This morning, U.S. Steel announced 700 impending layoffs at MinnTac, the Iron Range's largest taconite plant. U.S. Steel U.S. Steel to idle Keewatin Taconite, affecting 400 workers the idling of its Keewatin Taconite property on the western Mesabi. The MinnTac layoffs are slated to begin June 1.
I had a conversation with a construction worker who was on a crew at MinnTac recently. He was amazed at how much ore was stockpiled on site and told me that it didn't look good. You can't always believe what a company says, but you'd better believe their supply and demand issues.
If you've read much about mines this spring, it's probably been in context of the debate over wild rice sulfate rules and new legislation drafted to help mines like MinnTac. My Sunday commentary explained that this focus overlooks a much bigger problem in North American mining and the economy of Northern Minnesota.
Meantime, the grim news from U.S. Steel's website:
PITTSBURGH, March 31, 2015 -- United States Steel Corporation (NYSE: X) announced today it will adjust operations and temporarily idle a portion of its Minnesota Ore Operations – Minntac plant in Mt. Iron, Minn., effective June 1. This action is due to the company's current inventory levels and ongoing adjustment of its steelmaking operations throughout North America. The company will continue to operate Minntac at reduced capacity in order to meet customer demand.
The company routinely adjusts production at its operating facilities to reflect market fluctuations. These ongoing operational adjustments are a result of challenging market conditions that reflect the cyclical nature of the industry. Global influences in the market, including a high level of imports, unfairly traded products and reduced steel prices, continue to have an impact. As part of the temporary idling, all employees at Minntac have been advised of the upcoming temporary idling and are being issued notices under the Worker Adjustment and Retraining Notification (WARN) Act. The number of employees impacted will be based upon operational and, or maintenance needs.