Labor, US steel mills gird for contract negotiations

Steel union members and US integrated steelmakers are getting ready to negotiate contracts in the midst of surging inflation and falling steel prices.

The United Steelworks union (USW) and steelmakers Cleveland-Cliffs and US Steel are getting ready for contract negotiations this summer as multiple contracts expire just as American workers are seeing their purchasing power deteriorate at historic rates and as steel mills brace for lower prices as the US economy faces mounting headwinds.

Inflation was up by 8.6pc in May, the highest in four decades and a third consecutive month at or over 8pc.

The last time the steel mill contracts were negotiated in 2018 the USW voted to authorize strikes at the then-ArcelorMittal USA steel mills and US Steel plants.

The Argus US hot rolled coil (HRC) assessment has fallen by 26pc to $1,118/short ton (st) on 14 June since hitting a peak of $1,500/st in April.

The USW steel mill contracts with integrated steelmakers Cleveland-Cliffs and US Steel expire on 1 September.

At Cleveland-Cliffs, the USW said approximately 12,000 members are covered by the contracts that apply to the former ArcelorMittal USA assets that Cleveland-Cliffs acquired in December 2020.

Based on the contract agreed to in 2018, the sites covered include all of Cleveland-Cliffs' integrated steel mills in Burns Harbor and Indiana Harbor, Indiana, and Cleveland, Ohio. It also covers the EAF operations in Coatesville and Steelton, Pennsylvania, the galvanizing plant in Columbus, Ohio, the cold rolling Tek and Kote plants in New Carlisle, Indiana, the Conshohocken quench and temper plant near Philadelphia, and the tinplate plant in Weirton, West Virginia.

The USW said mining contracts for the company's mines in Minnesota cover about 1,850 union members. Those contracts end on 1 October.

At US Steel, the negotiations cover approximately 11,500 USW members at 10 sites, including all of its integrated steelmaking operations and its Minntac and its iron ore mines in Minnesota, according to the company.

A US Steel spokeswoman said the company looks forward to productive conversations and expects to make an agreement with the union.

In an investor presentation published 1 June, Cleveland-Cliffs highlighted the multiple labor contracts it signed in 2021, including new three-year contracts with the United Auto Workers (UAW) union at its Rockport, Indiana finishing mill and Dearborn, Michigan steel mill, and a four-and-a-half year contract with the UAW union at the company's Mansfield, Ohio stainless steel mill. The International Association of Machinists and Aerospace Workers (IAM) union at Cleveland-Cliffs' Middletown, Ohio, mill also ratified a new contract in 2021.

By Rye Druzin