Corporate plan would permanently end steelmaking jobs at Granite City mill, union says
This story was originally published in the Belleville News-Democrat.
A pending corporate deal would permanently shut down steelmaking operations at the mill in Granite City, cutting an estimated 1,000 jobs.
United States Steel owns the mill and indicated plans to sell two blast furnaces at Granite City Works to SunCoke Energy, Inc., a raw materials handling company. SunCoke would repurpose the furnaces to create a “2 million ton granulated pig iron production facility” there, according to a U.S. Steel letter setting preliminary terms of the deal.
“The announced potential agreement could cause the permanent shutdown of the steel making and finishing operations at the Granite City Works,” said Local 1899 Union President Dan Simmons.
Pig iron is a crude material that can fuel electric arc furnaces used to make steel. Repurposing the blast furnaces and building a new facility at the site of the mill could mean the loss of nearly 1,000 jobs, the union estimates.
“In pursuit of financial greed, (United States Steel) plans to shut down these vital resources and turn its back on both the skilled, hard-working steelworkers who have made this company successful,” Simmons said.
Under the company’s plan, U.S. Steel would sell iron ore from its own mines to SunCoke. SunCoke would sell all of the material back to U.S. Steel for use in its own “mini mill” in Arkansas and other locations, creating a “significant cost advantage,” according to the letter.
“We want to be as self-sufficient as possible,” said U.S. Steel spokesperson Amanda Malkowski. Roughly 1,500 people work at the Granite City mill, according to Malkowski.
If the deal goes through pending board and regulatory approval, there would be an estimated 550 jobs remaining, Malkowski said. There would be no impact on jobs for two years, the spokesperson said, as the companies finalize the deal, obtain permits and construct the pig iron facility. The deal is expected to close this summer.
Malkowski declined to say how much the deal is worth. U.S. Steel Inc. purchased Granite City Steel from National Steel out of bankruptcy in 2003 and renamed the plant U.S. Steel-Granite City Works.
Workers from Granite City will be offered incentives to transfer to other U.S. Steel facilities, and they will be eligible for continued health care and supplemental unemployment benefits, Malkowski said.
“We’ve been part of the community for a long time, and we’ve been having conversations with our employees on the ground there to help them prepare as much as possible,” Malkowski said. Simmons called the plan “a betrayal.”
The mill has been making steel since 1895. Steel works first began in Granite City in 1878 under brothers William and Frederick Niedringhaus, who established Granite Iron Rolling Mills where they manufacture sheet iron.
“The shutdown of steelmaking and finishing operations at Granite City Works is a betrayal by USS of its workers and of the Granite City community,” Simmons said. Former President Donald Trump visited the mill in 2018 to defend his administration’s trade deals, which he claimed saved hundreds of jobs at the facility.
This story is developing and will be updated.
Kelsey Landis is a reporter with the Belleville News-Democrat, a news partner of St. Louis Public Radio.