TPT September 2007

From the AmericaS

company, Canada’s last domestically owned steel maker. Other options under a review begun 1 June include mergers, partnerships, and status quo – although that seems an unlikely course. Stelco reported a net loss of C$39 million (US$36.8 million) in the first quarter of this year and a net loss of US$136.7 million in the last quarter of 2006. Stelco emerged from bankruptcy in March 2006, restructured but obligated to discharge, over a ten-year period, US$695.5 million in debt and with a pension shortfall of US$636.1 million. The company’s main resources are integrated steel operations in Hamilton and Nanticoke, also in Ontario, producing high quality value-added hot rolled, cold rolled, coated sheet, and bar products. The Lake Erie mill at Nanticoke has been renovated and expanded, and the upgrade continues. The much older Hamilton works is outdated and outright unprofitable. Even with its burdens – including a contentious relationship with the United Steelworkers union – Stelco is one of Canada’s largest steel makers and attractive on that score alone. Rodney Mott, its president and chief executive officer, said the company aspires to be “an integral part of a larger, globally competitive company.” While Mr Mott’s statement did not identify potential buyers or partners, the trend in steel industry consolidation suggests that these would not be Canadian. Foreign buyers have gradually taken over Canada’s other steel companies, most recently Ipsco Inc, which is being acquired by Sweden’s Svenskt Stal AB (SSAB). Deutsche Bank, of Germany, expressed interest in Stelco during its prolonged period in bankruptcy,

as did Severstal, the second-largest steel company in Russia. Severstal established a foothold in North America with the purchase from Ford Motor Co of Rouge Steel Co in 2004. The Rouge mill is in Dearborn, Michigan, nearby Stelco’s businesses in Ontario.

Wind turbines circulate on a storied Bethlehem Steel site

Steel Winds, a ‘wind farm’ in the upstate New York city of Lackawanna, occupies the site of a former Bethlehem Steel plant which closed down in 1983 after 80 years of production. Now, eight windmills with 153ft blades harvest 56,000 megawatt-hours of electricity per year from the winds off Lake Erie: enough to provide power to 7,000 homes. At its peak during and following World War II, Bethlehem employed more than 20,000 people in Lackawanna. But the jobs vanished, and today the last vestige of the steel behemoth is a small finishing mill for galvanized steel, operated by Mittal Steel. Mittal acquired bankrupt Bethlehem’s assets in 2005 in a merger with International Steel Group. Steel Winds is the largest such operation within city precincts. And, according to the state Department of Environmental Conservation, it is the first to rise on land overseen by New York’s program to recover so-called brownfields: the low-level toxic waste sites concentrated mainly around abandoned factories. “It’s a way to convert the Rust Belt to the Wind Belt,” said Christine Real de Azua, of the American Wind Energy Association.

125

S eptember /O ctober 2007