ArcelorMittal May be Forced to Implement Layoffs and Production Halts at Bosnian Plants

The losses could be cut down if the company halted production or laid off workers, rather than operating at such high prices.

SEATTLE (Scrap Monster): ArcelorMittal and other steel and metal producers in Bosnia have warned that it will be forced to lay off workers and stop production at some plants, on account of surging electricity prices.

According to Nikhil Mehta, General Manager, ArcelorMittal Zenica, the input costs have risen significantly during recent times, mainly on account of massive hike in electricity and coking coal prices. The revised contract with the power utility EPBiH suggests 125% hike in electricity costs, compared with the current contract. Also, the coking coal prices have jumped higher by almost 400%. The severe increase in prices makes it unfeasible for the company to continue normal operations, he added.

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The losses could be cut down if the company halted production or laid off workers, rather than operating at such high prices. It must be noted that ArcelorMittal Zenica directly employs around 2,300 people. Mehta called for immediate government intervention over drastic price hikes. He noted that the electricity prices in neighbouring Serbia have not been increased.

The ArcelorMittal Zenica plant is located in the Zenica-Doboj canton in the centre of Bosnia and Herzegovina. The site consists of facilities including both integrated route and electric arc furnace.