GRANITE CITY – Union officials and regional leaders vowed Wednesday to fight deep cuts at a century-old steel mill here, in the crosshairs of a company that is shifting gears.
Pittsburgh-based US Steel Corp., owner of the plant, said this week that it is working on plans to sell major parts of Granite City Works to Chicago-based Sun Cook Energy and end the steel industry in late 2024. Nearly 1,000 jobs will be cut.
US Steel said it will continue to finish steel at the plant, and Sun Cook plans to convert the facility’s blast furnaces to a two-million-ton “iron ore” process to produce the building blocks for steelmaking at the company’s other facilities. But this would only maintain about a third of the current workforce.
Dan Simmons, president of the local branch of United Steelworkers, called the decision a betrayal.
“Today, Granite City Works is a feasible and profitable steel business,” Simmons said in a statement. “However, in pursuit of financial greed, USS plans to turn its back on both the skilled, hard-working steelworkers who made this company successful and the society that sustained it.”
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Officials vowed to fight job losses. “Granite City is a city of fighters, and we’re making our stomachs straight to fight this,” Mayor Mike Parkinson said.
But for the company, it fits in with the “better, not bigger” build strategy. US Steel, one of the nation’s largest steel companies, has given news to investors that it is repurposing an old coal-fired plant to supply its growing fleet of newer, more efficient electric-powered operations. It is a step already taken by competitors. “It’s safer, cleaner, and cheaper,” said steel industry analyst Gordon Johnson, founder of GLJ Research in New York.
There has been a steel mill in Granite City longer than there has been in Granite City.
Louis industrialists looking to make steel on cheap land across the river opened the factory that would become Granite City Works in 1895, a year before the city was founded. Rolled sheets were provided to a sister stamp factory.
By the end of the following decade, it employed more than 1,000 people and had taken its place as the cornerstone of a city with connections to 10 railways that called itself the “City of Major Industries”.
But when foreign competition and a collapse in demand led to the collapse of the industry in the 1970s and 1980s, Granite City went with it. The factory’s workforce declined from a peak of 5,000 in the mid-1970s to 2,800 by late 1982.
US Steel bought the operation in 2003 from bankrupt National Steel and, five years later, closed the plant, sending the town reeling. Cafes saw their lunch orders as dry. The trucks that were going in and out of the factory disappeared. Thousands of workers poured into the unemployment line. They returned the following year, but in 2015, it happened again.
When former President Donald Trump announced new import taxes in 2018 and reopened US Steel, there was hope that the good times would return. Trump himself came to Granite City and delivered that very message.
“We’re watching this closely, and it’s just going up, Dave,” Trump told US Steel CEO David Burrett, who joined the president on stage during his speech.
But the following year, US Steel spent $700 million to buy a stake in the Big River Steel mill in northeastern Arkansas and its cleaner, cheaper electric furnaces, making a move it once resisted.
Analysts then asked Burrett if buying Big River would mean a shutdown in Granite City. He described their suggestions as premature.
But on Tuesday, the call came and the fears started again.
“These guys pay really well,” said Mayor Parkinson.
The last time the place closed, people lost their cars and homes, said Craig McKee, a vice president at the local union.
Parkinson said he’s doing everything he can to stave off this. He spent the morning going from phone call to phone call to reach out to the company, state officials, and the state’s congressional delegation for assistance.
He said the company had tried to pull out of Granite City before, and they hadn’t succeeded yet.
But McKey, who has worked at the plant for more than 25 years, was worried that this time it might be the one to do so.
He said, “I fear the worst.”
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