2018-03-09reuters.com

Lang is one of around 780 workers at the Novolipetsk Steel PAO (NLMK) mill, NLMK's U.S. subsidiary which imports around 2 million tons of steel slabs annually from its Russian parent company. The slabs that the mill rolls into sheets for customers including Caterpillar Inc (CAT.N), Deere & Co (DE.N) Harley Davidson Inc (HOG.N) and Home Depot Inc (HD.N), are almost impossible to acquire from U.S. steel producers.

Bob Miller, Chief Executive Officer of NLMK's U.S. unit, said if his company's customers refuse to accept a 25 percent price hike as a result of the tariffs, nearly 1,200 workers could eventually lose their jobs - and the ones in Farrell would be the first to go when supplies of imported slabs run out.

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Miller said tariffs will also force NLMK to shelve planned $600 million investments in plants in Pennsylvania and Indiana, around $400 million of which was earmarked for upgrading antiquated equipment at its Farrell plant.

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Some steel executives such as Miller say this is the ultimate irony: by acting ostensibly to protect U.S. steel jobs with sweeping tariffs, Trump will also kill off some steel jobs.

"The workers here in Farrell are on the front line," Miller said. "This policy is picking winners and losers and unfortunately, we are the losers."

The tariffs are good for steel producers that melt and produce their own steel. But for those like NLMK, which is reliant on imported raw materials, they could prove catastrophic.

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Its blast furnace was sold for scrap and instead of producing steel, its current crop of workers heat 25-ton imported steel slabs to a glowing-orange temperature of 2,400 degrees fahrenheit (1,316 Celsius) before rolling them down in some cases to as thick as a few sheets of paper.

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Miller is working to lobby the Trump administration to follow the precedent of former Republican President George W. Bush's administration, which allowed quotas for slab steel in 2002 rather than applying tariffs as it did for products that were domestically produced.

Those quotas allowed the Farrell plant to keep operating and Miller hopes the Trump administration will follow suit.

The mood in Farrell is grim and fearful. Truckers coming to pick up coils of rolled steel ask when the mill will go out of business and plant manager Bill Benson says workers keep asking him: "What on earth is Trump thinking?"



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