US Steel Idles Illinois Furnace in Response to UAW Strike

U.S. Steel will temporarily idle a Granite City 'B' furnace near St. Louis in response to the United Auto Workers strike.
US Steel Idles Illinois Furnace in Response to UAW Strike
A worker trims a newly cast steel slab at the NLMK Indiana steel mill in Portage, Indiana, on March 15, 2018. (Scott Olson/Getty Images)
Andrew Moran

U.S. Steel says it will temporarily idle operations at a facility near St. Louis in response to the United Auto Workers (UAW) strike, The Epoch Times has learned.

The steelmaker will idle blast furnace "B" at Granite City Works, specifically the primary operation. This mill manufactures hot- and cold-rolled and coated sheets for customers in various sectors, including the automobile and construction industries.

"This temporary idling is due to the execution of our risk-mitigation plan as a result of the autoworkers strike," U.S. Steel said in a message to employees. "The plan ensures that our melt capacity is balanced with our order book. We will continue to monitor market conditions and adjust accordingly."

This action will happen as soon as it's possibly safe, the Pittsburgh-based company noted.

Granite City maintains two blast furnaces: "A" and "B." The former was made indefinitely inactive in April 2020. By idling the latter, the mill wouldn't conduct any melting.

United Steelworkers (USW) leaders were informed on Sept. 18 about U.S. Steel's decision, and they plan to meet with company officials soon, Local 1899 President Dan Simmons said.

"The company is claiming this decision is due to a combination of order book softening throughout the corporation, specifically in the auto industry," Mr. Simmons wrote to USW members. "We will be meeting with the company to put together a layoff minimization plan per the contract. We will keep you informed as this all unfolds."

The latest decision comes as nearly two dozen mills typically engage in planned fall maintenance outages. It's estimated that as many as 1 million tons will be removed from the market from September to November. Industry experts note that it's unclear if these outages will affect prices, considering how tight the market has been this year.

According to the American Iron and Steel Institute, the utilization rate among U.S. steel mills has been about 76 percent since the spring. Meanwhile, raw steel production has been trending downward in recent weeks, sliding to about 1.68 million net tons.

U.S. Steel and USW didn't respond by press time to requests for comment.

UAW Strike

Thousands of UAW-represented workers walked off the job when their contracts expired at 11:59 p.m. EST on Sept. 14. The roughly 13,000 employees picketed at three different factories belonging to Ford, General Motors, and Stellantis simultaneously, the first time in the organization’s 88-year history.

As the strike enters its fourth day, no resolution appears to be in sight, which could impact the U.S. economy and President Joe Biden’s green energy agenda.

“A lasting strike is looking highly probable,” Standard & Poor's analysts wrote in a report published on Sept. 18. “The current political and economic conditions increase the odds of a longer strike.”

The UAW leadership is asking for a four-year contract that includes a 40 percent pay raise, a 32-hour work week with 40-hour pay, and the restoration of a cost-of-living adjustment and traditional retirement pension and benefits. All three parties have provided counterproposals that UAW President Shawn Fain has described as “insulting.”

“They pretend that the sky will fall if we get our fair share of the quarter of a trillion dollars the Big Three has made over the past decade,” Mr. Fain said in a recent video. “They want to say that our righteous fight for a higher quality of life for the working class would wreck the economy. We’re not going to wreck the economy, we’re going to wreck their economy because it only works for the billionaire class.”

Andrew Moran has been writing about business, economics, and finance for more than a decade. He is the author of "The War on Cash."
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