YOUNGSTOWN WCI's sinter plant nears closing date

THE VINDICATOR, YOUNGSTOWN
The steelmaker no longer uses sinter to feed its blast furnace because iron ore is cheaper.
By CYNTHIA VINARSKY
VINDICATOR BUSINESS WRITER
YOUNGSTOWN -- WCI Steel is on schedule to idle its Youngstown Sinter Co. on Division Street this weekend, but officials say many of the plant's 58 workers will likely find a place at WCI's Warren facility by summer's end.
Tim Roberts, WCI spokesman, said the company expects to save $2.3 million a year by halting operations at the sinter plant, which the steelmaker has held as a wholly owned subsidiary since 1991.
Most of the plant's hourly and salaried employees have expressed an interest in moving to WCI's integrated steel production mill, he said.
New employees: The company's employee contract with Local 1375 of the United Steelworkers of America stipulates that sinter plant workers must go through the hiring process as new employees, however, and that includes physical examinations and general aptitude testing.
Roberts said officials expect to place all sinter workers who qualify in jobs at WCI by mid- to late-August, but he said it is too soon to say how many will qualify. About 250 WCI veterans have retired since September 1999, so the plant has some openings, he said.
The plant has only three employees laid off, and those are summer hires, not permanent employees.
What plant did: When it was operating, the sinter plant took steel mill waste, such as slag and ash, mixed it with other materials and heated the mix to form sinter, a porous material that was used to feed WCI's blast furnace.
Sinter was about $7 a ton cheaper than iron ore pellets at one time, Roberts said, but market changes have reversed the costs. Now sinter prices are as much as $2 a ton higher, so WCI has switched to iron ore.
The sinter plant will be mothballed and maintained by a skeleton crew of employees so it can be reopened if market conditions change. Although the plant is set to close Sunday, Roberts said, a few employees will remain until the end of the month to complete the mothballing process.
Fiscal charge: WCI took a $3.9 million charge against its second fiscal quarter to reflect the plant idling costs. About $3 million of the charge reflected the decreased value of the company's assets, and the remaining $900,000 was to cover the cost of the shutdown.
Youngstown Sinter was formed by U.S. Steel in 1957 and closed in 1985 by its then-owner, LTV Steel. WCI bought it for $1 in 1989 when it also acquired LTV's Warren works.
WCI ended its second quarter April 30 with a $22.2 million loss, its third consecutive losing quarter. Roberts said he could not discuss the company's financial status so far this quarter, but he noted that the steel industry, in general, continues to be sluggish.