Lackawanna company being hurt by steel tariffs

Posted at 12:29 PM, Jul 31, 2018
and last updated 2018-07-31 18:07:42-04

The Welded Tube ERW casing mill in Lackawanna is feeling the negative effects of the U.S. tariffs imposed on the import of steel from Canada, Mexico and the European Union.  The mill was constructed in 2012 and started production in 2013.

Welded Tube is based in Concord, Ontario and operates facilities in both the U.S. and Canada.  It produces steel tubular products for a variety of applications.

Prior to the 25% steel tariffs being imposed by the Trump administration on June 1st, Welded Tube would ship products made at its Ontario and Lackawanna facilities back-and-forth across the border for processing and distribution.

Lackawanna was tasked with running all of the company's product for the energy industry (oil & gas).

The tariffs have made that financially unfeasible, explained John Young, Welded Tube Executive Vice President & COO.

Young said the tariffs have forced the corporation to move all of its work for the Canadian market back to Canada - meaning jobs and production at Lackawanna have been scaled back:

-106 workers were laid off for a one-week period starting July 2nd.

-The mill is now on a 3-week plant shutdown until August 20th.

-The facility has been "crewed-down" from a 3-crew operation to a 2-crew operation taking the plant from 75% capacity to 50% capacity.

-25 workers were laid off this past weekend.

-Additional phases of expansion have been put on hold.

Welded Tube is hoping the tariff situation will not last longer than 3 or 4 months.  However, if it is not resolved, Young said it is hard to say what sort of impact it could have long-term on the Lackawanna facility.

"Frustrating," explained Young, who said Welded Tube USA: Lackawanna was doing "exceptional" prior to the June 1st tariffs and there was a strong commitment from the corporation for its future

Welded Tube has reached out to officials in both Canada and the U.S. to express its concerns about the tariffs.

Workers at the Lackawanna facility have also sent a petition to federal lawmakers on the issue.

7 Eyewitness News Reporter Ed Reilly talked with John Young by phone and visited the Welded Tube USA facility in Lackawanna.




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