Occasionally, Steel Market Update post articles on our Blog which we do not publish in our newsletter. Recently, we posted a blog regarding the USS Hamilton lockout situation and attempted to clarify a couple of statements made by Local 1005 concerning the steel market and pricing.

The union has responded to our comments as well as by comments in their local press which I assume have not been supportive of the union position.

Mr. Rolf Gerstenberger, President, USW Local 1005, in an update to its members dated August 12, 2011 and entitled: "What it Means to Be Realistic" pointed out the following: Price fluctuations in steel are a concern to Local 1005 as the union believes them to be detrimental to the economy.

The union believes "...concessions from workers generally are detrimental to the economy, lead to a widening gap between the working class and owners of capital, intensify the imbalance between production and consumption, and are a major factor in recurring economic crises such as the 2008 recession that refuses to loosen its grip."

The USS Hamilton union president continues to position the union against U.S. Steel and all "foreign" ownership of the steel capacity in Canada (Essar Steel Algoma has ownership out of India, ArcelorMittal Dofasco is also foreign owned and the last Canadian flat rolled producer is USS Hamilton and their sister company USS Lake Erie). The union's belief is Canada (or Canadian companies) should control vital assets which support their economy. Steel being one of those assets.

In the latest union message, Mr. Gerstenberger points out an offer the union made to USS which could be worth more than tossing aside the indexing of those already retired and taking the existing pension from any new hires. Mr. Gerstenberger said, "We offered to go together with U.S. Steel to the Ontario government to renegotiate the terms of the pension plan fund, to extend the time before the plan is made solvent to 2020 rather than 2015 with the same forgivable $100 million loan. This considerable concession alone, which we are still willing to undertake, would be worth more to the company than stopping pension indexing and new hires from having a defined-benefit pension plan."

Steel Market Update has not taken a position in support of either the union or the company. We hope the two sides will at least go back to the bargaining table to see if they are able to resolve their differences and allow the good workers in Hamilton the ability to go back to work and support their families.

The lockout began on November 7, 2011 and is now in its 10th month. You can view our blog post, union response and recent local press article by clicking on the links above.