Steel Mills

ArcelorMittal Mexico, union reach agreement to end 55-day strike

Written by Laura Miller

July 19, 2024

ArcelorMittal Mexico reached an agreement with the local mining union on Thursday, July 18, to end the 55-day blockade of its steelmaking and mining facilities in Lazaro Cardenas, Michoacán.

While a large majority of Section 271 of the Sindicato Nacional de Mineros voted to accept the proposal, a group of unknown size continues to protest illegally and has even turned to violence, according to the company.

ArcelorMittal has asked three levels of the Mexican government to intervene and enforce the rule of law.

Strike’s impact

In a statement, ArcelorMittal outlined “the devastating impact” the strike has had on the company, the community, and the region.

The company estimated its production loss to be 1 million metric tons (mt) of steel. That’s 800,000 mt to date, and 200,000 mt in the mill’s restart.

“The trust of suppliers and customers has been eroded, affecting the company’s reputation and operational efficiency,” it lamented, noting that it will be difficult to recover the canceled orders and business relationships damaged by the event.

Workers’ salaries are based, in part, on performance and results bonuses, the company noted, so workers should temper their expectations for next year’s profit-sharing payments, which will be based on 2024’s results.

The strike has damaged supply chains across various sectors, including construction, automotive, general manufacturing, and domestic and international distribution, ArcelorMittal said.

“It is surprising and worrisome how one union can illegally stop an entire industry,” it noted.

“It is vital that all members of our community understand the magnitude of this crisis,” ArcelorMittal stated. “The illegal strike has not only impacted ArcelorMittal, but our entire community. The stability and economic progress of Lázaro Cárdenas and the state of Michoacán are at stake.

“We must come together to restore labor peace and ensure a prosperous future for all. We request the intervention of all local and national authorities to restore legality and the rule of law by normalizing ArcelorMittal’s operations,” the company added.

‘Historic’ agreement

The union said the more than 3,000 unionized workers made “a historic achievement,” with ArcelorMittal agreeing to pay 100% of the wages lost during the 55-day-long event. Additionally, workers will receive another profit-sharing payment of 60,000 pesos (US$3,322), an 8% salary increase retroactive to May 1, and vouchers for 17,000 pesos (US$941) for social assistance.

ArcelorMittal agreed to complete an external accounting audit of its 2022 and 2023 financial records within 35 days. If the audit finds that the profit-sharing payments were insufficient, the company will have 20 working days to issue the additional payments.

The union said the steelmaker also committed to withdraw criminal complaints against workers and actions to terminate employee and union contracts.

“The miners united until the final victory,” the union declared.

Laura Miller

Laura Miller is a reporter and editor for Steel Market Update. She has held a variety of positions within the steel industry since 2007, including reporting and editing for Steel Business Briefing/Platts, the Association for Iron and Steel Technology, and Kallanish Commodities, as well as marketing for what was then known as ThyssenKrupp Steel USA (now AM/NS Calvert). After a five-year hiatus working across other industries, she returned to steel in 2021 and has covered the flat rolled, tubular, and trade areas of the industry. 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.

Read more from Laura Miller

Latest in Steel Mills