Vale says no talks scheduled with Sudbury workers

Production and Markets

Vale SA said no talks are planned with striking workers at its Sudbury nickel operations in Canada and that the plant remains closed after a planned stoppage.

"There are no talks scheduled at the present time," Cory McPhee, a Toronto-based spokesman for Vale’s nickel unit, said in an e-mailed response to questions. The Sudbury plant, which was scheduled to reopen July 27 after eight weeks of a planned shutdown because of low metal demand, remains closed after workers refused Vale’s latest contract offer, he said.

Vale bought Inco in 2007 to become the world’s second-biggest producer of the metal used in stainless steel. It shut most of its Sudbury operations May 1 for maintenance, extending this into a complete shutdown June 1 after demand slumped.

Chief executive Roger Agnelli said July 7 Sudbury was "not sustainable" and Vale won’t yield to union demands.

"Had the settlement offer been accepted by the union then operations would have begun again on July 27 as planned," Mr
McPhee said in the e-mail. The strike began July 13 after workers rejected Vale’s proposals for Sudbury’s retirement benefits to be contribution-based, rather than benefit-based.

Sudbury produced 85,300t of nickel last year, about 31% of the company’s total output of the metal, but is Vale’s highest-cost operation.

The United Steelworkers’ Union, which represents about 3,100 of Sudbury’s workforce of 5,000, "remains poised" also to go on strike at Vale’s Voisey’s Bay nickel operations in Newfoundland from August 1, McPhee said.

Voisey’s Bay, which can produce 50,000t/y of nickel ore for processing at Sudbury and Vale’s Thompson, Manitoba, plant, was also halted July 1 for market reasons.

Nickel prices leapt as high as US$17,200/t yesterday, 47% higher than its price of US$11,700 on May 1, when maintenance began at the site which accounts for about 10% of the world’s total output of the metal.

"The strike’s impact on tightening the market will mitigate and possibly totally offset Vale’s losses in nickel volumes," according to Mr Rizzuto.

(Bloomberg, July 29)