Esmark: ‘Cliff’ to blame for delay of project

YORKVILLE – Esmark officials wanted to rekindle this town’s steel plant as the Ohio Cold Rolling Co. by spring, but they now blame the “fiscal cliff negotiations” for unexpected delays.

“The current steel market conditions and economic uncertainty are two mitigating factors affecting our plans and activities,” said company spokesman Bill Keegan. “There were also broader market concerns over the end-of-year fiscal cliff negotiations that forced buyers to delay new orders until there was more clarity for 2013.”

“We are committed to restarting the Yorkville facility in an orderly process and, hopefully, in a less volatile steel market.”

Esmark spent $4.7 million to purchase the Yorkville mill as part of RG Steel’s bankruptcy and liquidation. After Esmark addressed environmental issues at the site, United Steelworkers Local 1223 members voted 194-24 to accept a new contract in hopes of getting back to work early this year.

USW 1223 President Jerry Conners said the average employee wage in the Esmark deal is $21.64 per hour, down from about $26 per hour under the last RG agreement. Though he said workers were not pleased “to go backward on their wages,” he noted most realized they would have to make some sacrifices to see that the Ohio Cold Rolling startup is a successful venture.

“It was also important to take the necessary time to negotiate a final collective bargaining agreement with the local union that worked for both parties,” said Keegan.

“We certainly understand that there has been speculation about the current status of the Yorkville plant. As we have said previously, there are a number of important factors that are in play at this time, some of which are out of our control.”

Keegan said other issues contributing to Esmark’s difficulties are:

Ensuring commitments on product supply.

The late entry into the annual tin plate contract negotiations process.

The “effect of low-priced foreign imports on the market.”

“It’s reasonable to assume that these factors – and market volatility – all contributed to our current situation,” he added.