Blair Miller
Daily Montanan
The Sibanye-Stillwater mining company announced Thursday it plans to lay off around 700 employees in Montana as part of a restructuring due in part to a dive in palladium prices and the loss of more than $350 million in Montana since the start of 2023.
The layoff announcement comes less than a year after the company announced it was laying off around 100 employees in Montana. The company owns the Stillwater and East Boulder operations, which are southwest of Columbus, as well as the Columbus Metallurgical Complex.
The company is the largest employer in Stillwater County and employs people from across south-central and southeastern Montana, said Sen. Forrest Mandeville, R-Columbus. The layoff announcement led to both of Montana’s U.S. senators introducing a bill within hours seeking to ban the import of Russian palladium that the company says has caused massive losses.
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In a letter sent to employees Tuesday following a corporate results call for the first half of the year, in which the company’s CEO announced Sibanye-Stillwater was cutting about 800 jobs as part of the restructuring. Kevin Robertson, the company’s U.S. platinum group metals operations executive vice president, said the layoffs will start Nov. 12, but salaried employees who will lose their jobs will be notified by email on Thursday and hourly employees will be contacted by their union.
A spokesperson for the company said he did not have exact figures, but the average annual salary was around $110,000 and a “significant” benefits package.
“We estimate that this restructure will reduce our total number of employees at our Montana operations from approximately 1,680 on July 31 to just under 1,000 after layoffs,” Robertson said in the letter. “We know this will be a very difficult time for everyone and want to ensure employees receive the support they need.”
The Montana operations produce about 78% palladium and 22% platinum, according to the company. But it says palladium prices have fallen from $2,305 per ounce two years ago, to $1,280 per ounce last summer, and now to below $1,000 per ounce. Palladium futures opened the day trading at $1,015 per ounce and had jumped to $1,057 per ounce as of 2 p.m. on Sept. 12.
The company says it believes Russia is inundating the palladium market to tank its prices, and prices for imported palladium in the U.S. have dropped by almost 40% this year.
The company said it had increased production by 8% the first half of this year compared to the latter half of last year, but costs have outpaced sale prices, resulting in the Montana operations losing $265 million last year and $87 million in the first half of 2024.
“This responsible and sustainable mining and metals processing is much, much more expensive than that of our competitors in Russia and other areas,” Robertson said in the letter. “To compete with those low-cost operations, we need to solidify government and other stakeholder support in the long-term. In the short-term, we have no choice but to reduce our losses as we continue to lobby for additional forms of financial support.”
Sibanye-Stillwater’s East Boulder Mine. The company says it plans to continue production at East Boulder and Stillwater East while pausing operations at its Stillwater West Mine.
Northern Plains Resource Council
The western section of the Stillwater mine started producing in 1986 and the eastern section is in a buildup phase. The East Boulder mine has been in production since 2002.
Robertson’s letter said the company planned to pause operations at Stillwater West and continue production at Stillwater East and East Boulder, with the hopes of resuming operations at Stillwater West “as prices permit.” It also plans to use four ramps instead of six at East Boulder and to reduce operations at the Metallurgical Complex while recycling continues.
Sibanye-Stillwater’s Stillwater Mine. The company says it will pause operations at its Stillwater West Mine as part of its restricting in the face of low palladium prices.
AP Photo/Matthew Brown, File
The company said each site and department is finalizing restructuring plans up through Nov. 12, when the initial layoffs will occur. Employees could be eligible for severance and will be eligible for benefits through November, Robertson’s letter said.
The letter also said it plans to ask other local employers who are hiring to “help place as many laid-off employees as possible into other jobs.”
The letter says the company hopes to bring Stillwater West back online as soon as possible, that it is committed to the local community, and that it is optimistic the market will recover and government will support the mineral mining efforts.
A map of the locations of Sibanye-Stillwater’s Stillwater and East Boulder mines.
Courtesy of U.S. Forest Service
“The decision to pause operations at Stillwater West and to curtail production at East Boulder was one we put considerable thought, time, and effort into and delayed as long as we could,” Robertson wrote in the letter. “But to continue to operate at these losses would jeopardize our ability to operate at all. We are therefore now undertaking this significant restructuring that we believe will ultimately result in a sustainable business.”
The letter said the company planned to meet with United Steelworkers leadership “with the hope of working together to ensure the long-term sustainability of our operations and our employment opportunities.”
United Steelworkers is under the umbrella of the AFL-CIO in Montana. AFL-CIO executive secretary Jason Small said the “vast majority” of employees at the company’s Montana sites are union workers, but he was unsure Thursday afternoon exactly how many union members would lose their jobs.
Small said he suspects some of the laid off employees will try to find similar underground mining work in other states like Nevada, New Mexico and Arizona because it would be difficult to immediately find jobs in south-central Montana. But he said he believes some will stay in state.
“There’s a possibility that some people can become boilermakers, some can become laborers, pipe-fitters, ironworkers,” he said. “You know, there’s some opportunity there if they’re trying to stay in state.”
He said he had already spoken with the Department of Labor and Industry, which will be putting out active response teams to help coordinate job help and training for the affected workers.
“We’re more than willing to step in and do that again. They’ll have a team set up and ready to roll to help get these guys going,” Small said. “…We’re in support of the workers, and we’re going to do everything we can in conjunction with whatever partners we need, whether it be DLI or any others, to help get these guys transitioned and keep them moving and prosperous.”
Montana officials call layoffs ‘unacceptable,’ ‘significant blow’
Montana Gov. Greg Gianforte called the layoffs “a significant blow” to the workers and community and said the state would bring “every available resource” forward to help the affected families.
“This is a challenging time for the mining sector. The ongoing regulatory assault on mining and natural resources has burdened this critical sector of our economy,” Gianforte said in a statement. “The fact is the United States cannot and should not have to rely on our foreign adversaries for energy, critical metals, or other resources. The United States must support these industries, and their workers, with a policy dedicated to making our nation energy and resource dominant and independent.”
U.S. Sens. Jon Tester (D) and Steve Daines (R) separately introduced similar bills Thursday in response to the layoff announcement that seek to prohibit the importation of critical minerals from Russia.
Tester’s office said he spoke with Deputy Treasury Secretary Wally Adeyamo after the announcement pushing the administration to help the laid off workers. He called it “unacceptable” that Montanans were losing their jobs because of Russian critical mineral imports.
“When I heard that Sibanye-Stillwater was laying off hundreds of hardworking Montana miners because of this Russian activity, I reached out to local officials and the workforce to team up and immediately introduce our bill to ban the importation of Russian palladium,” Tester said in a statement. “This has gone on for far too long, and I will continue to stand with the Montanans who are being targeted by this unfair trade practice.”
Daines blamed the Biden-Harris administration for “allowing” the imports to occur.
“There is no reason the United States should be importing critical minerals that we can find right here at home,” he said. “Montana is rich in minerals, and we need to be supporting American mines and American jobs, not Russia’s.”
Mandeville, who is in Helena attending interim committee hearings this week, told the Daily Montanan he contacted county commissioners and Department of Labor and Industry Commissioner Sarah Swanson shortly after learning about the layoffs Thursday to check what resources the state can bring to help affected workers and families in the region.
“It’s certainly a big deal to the area. I mean, the 700-800 families that are going to be affected by this are absolutely the first priority. And thinking about how they’re going to be able to deal with this fallout and the impacts just on the community that we’re going to see – these are good people that are involved in a lot of stuff,” he said. “There’s going to be an impact on schools, on nonprofits, on churches – everything that these individuals are involved in is definitely going to feel this.”
He said he worries how several hundred people losing their jobs might affect the community even if they can be placed into other jobs and that he had put Swanson in touch with Stillwater County officials and its economic development coordinator to “make sure we’re all playing on the same team.”
“It’s really going to be specific, family-to-family, individual-to-individual, on what help is needed,” Mandeville said. “I’m confident that Commissioner Swanson is going to do what she can in her powers to make sure there’s resources available. And like I told her, I’ll do what I can on my end to make sure people are familiar with those resources that come.”
This story was originally published by the Daily Montanan.
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Publish date : 2024-09-13 01:15:00
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