USW reaches labor deal with US Steel

The United Steelworkers International (USW) union reached a tentative labor agreement with US Steel after months of negotiations that put workers on the brink of the first work stoppage in decades.

"We have a tentative agreement with US Steel and unanimous recommendation from [the] bargaining committee," the Pittsburgh-based union said today.

The union said details of the pact would be forthcoming. The collective bargaining agreement will need to be ratified by union members before taking effect.

US Steel workers in September voted to authorize the union's bargaining committee to call the first work stoppage since 1986 if no agreement could be reached.

A strike would have further tightened domestic sheet supply already limited by the US Section 232 tariff and likely supported hot-rolled coil (HRC) prices that have fallen by upward of $100/st from a 10-year high reached this summer.

The USW balked at a series of six-year contract proposals from US Steel that would provide for annual 3-4pc raises in base pay but that the USW said would almost double workers' healthcare costs.

The USW also continues to negotiate with steelmaker ArcelorMittal after its 12,000 workers in September unanimously authorized a strike if necessary.

An update from the union last week showed little signs of progress in disputes over health care coverage, bonus payments, security issues and other benefits.

"Rather than constructively pursuing a settlement that would allow [...] workers to share in the gains of a strong American steel industry, ArcelorMittal management is provoking a work stoppage that promises to bring pain to the communities in which it operates," USW said.

US Steel expects to earn nearly $2bn in 2018, up from $1.1bn in 2017 in what chief executive David Burritt has characterized as a "renaissance" for the company in the wake of a US tariff on imported steel that has boosted domestic producers.

The Pittsburgh-based producer has been among the most buoyant in its support for the Trump administration's action to limit foreign steel imports, restarting two idled blast furnaces at its Granite City, Illinois, sheet mill that prompted a celebratory visit from President Donald Trump in July. Its contract proposal to the USW included a commitment to restart construction of a 1.6mn st/yr electric arc furnace (EAF) at its Fairfield, Alabama, works.

The prior three-year collective bargaining agreement expired on 1 September.