The battle between Canadian government and United States Steel Corporation has heated up after Lakeside Steel Inc intervened to say that US Steel treats its Canadian operations as merely overflow facilities.
Lakeside Steel Inc wants to buy the Stelco assets itself. It won intervenor status in the Stelco lawsuit, and used it to file a massive submission this week that alleges that US Steel favors its US operations over the Canadian ones because it wants to get U.S. stimulus orders that require it to uphold the "Buy American" rules in the stimulus package.
Mr Vic Alboini chairman of Lakeside said that "That's the key driver here. It means that Canada is substantially disadvantaged."
In its submission to the court, Lakeside noted that since January of this year, only 46% of U.S. Steel's production capacity in the United States has been shut down at any one time, and less than 39% of its employees were laid off at any one time. By comparison, almost all of its Canadian hourly work force is laid off and Stelco's steel mills in Hamilton and Nanticoke are shut down.
Mr Randy Sockovie director of sales and marketing at Lakeside said that "I conclude that US Steel does not need and has no incentive to utilize, Hamilton and Nanticoke's production capacity, except when U.S. Steel has under capacity in the US. In other words, U.S. Steel treats the Canadian facilities as overflow facilities."
Lakeside's submission comes just as Canada and the US appear to be making progress on a deal to exempt Canada from the Buy American rules.
To Mr Alboini, the appropriate measure is to put the Stelco assets back up for sale. Lakeside, which is made up of former Stelco assets, wants a chance to buy them. He said that U.S. Steel is trying to delay its legal battle with the government for as long as possible on the hopes that the economy will continue to improve and it can re-start one of the Canadian mills on its own to save face.
(Sourced from www.nationalpost.com)
