Steel Mills

ArcelorMittal Mexico readies to end labor relations with striking union members

June 25, 2024

ArcelorMittal Mexico said it’s on the brink of severing labor relations with striking members of the local mining union. This serious move comes as an illegal strike and the resulting mill outage persist into their second month, posing a significant threat to the continuation of the mill’s operations.

The protest and blockade of the company’s Lazaro Cardenas mill and Las Truchas mines in the state of Michoacán began on May 24 over disputed profit-sharing payments. As it started before the union had initiated proper strike procedures, a Mexican judge ruled the strike illegal.

Another recent ruling by a federal judge against the Sindicato Minero mining union’s request for certain protections means ArcelorMittal is now legally able to terminate individual and collective relationships with protesting Section 271 union members.

ArcelorMittal has reiterated its call for the union members to correct their actions, relinquish control of the facilities, and resume work. The company’s statement on June 20 emphasized that ArcelorMittal is fully authorized to proceed with the procedures for terminating individual and collective relationships.

In an earlier statement, ArcelorMittal underscored the detrimental effects of the illegal strike, stating that it has caused “irreparable damage” to the mill and mining equipment and “considerable million-dollar losses to the company.”

The Lazaro Cardenas mill has one blast furnace for long products and four electric-arc furnaces for flats, with a total annual production capacity of 5.3 million metric tons (mt). The mill’s 2.5-million-mt-per-year hot-strip mill (HSM) began operating in 2021. According to a May presentation, the HSM was operating at ~65% of capacity before the strike.

The mill has suffered a significant production loss over the past month, with SMU estimating the loss to now be between 260,000 and 400,000 mt of steel.

The completion of a $150-million expansion to double pellet production at the company’s Las Truchas mining ops is slated for next year.

ArcelorMittal and Sindicato Minero have not returned multiple requests for comment.

Laura Miller

Laura Miller is a reporter and editor for Steel Market Update. Since 2007, she has held various editorial and marketing positions with steel industry publications, associations, and mills. In 2021, after a five-year hiatus working across other industries, she returned to steel trade journalism, joining SMU in 2022. She is a member of the Association of Women in the Metal Industries and a past-president of the AWMI Pittsburgh Chapter. She holds a BA in Latin American Studies from Edinboro University of Pennsylvania. She can be reached at laura@steelmarketupdate.com or 724-759-7869.