Brazil's Vale to reduce nickel output in Canada
SAO PAULO, Brazil (AP) — Citing falling nickel prices, Brazilian mining giant Vale said Thursday it will reduce production of the metal at its Canadian division and cut jobs in that unit through a voluntary retirement program.
Companhia Vale do Rio, the world's largest iron ore producer, plans to close indefinitely a mine in Canada's Ontario province, shut down operations for July in the province of Newfoundland and Labrador and delay for a year the sinking of a new shaft at the latter site.
Although there will be no layoffs associated with those actions, Vale's Canadian subsidiary, Vale Inco, launched a voluntary retirement program for staff employees who have at least 29 years of service.
There is no specific target number the company has set to achieve for voluntary retirees, Vale Inco spokesman Cory McPhee said.
The announcement comes on the heels of Companhia Vale do Rio's decision in October to implement similar production cutbacks at its Indonesian nickel operation and is the latest development among mining companies affected by the slowing global economy.
On Wednesday, Freeport-McMoRan Copper & Gold Inc. announced similar moves for its copper mines in Arizona and New Mexico. Since the first part of November, the Phoenix-based mining giant has issued layoff notices to about 1,400.
Metals such as copper and nickel are used in a variety of products so when the economy slows, demand and prices fall. Nickel most commonly is mixed with other metals to form an alloy such as stainless steel.
The global mining industry also has logged layoffs such as half the 80-member work force at the Kensington Mine near Juneau, Alaska, and 21 percent of the work force at Montana's Stillwater Mining Co., the only U.S. producer of palladium and platinum.
In a statement, Rio de Janeiro-based Vale said it will close indefinitely the Copper Cliff South Mine, one of six mines the company owns in Greater Sudbury, Ontario.
Vale Inco spokesman Cory McPhee said all of the 365 miners affected by the closure will be given other jobs within the company.
When the Vales Voisey's Bay operations close in July, Vale Inco will ask its 500 employees to schedule vacation during that month.
Workers assigned to the mine shaft development project will be reassigned, McPhee said. The company will review its contractors on an individual basis.
Vale also plans to pursue other initiatives to reduce costs on a global basis.
On Wednesday, Vale said it has cut 1,300 jobs from its work force of 62,000 since the global meltdown began. The cuts amounted to a 2.1 percent reduction at the world's largest iron ore producer.
The company said an additional 5,500 workers are being idled with pay to slow iron ore production, and 1,200 are being retrained for new assignments.
Vale Inco was created in 2006 after Vale bought Inco Ltd.
Vale's shares fell 25 cents, or 2.5 percent, to $9.89 in midday trading.
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