ArcelorMittal Spain in talks with workers’ unions to lay off most workers until end 2023

ArcelorMittal Spain has proposed a national level layoff program which could potentially halt production at all of its plants in the country until the end of 2023 with the exception of its tube-production works, a company spokesperson told S&P Global commodity Insights Sept. 16.

Talks with workers’ representatives to assess the application of the program started Sep. 14 and would continue for 15 days, the spokesperson said.

The company cited Sept. 16 an “adverse situation in the market, with low demand and a high volume of imports from outside the EU trading bloc,” which already led it postpone the restart of its 2 million mt/year electric arc furnace at Sestao after concluding maintenance in August and a partial closure at its 4.5 million mt/year Gijon plant at the end of September.

The company has made a temporary layoff proposal to workers at these and nine other sites in Spain with the exception of the Condesa tube plant it purchased in 2021, which covers for a period through to Dec. 31, 2023.

These types of layoff plans, known as ERTEs in Spain, can usually be reversed if market conditions change, allowing individual plants to restart independently.

A total of 8,300 employees would potentially be affected by the ERTE.

ArcelorMittal Spain said Sept. 1 that it is facing unfair competition in the steel market from “non-EU producers that are not affected by the increasing costs linked to the EU Emissions Trading System,” and supports a “carbon border adjustment mechanism that sets a framework in which each region, each country, must contribute in an equitable manner.”

Platts daily assessment for HRC in Southern Europe has declined 9.1% since the start of 2022 to Eur760/mt ex-works Italy Sept. 15, according to S&P Global Commodity Insights data.

According to a demand index from grid operator Red Electrica, power demand from the iron, steel and alloy sector fell 27% year on year in July and was down 9% for the year to July.

Besides ArcelorMittal, silicon metal and silicon and manganese ferroalloys producer Ferroglobe told S&P Global Sept. 1 it had temporarily shut down the furnaces at all its plants in Spain – Sabon (Galicia), Boo (Cantabria) and Monzon (Aragon).

Meanwhile, stainless steelmaker Acerinox had temporarily laid off workers for 15 days from Sept. 1 at its 1 million mt/year Los Barrios facility, affecting the melting shop, hot rolling mill and hot annealing line, but was unavailable Sept. 16 to confirm if the halt would be extended.

— Gianluca Baratti