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TitleIron Ore Pellets from Brazil
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Page 1

IRON ORE PELLE·TS FROM BRAZIL

Determination of the Commission In
Investigation No. 701-TA-235
{Final) Under the Tariff Act of
1930, Together With the
Information Obtained In the
Investigation

USITC .PUBLICATION 1880

JULY 1988

United States International Trade Commission I Washington, DC 20436

Page 2

_,

UNITED STATES INTERNATIONAL TRADE COMMISSION

COMMISSIONERS

Susan Liebeler, Chairman
Anne E. Brunsdale, Vice Chairman

Paula Stern
Alfred E. Eckes

Seeley G. Lodwick
David 8. Rohr

Staff Assigned:

Cynthia Wilson, Office of Investigations
Laszlo Boszormenyi, Office of Industries

John Ryan, Office of Economics
Chandrakant Mehta, Office of Investigations

Marcia Sundeen, Office of the General Counsel

Robert Carpenter, Supervisory Investigator

Address all communications to
Kenneth R. Mason, Secretary to the Commission

United States International Trade Commission
Washington, DC 20436

Page 60

A-20

Table 6.--Average number of all employees and production and related workers
in U.S. establishments producing iron ore pellets, and hours worked, total
hourly wages, average hourly. wages, total compensation, average hourly
compensa.tion, and output. per hour of production and related workers
producing iron ore pellets,. 1983-85, January-March 1985, and January-March
1986

I-tem·
. :

Average number of employees: :
All persons-~---------~----:
Production and relat~~

workers producing:
All products-------------:
Iron ore pellets---~-----:

Hours.worked by production :
and related workers
producing iron ore pel~ets

1,000.hours--:
Wages paid to production and :

·related workers prod~cing
iron ore pellets

. 1,000 doil~rs--:
Average hourly wages pf

production and rela~~~
workers producing i~oq
ore pellets------~-~~~-----:

Total compensation of ·
production and related
workers producing iron ore
pellets----1,000 dopars--:

Average hourly compensation
of ·product:t.on and :r~,1.at;ec:l
workers producing irop
ore pellets--------~~-~----:

Output of production ~n~ ·
related workers producing
iron ore pellets ·

long tons per hour-:

8,724

6,400
6,305

11,652

162,281

$13.93

249,757

. ,. . . .

$21.43 :

·3.07 . .
. . ·•

1984.

10,036

7,776
7,678

14,609

202,782

$13.88

282,513

: .

:

. .

.1985 J:.l

8,690

6,959
6,860

12,487

185,125

$14.82

257,766

$19~34 :2/ $21.01

.. .
. 3.44 3.80

:January-March--
·~~~~~~~~

1985 1986

8,120

6,451
6,346

2,990

41, 77 5

$13.97

61,180

$20.46

·3.36

6,734

5,121
5,025

2,568

39,203

$15.27

56,661

$22.06

3.87

.1/ Employment informaUon for the ·Butler Taconite Mine in 1985 are for 28
· weeks only, since the 'mine shut down on June 29, 1985.

l:_/ Excluding * * *; which did riot provide total compensation data for * * *·
Source: Compiled fr,om data submitted in response to questionnaires of the

U.S. International Trade Commission •
..

Note.--The figures for January-March 1985 and J~nuary-March 1986 exclude
data for * * *, which accounted for *** percent of pellet production in 1985.

Page 61

A-21

.. The average hourly wage paid to workers producing iron ore pellets
dropped fr~m $13.93.in .. 1983_to'$i3;88.i_n 1984',_·then·rose to $15.27 during·

. January-March 1986. Total hourly compensation, Jncluding fringe benefits,
followed a similar trend. The declines after 1982 may be attributed to
concessions resulting from a. 41-month labor .agr.eell!,ent; entered into in March

· l983 between the USWA and steel and pellet producers. l/ The same wage and
benefit: cuts were accepted for workers in both· the steel and pellet
industries. The productivity of workers producing iron ore pellets increased
by 23.8· percent from-J.983 to 1985. During Janua,:y-Har:ch.19~(), productivity
was up 15.2 percen~ over Janu~ry-M~rch 1985.

S~yeri ~f the-eight o~erat~ts t~ported spec~fic instahces of reductions in
the number of p~oduction and related workers producing iro'il ore· pellets as a
result of decreased demand for pellets. In 1983, 2,600 workers were laid off;
nearly 500 were not ca].led ba~k. In 1984, three operators reported layoffs
affecting some 4,000 workers; all but 600. of those were called back. Also in
198~, another operator reported rehiring 9ver ***workers from earlier·
layoffs. In June 1985,' the permanent closure of the Butler Taconite Mine put
an estima·i:ed *** workers out of· work. Near the· end of 1985, the downsizing of
another pellet operation (* * *) permanently laid off *** workers. Two other
operators reported temporary shutdowns or cutbacks. in 1985 affecting nearly
4,000 .. wor!.<ers; alm9st _all of these were recalled. Production cutbacks during
January-March 1986 were responsible' for almost ·2,200· workers being laid off, ·
of which about JOO wer~ for an indefinite period.

Financial experience of U •. s. producers

Income-and-loss data were.requested from each operator of iron ore mines
concerning the total iron ore mining and pelletizing operations of the mines
they operate. Further financial data were requested from each operator and/or
equity- owner on their commercial sales of fron ore pellets.

Operators' total mining and·pelletlzing operations.;,.....;Data for iron ore
pelle.ts relating to transactions_ with owners of mines are presented in
table 7. The firms submitting ~uch data accounted for··100 percent of·
shipments of iron ore pellets in 1985. ·Net' sales are valued on the basis of
published Lower Lakes prices, which do not necessarily refi'ect market
prices. 2/ The operators transfer the iron ore pellets' to equity owners by
using some version of the Lower Lakes P.rice-' to obtain the ·largest depletion
allowance for tax purposes; depletion allowances are calculated on the basis

.•· ·'

1/ The USWA re_presents' productfon and related workers at all· pelletizing
.. plants except Pea Ridge,_ which has. no union representation;.·· , .
· · 2/ The Lower Lakes" price· can be cha'rac·tedzed ·as i:i compo'site of the

published prices bf the four merchant companies'. a'nd U.S. Steel Corp~ See the
price section o.f this report for a discussion of the Lower Lakes price.

Page 120

UNITED STATES

INTERNATIONAL TRADE COMMISSION
WASHINGTON. D.C. 204l6

OfFICIAL Bu&INUI

ADaMSI CDllMCTIOlll lllQUDTID

ADDRESS CHANGE
O Remove from. Ust
O Chan1e aa Shown

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label and mall to address - -

Postage And Fees Paid
U.S. International Trade Commission ~ -... _

ITC-853

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