Union accepts proposed labor deal at Alcoa Intalco aluminum smelter

Workers at Alcoa's Intalco Works aluminum smelter voted to accept the company's final contract offer, staving off a second labor dispute at a U.S. smelter this year as prices tumble below production costs.

"The Contract was accepted," The international Association of Machinists & Aerospace Workers said on its website.

Contract negotiations began on Oct. 1 between Alcoa and the International Association of Machinists & Aerospace Workers Local 2379, which represents 500 of the 560 workers at the 230,000 tonne-per-year smelter in Ferndale, Washington.

The vote prevented any industrial action at the plant, as aluminum prices on the London Metal Exchange (LME) languish near 6-year lows and after the Midwest premium AL-PREM paid on top of futures for physical delivery fell an unprecedented 66 percent from its peak in January.

Despite the plunge in prices to levels below many smelters' costs of production, output has risen in China, the world's leading producer and consumer, and the resulting rise in exports has pressured primary producers elsewhere in the world.

The agreement comes just four months after workers at Century Aluminum's Hawesville, Kentucky smelter were locked out for a month after rejecting the company's offer four times.

Though they ultimately approved the deal, Century, controlled by Swiss commodity trade house Glencore PLC, later announced it would reduce output at the plant as a result of weak prices caused by exports from China.

Alcoa presented Local 2379's negotiating committee with its last, best and final offer last Friday. The proposal extends the Oct. 11 agreement through March 31, 2017 and contains no wage increases, as the union had demanded, according to a post on its website.

Alcoa, one of the world's largest aluminum producers, had threatened to close the smelter multiple times in the past due to uncertainty over the availability of affordable power.The vote will bring a welcome sense of stability at a tumultuous time for Alcoa, which plans to split into two separate businesses next year.

Under the new structure, the Intalco smelter would belong to an upstream company that would include Alcoa's primary aluminum, alumina and bauxite businesses, which would be a separate company from the downstream business that makes products like sheet and billet for the automotive and aerospace industries.

Copyright and Exemption Declaration :¢ÙAll articles, pictures and videos that are marked with "China Aluminum Network" on this website are copyright and belong to China Aluminium Network (www.alu.com.cn). When transshipment, any media, website or individual must list the source from "China Aluminium Network (www.alu.com.cn)". We seek legal actions against anyone that disobey this. ¢ÚArticles that marked as copy from others are for transferring more information to readers, do not represent or endorse their opinions or accuracy and reliability. When other media, website or individuals copy from our website, must keep the source. Anyone that changes the articles' sources will hold the responsibilities for copyright and law problems. We also seek legal actions against anyone that disobey this. ¢ÛIf any articles copied by our website concern the copyright and other problems, please contact us within one week.