The timing of the resumption of work at the plant of Czech steel producer Liberty Steel Ostrava is still unclear, since negotiations over unpaid debt are still ongoing, and plant workers will remain on paid leave for at least another week.
“Workers will remain on leave paid leave no earlier than January 23,” Petr Slanina, a representative of the largest union at the Kovo plant, told S&P Commodity Insights in a telephone interview on January 15. local plant management. Slanina said another update was expected in a week.
The Czech Republic's largest steel producer has been effectively shut down since Dec. 22, when its sole electricity supplier, Tameh Energy Czech, stopped supplies due to backlogs from the steel company.
Czech company Tameh Energy spokesman Patrick Schrober said in a statement on January 15 that Liberty Steel Ostrava has still not paid a “significant portion” of its outstanding debt.
“For this reason Tameh Energy Czech cannot produce the electricity needed to restart production and the majority of steel workers will remain on furlough,” he added.
Tameh says Liberty Steel Ostrava owes it CZK 500 million ( $22.16 million) in long-term unpaid electricity bills that should have already been paid, with a total debt of approximately CZK. 2.0 billion.
Slanina from Kovo said that the management of the steel plant assured him that “negotiations are ongoing at the highest level between the companies to resolve the dispute over electricity bills so that production can resume.”
Even if Liberty Steel Ostrava employees return next week, it will still take several more weeks to resume normal production, Slanina added.
Liberty spokeswoman Katerina Zaikova said in a Q&A on January 15, that negotiations with Tameh's strategic shareholders "are progressing more slowly than we would like, but we remain confident that we will find a solution in the coming weeks."
"I cannot say when we will restart the blast furnace- 3 and a metallurgical plant," she added.
Zaikova also noted that since the beginning of the year, the European steel market has been showing “growing signs of recovery,” which should be reflected in higher prices for steel products throughout the year. This will help Liberty Steel's optimization plan improve profitability once production resumes by focusing on high value-added products such as seamless and spiral pipes, road barriers, mine supports and threaded rods, it added.
Liberty Steel Ostrava, part of the international GFG alliance led by Sanjeev Gupta, has a production capacity of about 2 million tons per year. It produces rolled products, pipes and flat products, the main consumers of which are the construction, engineering and oil and gas sectors.
