London — ArcelorMittal Italia has declared force majeure following a crane accident Wednesday at its Taranto works, the company announced in a letter seen by S&P Global Platts Friday.
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The declaration follows the authorities' seizure of the pier No. 4 at the Taranto works for investigation, ArcelorMittal said in the letter dated Thursday.
As a result of the seizure, ArcelorMittal Italia "is unable to fully operate in the affected areas for the foreseeable future and therefore by this letter we inform you that our ability to perform our obligations under our contracts will likely be prevented, delayed, hindered or otherwise adversely affected," the company said in the letter.
The company added it was unable to say for how long the force majeure would continue.
The Taranto works, formerly operated by Ilva and acquired by ArcelorMittal last year, is Italy's largest flat products works. It was expected to produce around 5 million mt of flat products in 2019, up from 4.5 million mt last year, and will be targeting its full capacity of 9.5 million-10 million mt a year in four to five years' time, according to sources close to the company.
The accident Wednesday, when a crane being operated by a worker at the works' raw materials pier fell into the sea, was caused by weather conditions, ArcelorMittal Italia said. The company had confirmed Thursday that the worker was still missing, following which union sources said they had started an indefinite strike and were taking action to bank the Taranto works' blast furnaces Nos. 2 and 4.
Union sources including those from Fiom-Cgil, the main metalworkers' union at the Taranto works, said the two blast furnaces had been put on standby mode, being kept warm but not producing hot metal. Each furnace recently had been operating with a target production capacity of 1.5 million mt/year. The cold-rolling portion of the mill was also been put on stand-by, sources told S&P Global Platts.
According to a union source, only blast furnace No. 1 was working without any problem at the Taranto works as of Thursday. It has been working with a crude steel production target of 1.2 million mt/year.
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