Investment and restructuring of steel production (Canada)

ArcelorMittal has announced plans to build a $380 million beam mill in Contrecœur and to restructure its steel production activities in Canada. Flat carbon production will be consolidated in Hamilton (Dofasco Facility) and long carbon production in Contrecœur (ArcelorMittal Montreal). The Contrecœur site will close down its hot mill operations on January 31 and its cold mill operations on February 29.

For employees affected by the restructuring, ArcelorMittal will work with the United Steelworkers union and government officials to facilitate this transition through regulatory and labour contract mechanisms. As a significant number of Contrecœur employees will retire in 2008 this should almost eliminate the impact of job losses on employees.

According to Jos Jacqué, CEO, Long Carbon, North America, ArcelorMittal wants to develop a sustainable Canadian steel business. With the former Dofasco facility now part of ArcelorMittal in Hamilton, it does not make business sense to have Contrecœur compete with a sister company in the flat carbon segment while Dofasco has unused capacity.

Other factors cited are the exchange rate, the cost of metallics and significant increases in iron ore and natural gas prices.