Vale to resume operations after workers accept new contract

Vale to resume operations after workers accept new contract

STUBE SA, world's largest commercial producer of nickel, will start resuming operations in Vale SA after workers accept a proposal to end two-month strike.

About 85% of members of the USW Local 6500 voted in favor of Vale's new contract offer, the union said. The two sides resumed discussions on 19 July after two previous proposals were rejected.

Sudbury staff will return to work next week, allowing production at the nickel-copper complex to ramp back up in the weeks ahead. 'Vale reaffirms its commitment to the long-term sustainability of its base metals business and its Toronto operation, announced the Rio de Janeiro-based company in a statement Wednesday.

The resolution will come as relief to metals markets. Sudbury is one of the few producers of nickel pellet, which is used to make alloys for the aerospace, electronic and nuclear industries. The disruption drove consumers to tap battery-grade nickel briquette as an alternative, raising its premium and shortening inventories. At 2: 07 p.m. in London, Nickel futures were down 0.1%.

Restarting Sudbury will also help Vale keep its base metals ship after a poor performance in the last quarter that prompted the company to discontinue annual production guidance. In a call with analysts last week, Chief Executive Officer Luciano Siani predicted a 'challenging' third quarter at Sudbury even if the strike ended quickly.

Besides monetary sweeteners, the new contract preserves retiree health benefits for future hires as well as giving each worker a $3,500 signing bonus and $2,500 for their efforts in the Pandemic.

Post-retirement benefits had been a sticking point in the talks as Vale looks to contain costs and overhaul operations with an eye on the demanding battery market.

'We have many opportunities ahead of us with the growing electric vehicle market, said Dino Otranto, chief operating officer of North Atlantic operations, in a statement. 'The nickel, copper and cobalt we produce are low carbon metals to achieve a critical future.