1:16 p.m. Severstal to lay off 1,900

STEUBENVILLE - Severstal International will lay off 1,900 workers at Severstal Wheeling plants as a result of the expansion of idling of facilities across the company while demand remains slack.

The company issued a statement from its North American headquarters in Dearborn, Mich., Thursday afternoon that the hot rolling and steelmaking operations at Mingo Junction will remain idled. The last steel processed by the hot strip mill was at the end of April. The steelmaking and ironmaking furnaces have been idled for months.

With the company's announcement, all but the coke plant at Follansbee will be shut down in the Severstal Wheeling operations. Company spokeswoman Bette Kovach said the coke plant will continue to operate at a reduced level, as it has been in recent weeks.

She said the coke plant's output primarily will be going to the Severstal North America plant in Dearborn, the former Ford Rouge Steel plant.

The company issued Worker Adjustment and Retraining Notification Act notices for its Wheeling facilities today, according to the statement.

Kovach said while Severstal considers the idling of the plants temporary, it is not able to say when economic conditions will support their reopening, thus prompting the W.A.R.N. notifications.

She said the idling of the cold mills in addition to the steelmaking and ironmaking furnaces, as well as the slab caster and hot strip mill puts about 1,900 employees on layoff.

About 88 employees at the former Wheeling-Pittsburgh Steel headquarters in downtown Wheeling were laid off, with one source saying the workers were terminated at the end of April. Kovach said she couldn't confirm the statement.

"We are laying people off, with some still at work at the facilities as they wind down, then they will be laid off. Some will be temporary, and some will be permanent. I can't break down how many of each there will be, but it will be primarily temporary," Kovach said. "We expect that the facilities will produce again at some point in time, but it is not known when, based on the severity of the economic crisis."

Gregory Mason, chief executive officer for Severstal International said, "These are difficult decisions that have not been taken lightly and without careful consideration. Unfortunately, due to the continued deterioration of market conditions across the entire steel industry, they are necessary to ensure the long-term sustainability of our U.S. business."

Severstal paid $1.25 billion for Esmark, which was the parent of Wheeling-Pitt, last August, buying the local mills as well as Esmark's steel service centers across the Midwest. The company went ahead with an already planned shutdown of the blast furnace and basic oxygen furnace at Mingo Junction for refurbishing in August. The furnaces were not restarted when the economy began its nosedive in September.

Severstal had been on a North American buying spree last summer, buying not only Esmark but also WCI Steel in Warren and the Sparrows Point, Md., plant from ArcelorMittal, the former flagship plant of Bethlehem Steel for much of the 20th century. OAO Severstal acquired the former Rouge plant at Dearborn in 2004.

The company has been idling facilities at Sparrows Point, and is to idle in June that plant's blast furnace, which had been restarted after a refurbishing in recent months.

In its announcement Thursday, Severstal International said it is indefinitely idling all production and finishing operations at WCI Steel, with 1,200 either now or about to be placed on layoff. Severstal Warren's galvanizing line was idled at the end of February.

"I want to restate our commitment to our employees, their families and the communities in which we operate. We still strongly believe in the viability of our U.S. facilities and the long-term fundamentals of the U.S. steel industry. We are making our best effort as a company to manage prudently through this downturn so that we are well positioned to maximize success when conditions improve," Mason said.

(Giannamore can be contacted at pgiannamore@heraldstaronline.com.)