Home | BaltimoreBrew.com

Maryland officials seek ways to help Sparrows Point, while company offers no guarantees

Will the furnaces reopen? It all depends on the economy, Kuznetsov said.

Above: Congressman CA “Dutch” Ruppersberger coordinated the meeting at Sparrows Point, which brought together elected officials, labor leaders and plant owner, Severstal.

Maryland’s top elected officials offered “to do whatever is possible” to help the Russian owner of the Sparrows Point steel mill, while the company repeated its complaint that a slow economy and expensive raw materials have forced the shutdown of most of the mill.

A motorcade of official cars arrived yesterday at the general offices of Severstal Sparrows Point as Gov. Martin O’Malley, Senators Benjamin L. Cardin and Barbara A. Mikulski, Congressmen C.A. “Dutch” Ruppersberger and John Sarbanes, Baltimore County Executive Jim Smith and the “Eastside” delegation from the General Assembly met with Sergei Kuznetsov, CEO of Severstal North America, who flew in from Detroit.

Also in attendance were Christian Johansson, Maryland Secretary of Business and Economic Development, and David Iannucci, executive director of Baltimore County Economic Development.

Only two representatives of the United Steelworkers were permitted by Severstal to attend the meeting – Local 9477 President John Cirri and USW Sub-District 1 Representative Jim Strong.

Kuznetsov told the group that Sparrows Point was losing money as a result of the depressed state of the construction industry and because raw material prices were high and unpredictable, according to a person who attended the meeting. He offered no promises when the steel-making furnaces might reopen, saying it all depended on the economy.

Following the meeting, Severstal spokesperson Marika Diamond told The Brew, “Management felt the meeting was worthwhile and productive – a sincere effort to work together for the future success of Sparrows Point.”

Help in Tough Times

Congressman Ruppersberger, who organized the meeting, called it an important first step for Maryland government to team up with Severstal.

“The goal is to help them during the tough times,” he said. “It’s all about jobs. The company told us, ‘We’re not making a profit.’ We’re saying, ‘We will work with you. Profit and jobs are our priority. You need to keep open and keep people working.’ ”

Although coming a week before the Nov. 2 elections, Ruppersberger said the meeting had nothing to do with politics. Rather, he said, “it’s about incumbent officeholders trying to find ways to help an industry that’s very important in our state. Steel in this region is part of our culture.”

With Sparrows Point barely working and hundreds on layoff, steelworkers attending a rally at the Local 9477 union hall last night expressed concern about the mill’s future.

“We’re happy the politicians are starting to take an interest, but most of us think the company’s never going to cooperate,” said a steelworker who still has a job but expects to be laid off soon.

“Either Run It or Sell It”

Severstal has refused to confirm or deny widespread reports, including on this website, that it is trying to sell Sparrows and two other underperforming mills.
Last Friday was the deadline for bids by potential buyers.

“Either run it or sell it,” said the steelworker, commenting on the mill’s uncertain status under Severstal management.

Ruppersberger said there was no discussion about a possible sale at yesterday’s meeting.

Kuznetsov and Sparrows Point Manager David Howard expressed a willingness to work with Maryland officials to seek ways to help the plant. Ruppersberger said tax credits or federal grants for new investment at the mill were possible ways to help the company.

In addition, he said the federal government should look at the high cost of iron ore from countries like Brazil, a cost that critically impacts the balance sheet at Sparrows Point.

Sergei Kuznetsov, CEO Severstal NA

Sergei Kuznetsov, Severstal NA CEO. (Photo credit Severstal)

Ruppersberger said he has tasked Jennifer Riggs, his business and community affairs liaison, to work with other congressional staffers, plus state and local officials, to develop ideas to present to the steel company.

Riggs said she hoped to get a working committee together within the next two weeks. Severstal’s Marika Diamond confirmed that the company would hold follow-up meetings with the government representatives.

Last night, Local 9477 President Cirri issued this statement to The Brew:

“Severstal made no promises today, but I am very proud of the support we have been receiving and will continue to receive from Governor O’Malley, Senators Mikulski and Cardin, Congressmen Ruppersberger and Sarbanes, County Executive Smith, Senator Stone, Delegates Weir, Minnick and Olszewski Jr., and Councilman Olszewski Sr. in their efforts to get our plant back up and running and return our people back to work.

“I need to point out that they have been involved from the beginning and are both committed and dedicated to see this thing through whether with Severstal or a new owner.”

Most Popular