long-term threat to the Canadian public interest that is posed by U.S. Steel's self-interested management of U.S. Steel Canada," he adds. "U.S. Steel has shown that its primary corporate interests lie in its U.S. operations, for the sake of which it is prepared to sacrifice production and employment at U.S. Steel Canada," he says in the documents. "U.S. Steel has shown beyond any doubt that that it cannot be entrusted with the future stewardship of U.S. Steel Canada." Lakeside has also said it is interested in buying some or all of the assets of Barzel Industries Inc., an insolvent U.S.-based pipe manufacturer that has operations in Canada.

Mittal May Halt $20 Billion, 24 Million Ton Annual Producing Steel Plant Investment

October 5: The world's largest steel maker ArcelorMittal is threatening to scrap a US$20 billion project to build two major steel plants in eastern India because of problems with land acquisition. Chairman Lakshmi Mittal was quoted in Monday's Financial Times as saying that delays in purchasing the land from farmers and others in the states of Orissa and Jharkand were "unacceptable". "If we cannot make progress in these two sites, we will have to abandon the idea of starting the projects there and look for other places in India for our expansion," Mittal told the newspaper. The saga has echoes of the problems encountered last year by India's largest vehicle maker Tata Motors which was forced to shift the plant for its new, cheap Nano car from West Bengal to Gujarat amid farmers' protests over land acquisitions. India's industrial expansion faces a problem in purchasing agricultural land for development, with farmers often unwilling to sell and regional politics fuelling local anger at perceived commercial exploitation. Mittal told the Financial Times that people in India needed to be "educated" to understand the collective benefits of industrial development. The two plants envisaged by ArcelorMittal would jointly produce around 24 million tonnes of steel by 2015.

By Peter Whoriskey Washington Post Staff  September 10, 2009

In one of the largest U.S.-China trade cases ever, the U.S. Commerce Department has issued a preliminary finding that Chinese steel pipe producers have received government subsidies in violation of trade law, helping them overrun the competition. The volume of steel pipes imported from China more than tripled between 2006 and 2008, rising from $632 million to $2.6 billion, according to the Commerce Department. The subsidies from the Chinese government allowed the firms to overwhelm their U.S. rivals, according to six U.S. companies that filed the complaint along with the United Steelworkers union. The companies alleged that their Chinese rivals received discounts on raw materials and loans from government-owned firms. To even the playing field, the Commerce Department has ordered that tariffs ranging from an estimated 11 percent to 31 percent be imposed on the steel pipes from China. The steel pipes at issue in the case are those used primarily by the oil and gas industry. They are known as "oil country tubular goods." By dollar volume of imports in the industry, the case represents the largest U.S.-China trade case ever, attorneys said. The ruling "means that from this day on that U.S. producers won't have to compete against the government of China," said Roger Schagrin, an attorney who represented the United Steelworkers and four U.S. makers of steel pipe in the case. "They can have a chance to recover."

U.S. Penalizes Chinese Tires, Infuriating Beijing September 12, 2009

The Associated Press:

China condemned the White House's announcement late Friday to impose tariffs on auto tires as protectionist and said it violated global trade rules. At home, the punitive tariffs on all car and light truck tires coming into the U.S. from China may placate union supporters who are important to the president's health care push. Chen Deming, China's minister of commerce, said the penalties would hurt relations with the U.S. A ministry statement said Obama had "compromised to the political pressure of the U.S. domestic trade protectionism." "The Chinese government will continue to uphold the legitimate interests of China's domestic industry and has the right to take corresponding measures," Deming said. Obama had until this coming Thursday to accept, reject or modify a U.S. International Trade Commission ruling that a rising tide of Chinese tires into the U.S. hurts American producers. The United Steelworkers blames the increase for the loss of thousands of American jobs. The federal trade panel recommended a 55 percent tariff in the first year, 45 percent in the second year and 35 percent in the third year. Obama settled on 35 percent the first year, 30 percent in the second and 25 percent in the third, White House press secretary Robert Gibbs said "The president decided to remedy the clear disruption to the U.S. tire industry based on the facts and the law in this case," Gibbs said. The decision comes as U.S. officials are working with the Chinese and other nations to plan an economic summit in Pittsburgh on Sept. 24-25 of the 20 leading rich and developing nations. China will be a major presence at the meeting, and the United States will be eager to show it supports free trade.

USW seeks USD 44 million for Stelco shutdown from US Steel Sunday, 13 Sep 2009

It is reported that United Steelworkers union is seeking nearly USD 44 million in damages for lost wages and dues following the shutdown of the former Stelco by US Steel. The union, in documents filed with Federal Court of Canada, said that workers suffered financial loss as well as emotional harm as a result of layoffs and uncertainty at the Nanticoke and Hamilton plants. Mr Rolf Gerstenberger president of Local 1005 said in an affidavit that "I believe that US Steel has no intention of dealing with its employees, their bargaining agents, their local communities and the Canadian steel industry in good faith. I believe that the majority of persons directly and indirectly affected by US Steel's layoff and lockout of employees want US Steel to get out of the Canadian steel business." Despite opposition from US Steel, the union recently won intervener status in Ottawa's lawsuit against the steelmaker. The union wants the court to force US Steel to sell its Canadian operations, claiming neither the workforce nor the public believes the firm will ever deliver on its production and employment commitments. In a separate affidavit, Mr Bill Ferguson president of the union local at Lake Erie Works said that US Steel demonstrated a disregard for its employment commitments by locking workers out after Clement sent a demand letter ordering the firm to meet its commitments. He added that "US Steel has behaved in a manner that demonstrates that it does not have a long term commitment to operating in Canada." (Sourced from www.thespec.com)

A Canadian Company has Expressed Interest in Acquiring the Ontario Assets of U.S. Steel. August 6, 2009

A Welland company has expressed interest in acquiring the Ontario assets of U.S. Steel. Lakeside Steel Inc. wants to buy U.S. Steel's idled factories in Nanticoke and Hamilton. Documents filed with the Federal Court of Canada yesterday indicate the company is prepared to use legal pressure to do so. Lakeside Steel has filed a motion for intervenor status in the lawsuit that Industry Minister Tony Clement recently brought against U.S. Steel Canada and its parent company U.S. Steel Corporation. Lakeside Steel chairman and CEO Vic Alboini supports Ottawa's pursuit of damages against U.S. Steel for failing to honour covenants it made when it purchased the former assets of Stelco Canada in 2007. These commitments include promises of steady employment and increased production. Since then, a deep recession has depressed demand for steel worldwide. As well, Washington, D.C., has greatly altered the American steel industry's priorities with a $787 billion stimulus program that requires participants to "Buy American." Now that U.S. Steel has idled plants in Hamilton and Nanticoke, Alboini says Ottawa is correct to challenge the status of U.S. Steel's holdings in Ontario. "You haven't really bought Stelco," he said. "You haven't lived up to your commitments. We don't see U.S. Steel complying with these commitments under current conditions. We have to decide, as Canadians, whether we let them off the hook or whether we hold them to the commitments they have made. We think the appropriate remedy is, sorry, you have to sell it." Lakeside Steel is a publicly-traded company with a workforce of 390. Prior to the onset of the recession, the firm employed 504. Lakeside Steel acquired Stelco's Stelpipe division in 2005 after Stelco entered bankruptcy protection. Lakeside Steel specializes in pipe and tubing for the oil and gas industry, mining, the automotive industry and commercial manufacturing.

Government Sues U.S. Steel – District 6  July 21, 2009
The federal government is taking the unprecedented step of suing U.S. Steel over the shutdown of the former Stelco. Industry Minister Tony Clement said he is "not satisfied" with U.S. Steel's response to a demand letter he sent in May, asking the firm to comply with the production and employment commitments it made when it bought Stelco in 2007. Clement believes those commitments were violated when U.S. Steel temporarily idled its Canadian operations in March. "There's no free ride, there's no get out of jail free card," Clement said in … more

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Obama ‘Going to Bat’ for Unions on Labor Rights, Kirk Says July 16, 2009
U.S. Trade Representative Ron Kirk says the Obama administration is “going to bat for American industrial workers” through greater protection of labor rights and more aggressive monitoring of overseas trade practices. Kirk, in a speech today at a U.S. Steel Corp. plant near Pittsburgh, will pledge to force countries including Peru and Guatemala to live up to labor commitments they made in trade agreements, according to a copy his prepared remarks. “We will immediately identify and investigate labor violations, before they can … more

 

Letter From Leo Gerard Sent to the House of Representatives in Support of the Clean Energy Bill

Dear Representative:  

By ensuring that nations that do not share our commitment to this cause cannot profit from our attempt to prevent global warming, America can lead the way toward a comprehensive, enforceable global agreement to curb greenhouse gas emissions. Access to our consumer market is our most valuable leverage in these negotiations, and by including strong provisions to prevent leakage, this bill sends a strong message to every nation in the world that they must come to the table and help us find a solution. The privilege of being able to sell to the American consumer brings with it the shared responsibility to improve the global environment for future generations.

Since 1990, the United Steelworkers have been convinced that addressing the potentially catastrophic effects of global climate change is the challenge of our generation. This problem must be solved now and not passed along to our children. To that end, we are pleased to see that the House of Representatives will soon consider H.R. 2454, a strong bill to meet the challenge of global climate change while transforming the American economy into a world leader in clean energy and products. We urge you to continue to improve and pass this crucial legislation.This will allow American manufacturers to navigate the transition to a clean energy economy, and allow time for the development of a long-term solution. This long-term solution must address the international component, either through an enforceable global agreement that ensures that all nations bear the costs of addressing climate change or, if such an agreement cannot be reached, through a strong border adjustment provision. This border adjustment will prevent American workers from being disadvantaged when competing with producers in nations that have not made the same commitment to solving climate change as the United States. We applaud the work that Chairmen Rangel and Levin and the Ways and Means Committee have done to strengthen the border adjustment provisions in this bill, and urge all members, as well as members of the Senate, to continue to strengthen this vital provision and ensure that it be a key part of America’s strategy to find a global solution to a global problem.

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Free Trade Proponents and Finger Wagging Protectionism Alarmist Should Listen to USW VP Tom Conway's Interview Discussing the Vital Importance of America's Manufacturing Click link below

Good Interview With USW VP Tom Conway on the Importance for American Manufacturing

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KEEP IT MADE IN AMERICA

Drive America Forward

Link on to view the Alliance for American Manufacturing's website describing in detail the purpose of the bus tour, the Kiener Plaza Rally and a video of the Washington D.C. teach-in.

The Five Point Plan to Drive America forward is integral to getting us back to work, so please read the information, sign the petition and take a look at the rountable discussion video as Leo Gerard, Lansing Mayor Virg Bernero, Ed Shultz, a couple economists and Local 1899's Doug May participated in discussions on the need to restore American manufacturing.

http://madeinamericatour.org/

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Click link for the rest of the article

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Rapid Response Teams Work for E.F.C.A.

Rapid Response Teams Build Support for the Employee Free Choice Act
Across the country, Rapid Response Teams have been busy educating USW members on the Employee Free Choice Act, the law that will restore workers’ freedom to form a union. ...more

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May 29, 2009 Video: Trade Reform Strategy Briefing for You Last year, 74 House Members and six Senators cosponsored landmark trade reform legislation setting forth a progressive vision for good trade agreements -- the Trade Reform, Accountability, Development and Employment (TRADE) Act. Very soon, we expect this legislation to be reintroduced in the House of Representatives. Global Trade Watch Director Lori Wallach taped a special video to let you in on our strategy for making sure bad old agreements like NAFTA get renegotiated and future deals benefit us, not just big multinational corporations. Please watch the video below and then write your House member urging him or her to sign on as an original cosponsor of the 2009 TRADE Act.

Global Trade Watch Link _______________________________________________________________________________________________

 

 

Wind Turbines = USW Green Jobs

An industrial-scale wind turbine is a lot bigger than one you might see in a schoolyard or behind someone’s house. The widely used GE 1.5-megawatt model, for example, consists of 116-ft blades atop a 212-ft tower for a total height of 328 feet.

The blades sweep a vertical airspace of just under an acre. The 1.8-megawatt Vestas V90 from Denmark is also common. Its 148-ft blades (sweeping more than 1.5 acres) are on a 262-ft tower, totaling 410 feet. Another model being seen more in the U.S. is the 2-megawatt Gamesa G87 from Spain, which sports 143-ft blades (just under 1.5 acres) on a 256-ft tower, totaling 399 feet.

     Many existing models and new ones being introduced reach well over 400 feet high, the higher towers and extra-long blades being necessary to turn the generator in sites with lower average wind speeds.

     The steel tower is anchored in a platform of more than a thousand tons of cement and steel rebar, 30 to 50 feet across and anywhere from 6 to 30 feet deep. Shafts are sometimes driven down farther to help anchor it, and mountain tops have to be blasted for it. The platform has to stabilize the immense weight of the turbine assembly. The gearbox -- which transforms the slow turning rate of the blades to a faster rotor speed --and the generator are massive pieces of machinery housed in a bus-sized container, called the nacelle, at the top of the tower.

     The blades are attached to the rotor hub at one end of the nacelle. Some nacelles include a helicopter landing pad. On the GE 1.5-megawatt model, the nacelle alone weighs more than 56 tons, the blade assembly weighs more than 36 tons, and the tower itself weighs about 71 tons -- a total weight of 164tons.