Temporary Shutdown and Furloughs
Liberty Steel USA, part of the financially strained GFG Alliance, has temporarily shut down its Peoria Wire Mill in Bartonville, Illinois, impacting around 500 workers. This decision, effective from December 6, is driven by ongoing challenges in the steel market, including an influx of low-priced steel imports. The furloughs will affect employees in both the melt shop and wire drawing/finishing departments. Around 260 employees in the melt shop and 280 in the wire operations will be temporarily laid off. Despite the idling, a portion of the workforce will remain to fulfill existing customer orders.
GFG Alliance’s Financial Struggles and Impact on U.S. Operations
The shutdown reflects the broader financial difficulties faced by GFG Alliance, which has struggled since the collapse of its key financial partner, Greensill Capital, in 2021. The company has experienced continuous setbacks, including creditor demands, legal challenges, and operational closures. This Peoria shutdown adds to a growing list of reduced or idled operations across the U.S., U.K., and Europe. A similar situation has unfolded in Georgetown, South Carolina, where Liberty Steel previously reduced its workforce to just six employees and sold off equipment due to market pressures.
Peoria Mill’s Legacy and Challenges
The Peoria Wire Mill, once part of the Keystone Steel & Wire operations, has a long history in the steel industry. It traces its roots back to the 19th century and specializes in recycled steel production using electric arc furnaces (EAF). Acquired by Liberty Steel in 2018, the mill boasted a production capacity of 700,000 tons per year at its peak, with the latest technology in EAF equipment installed during the 1980s and 1990s. Despite its legacy, the mill has faced difficulties in maintaining competitive production due to market fluctuations and challenges within the broader steel industry.
Plans for Restart and Future Outlook
Liberty Steel has indicated that the Peoria Wire Mill will resume operations when market conditions improve, with a tentative restart scheduled for early February 2025. The company remains hopeful that the market will stabilize, allowing for the full restoration of production. However, ongoing challenges in the steel sector, such as competition from cheap imports and financial instability within GFG Alliance, continue to present significant hurdles.
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