Cleveland-Cliffs marks the next step in Northwest Indiana’s steel legacy. Here’s a brief history. (original) (raw)

ArcelorMittal’s recent announcement that it will sell most of its U.S. assets, including the Indiana Harbor and Burns Harbor mills, to Cleveland-Cliffs, marks the beginning of yet another chapter for the Region’s steel industry, which has gone through a number of owners in the past two decades, during which the industry was hit with bankruptcies, layoffs and closures.

For Burns Harbor, Cleveland-Cliffs will be the fifth name change in its 50-plus year history.

The mills that comprise Indiana Harbor East and West have seen several more.

Jaime Quiroz, president of Local 1011 in East Chicago, said he started at the former LTV steel mill 24 years ago and has worked under several different owners in that time.

United Steelworkers union members, retirees and supporters rally for a contract at ArcelorMittal’s North American headquarters in Chicago on Jan. 27, 2016.

“Those who worked in the 1970s could add three or four more names to the list,” he said.

Inland Steel operated the Indiana Harbor plant in East Chicago for almost 100 years when it was purchased in 1998 by Ispat International, a Netherlands company that specialized in acquiring underperforming companies, according to local retirees and company timelines.

Bethlehem Steel built the Burns Harbor mill in the early 1960s and operated it until it filed bankruptcy in 2001.

LTV Steel — Indiana Harbor West — had several owners including Youngstown Sheet & Tube Co. before it filed bankruptcy again in 2001.

In 2002, the newly formed International Steel Group (ISG), headquartered in Ohio, acquired the bankrupt LTV Steel, including the mill at Indiana Harbor West.

In 2003, ISG acquired Bethlehem Steel, including the Burns Harbor mill and U.S. Steel’s Gary plate mill.

One year later, all those mills saw another change in ownership and new names on their buildings. And another name three years after that.

Gases from steel coke processing are burned off at the ArcelorMittal Steel plant in Burns Harbor, Indiana.

In 2004, ISG, Ispat Inland and LNM Holdings merged to form Mittal Steel USA, and in 2007 Mittal Steel merged with Arcelor, creating ArcelorMittal, the world’s largest steel producer.

Two local retirees and former active union leaders — Mike Olszanski from Indiana Harbor and Paul Kaczocha from Burns Harbor — and Northwest Indiana historian Jim Lane reflected on the 100-plus history of the mills in the Region, their high points, union struggles and wins, the various downturns in the industry and the various owners.

Inland Steel

Inland Steel poured the first steel ingots at its massive site on Lake Michigan in East Chicago in 1902, built its first blast furnace in 1907 and in its peak years — 1978-’79 — produced 8.6 millions tons of steel and employed 25,000 people. Almost 19,000 of those employees were members of United Steelworkers Local 1010, said Olszanski, a 33-year employee of the mill from 1966 to 1998 and union activist.

“When I started, there were more than 18,000 members in Local 1010. Now it’s down to 2,000 to 3,000 members and they still make the same amount of steel. Productivity tons per manpower has increased five times since 1980,” he said.

Olszanski said the company was founded in Chicago Heights, Illinois, in 1893 by Joseph Block. In 1901, the Lake Michigan Land Co. gave Inland 50 acres in East Chicago to build the steel mill there.

He said the company’s owners bought used equipment that others were throwing away.

“When I worked in maintenance there, we had to work with obsolete material,” Olszanski said.

He said in the early years the company had its own emergency room that tended to mill casualties and awarded gold watches for safety suggestions. Rather than pay prevailing wages to construction workers building the first blast furnace, the company built them a bunk house and hired a cook so the workers could live there.

The two World Wars kept the mill busy and profitable. In 1941, it processed 3.5 million tons of raw steel a year and employed 14,000 people.

The late 1970s were banner years, with the mill producing 8.6 millions tons and employing 25,000 people.

Historian Lane said the union at Inland was also very active at that time. Lane said Jim Balanoff, who was the USW District director in the 1970s, set up an environmental center.

Olszanski was part of the Balanoff organization at that time, as president of USW Local 1010. He said one of the best things, in his opinion, that the union negotiated in the 1960s and ’70s was an extended vacation plan. Under the plan, members were divided in half into senior and junior categories depending on seniority. Every fifth year, senior members would receive 13 weeks of paid vacation and junior members would receive five weeks.

“The purpose was to get people time off and to save jobs. The mill would have to hire more people,” Olszanski said.

He said as a result of state-of-the art technology and economies of scale, the mills were able to produce more with fewer workers in the 1990s. Local 1010 membership fell to under 9,000.

The mill was sold to Ispat International in 1998, and by 2002 the company had shed almost a fifth of its workforce in East Chicago, to 7,800, Olszanski said.

Burns Harbor

Pennsylvania-based Bethlehem Steel built the Burns Harbor mill in the early 1960s for $400 million, according to an original ad by the steel company. It was the last steel mill of its kind built in the U.S.

But trouble soon started for the company, that was originally founded as the Saucona Iron Co. in 1853, and the industry.

By the 1970s, the company faced growing competition from foreign competition and domestic competition from mini-mills, smaller-scale operations that could sell steel at lower prices.

In 1982, Bethlehem reported a $1.5 billion loss and shut down many of its operations.

The company began discontinuing some of its operations in the early 1990s, and eventually filed for bankruptcy in 2001, dissolving in 2003, and being acquired by ISG the same year.

According to Kaczocha, who worked at the mill from 1970 to 2018 and is a former president of USW Local 6787, there was a big difference at the mill when ISG took over.

“There were fewer managers and more worker control. Someone needed to write a book about what happened when they cut supervision to the bone. It became a workers’ paradise under capitalism,” Kaczocha said.

LTV

The mill was originally known as Steel & Tube Co. of America. It was purchased by Youngstown Sheet & Tube in 1923, then by Jones & Laughlin Steel in the 1970s, and later LTV, which closed the mill in 2001.

While it was once part of a powerhouse company with 4.45billioninsalesin1997,itstartedencounteringdifficultiesinthe1980swiththeinundationofforeignsteelfromJapanandothercountries.LTVfiledforbankruptcyin1986,layingoff90workersatitsHammondplantamongothers.ANewYorkTimesarticlecalleditthelargestbankruptcyfilinginU.S.historyatthetime,withitsdebtat4.45 billion in sales in 1997, it started encountering difficulties in the 1980s with the inundation of foreign steel from Japan and other countries. LTV filed for bankruptcy in 1986, laying off 90 workers at its Hammond plant among others. A New York Times article called it the largest bankruptcy filing in U.S. history at the time, with its debt at 4.45billioninsalesin1997,itstartedencounteringdifficultiesinthe1980swiththeinundationofforeignsteelfromJapanandothercountries.LTVfiledforbankruptcyin1986,layingoff90workersatitsHammondplantamongothers.ANewYorkTimesarticlecalleditthelargestbankruptcyfilinginU.S.historyatthetime,withitsdebtat4 billion.

The company restructured and modernized during the next seven years, during which time it closed or sold more than 30 steel plants and shifted to a concentration on steel for automobiles, appliances, and construction instead of the bar steel and stainless steel sectors. It emerged from bankruptcy in 1993 primarily as a steel producer.

Problems continued, with LTV facing competition from mini-mills and other steel producers.

It filed for bankruptcy again in 2000, closed its Hammond facility in 2001, and was acquired by ISG in 2002.

“What was two separate steel companies became one company to play off one another,” Kaczocha said.

Today, the ArcelorMittal plants in Northwest Indiana employ about 7,800 union members, 3,800 at the Indiana Harbor East and West plants and around 4,000 at Burns Harbor.

Karen Caffarini is a freelance reporter for the Post-Tribune.

Originally Published: October 9, 2020 at 12:11 PM CST