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U.S. Steel to idle East Chicago Tin, lay off around 150 workers

U.S. Steel plans to idle East Chicago Tin in November, laying off around 150 steelworkers.

U.S. Steel plans to idle East Chicago Tin, laying off around 150 workers, at a time when more than 1,000 workers nationwide are losing their jobs because of a decline in the tin can business.

It will be the second time in four years U.S. Steel has idled the tin mill, a finishing plant that makes tin-plated metal for canned foods, paint cans and other tin products. It's one of Northwest Indiana's "big six" steel mills, along with Gary Works, U.S. Steel's Midwest Plant, ArcelorMittal Burns Harbor, ArcelorMittal Indiana Harbor East and ArcelorMittal Indiana Harbor West.

"Following extensive market analysis of our global competitiveness in light of high levels of low-priced imported tin mill products entering the United States, we have decided to consolidate our current tin mill products production from three to two facilities, idling our East Chicago, Indiana, facility by mid-November 2019," U.S. Steel spokeswoman Meghan Cox said. "Our goal is to place as many East Chicago Tin employees as possible at other nearby U. S. Steel facilities."

ArcelorMittal USA also is laying off 100 workers at the ArcelorMittal Weirton tin mill in West Virginia.

"In order to maintain its position as a competitive and sustainable tin plate producer, ArcelorMittal Weirton will lay off approximately 100 employees for an indefinite period of time," ArcelorMittal spokeswoman Mary Beth Holdford said. "This will occur in phases, beginning this week. The workforce reductions will be realized across the operation with reduced shifts across most production units."

Pittsburgh-based U.S. Steel, one of Northwest Indiana's largest employers, plans to offer about half of East Chicago Tin's 297 employees jobs at Gary Works or the Midwest Plant in Portage. Cox said the exact number of transfers has not been finalized and would be subject to talks with the United Steelworkers union.

The remaining workers will be laid off.

East Chicago Tin, which U.S. Steel acquired from LTV in 2001, employed nearly 400 workers when it was last idled in 2015 during a steel import crisis, when imports captured nearly 30% of the U.S. market share.

U.S. Steel said it would idle East Chicago Tin days after the food production and distribution company Del Monte announced it would shutter two tin canning plants, laying off more than 800 workers. Del Monte cited higher costs that resulted from Section 232 steel tariffs and an ongoing decline in canned food sales as younger consumers gravitate more toward fresh foods.

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As it did with the 2015 tin mill idling, U.S. Steel blamed a flood of cheap imports for the closure. 

"A significant contributor to this decision is our low tin mill capacity utilization driven by the continued high levels of low-priced imports that have captured roughly half of the U.S. tin mill products market. These import levels make operating a three-facility footprint like ours unsustainable under current market conditions," Cox said.

ArcelorMittal also is pointing to imports, as well as the ongoing decline in the tin can market as supermarkets nationwide devote more space to fresh food instead of canned fruits, vegetables or soups.

"This was a very difficult decision to make, but it is necessary to align ArcelorMittal Weirton’s employment levels with challenging market conditions, which include decreased demand for tin-plated cans and pressure from foreign imports," Holdford said.

U.S. Steel also operates tin mills at Gary Works and the Midwest Plant, which will continue operating.

"We have made significant asset revitalization investments in our tin mill production capabilities at our Gary Works and Midwest Plant that have yielded notable quality and delivery improvements, increasing our first-time prime yield and capacity at these facilities. We will be working closely with our customers to ensure a smooth transition during this process," Cox said.

Cox said the East Chicago Tin was being idled and not closed and that the company would monitor market conditions to determine if and when it would reopen.

Check back to nwi.com for updates.

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Business Reporter

Joseph S. Pete is a Lisagor Award-winning business reporter who covers steel, industry, unions, the ports, retail, banking and more. The Indiana University grad has been with The Times since 2013 and blogs about craft beer, culture and the military.