May 5, 2017 / 3:44 PM / in 7 months

Union gives ArcelorMittal strike notice for Quebec mine

TORONTO (Reuters) - Unionized workers at ArcelorMittal’s ISPA.AS Mont-Wright iron ore mine in northern Quebec gave the steelmaker, the world’s largest, a 72-hour strike notice after rejecting the company’s contract offer, the United Steelworkers union said on Friday.

The two sides have since agreed to resume negotiations in Montreal, but some 2,000 workers will walk off the job at noon Monday if outstanding issues are not resolved, said Dominic Lemieux, assistant to the union’s Quebec director.

The union has concerns with wages, pensions, sub-contracting and lower pay for workers at the company’s nearby smaller mine, Lemieux said.

A strike would affect the large open pit Mont-Wright mine, a railroad link to port, a processing plant in Port Cartier and the smaller Fire Lake mine.

The company would not comment on contingency plans for operating the plant during a strike. Last year, Mont-Wright produced some 27 million tonnes of iron ore at a cash production cost of $25 per ton.

ArcelorMittal spokesman Paul Wilson said the company is confident a deal will be reached. “We are still convinced that we are going to get there and that we’re going to get a win-win solution,” he said.

A week of mediated talks in late April failed to resolve financial issues in the contract, which expired March 1, Lemieux said.

Spot iron ore prices .IO62-CNO=MB slid 5.1 percent to $65.20 a ton on Thursday, according to Metal Bulletin, on worries about slowing construction and infrastructure demand. That is down from an all-time high of about $190 in 2011.

Luxembourg-based ArcelorMittal suspended an expansion plan at Mont-Wright last June, citing project costs, “fairly high” mine production costs, low iron ore prices and global competition.

In 2013, ArcelorMittal sold a 15 percent stake in Mont-Wright to South Korean steelmaker Posco 005490.KS and Taiwan listed China Steel Corp 2002.TW for $1.1 billion.

Reporting by Susan Taylor; Editing by Steve Orlofsky, Bernard Orr

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