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New labor contract, investment to benefit Republic Steel plant

A new labor contract at Republic Steel and a new investment at an Ohio plant are good news for Republic's Lackawanna bar mill, a union official said.

"There is nothing but upside for our mill," said Len Sauro, servicing representative for United Steelworkers of America District 4.

The contracts ratified by Steelworkers at several plants run through Aug. 15, 2016 and cover 1,800 workers in the United States and Canada. The total includes 262 workers at the Lackawanna mill and 86 workers at a plant in Hamilton, Ont., said Mark Huemme, a company spokesman. Specific vote results were not available.

The Ohio-based company -- formerly known as Republic Engineered Products -- said the deals include lump-sum cash payments, wage increases and a continuation of fully paid health care coverage.

Along with the contract approval, Republic announced that an $87 million investment in a new electric arc furnace and associated equipment at its steelmaking plant in Lorain, Ohio, will go forward. The company said ratification of the contract was a "necessary element" to start construction of the furnace this spring.

"The additional capacity created by the new furnace will allow us more flexibility and efficiency in delivering the highly engineered products Republic Steel customers require," said Jaime Vigil, Republic's president and chief executive officer, in a statement.

Plans call for construction of the furnace to be finished in mid-2013.

Sauro said the new investment in Lorain will benefit the Route 5 plant by eliminating a "bottleneck" and making available ample product for the Lackawanna plant to use. Republic's Mexico-based parent company has already made investments in the Lackawanna operations.

"This would give them the wherewithal to perform as expected," Sauro said.

The labor contracts cover Republic workers at Republic plants, including Lackawanna; N&T Railway operations; and at Republic Canadian Drawn in Hamilton.