ArcelorMittal to shut parts of Liege plant on poor EU demand

World's largest steel maker ArcelorMittal today said it will close a coke plant and six production lines in Belgium hitting 1,300 jobs, a decision which may face resistance from Brussels.

The Lakshmi Mittal-led company, which had shut down the liquid phase steel production facility in the same plant in the Liege region of Eastern Belgium in October, 2011, earlier in the day said "with regret" that it intends to close a number of additional assets.

Belgian Prime Minister Elio Di Rupo, who is in Davos, tweeted: "I support the workers. This is the first message this afternoon at the time of my encounter with Lakshmi Mittal."

ArcelorMittal, which has recently incurred wrath of the French government over closure of two blast furnaces, however, said: "Regrettably, since October 2011, the economic outlook has further deteriorated. Demand for steel in Europe dropped by a further 8-9 per cent in 2012 and is now 29 per cent below pre-crisis levels.

s"This is unsustainable on an on-going basis," it said, adding it thus proposed to close the hot strip mill, one cold rolling flows, two galvanisation and electrogalvanising lines each.

"Additionally, the company is proposing that the coke plant, which is no longer viable due to the excess supply of coke in Europe, also be permanently closed," it said.

The company had closed liquid phase steel production facility in Leige in October 2011, but said that despite the closure, the facility reported an EBIT loss of more than Euro 200 million in first nine months of 2012 and no improvement is foreseen in 2013 due to the continued weakness of European market.

However, it added that operation in five core lines which employ approximately 800 people at the Liege facility would be continued.

On the employees set to be affected with the proposal, it said," ArcelorMittal is committed to finding a socially acceptable solution for all those affected. This will include ...the possibility of reallocation to other sites within the Group."