Nfld. & Labrador

Hundreds of workers laid off from mine near Wabush

Three 737 jets have landed at the airport in Wabush to pick up construction workers who have been laid off from the Bloom Lake iron ore mine near Fermont, Que.
Cliffs Natural Resources idles mine expansion at Bloom Lake, reports Jane Adey 2:17

Three 737 jets landed at the airport in Wabush on Monday to pick up construction workers who have been laid off from the Bloom Lake iron ore mine near Fermont, Que. 

Wabush, just across the border from Fermont, has the closest airport to Bloom Lake.

Cliffs Natural Resources, the mine's owner, said earlier Monday it would have to idle its mine expansion in Bloom Lake due to weak iron ore prices.

The company, which is the largest producer of iron ore pellets in the United States, has also shut down production at its mines in Minnesota and Michigan.

Yellow buses have been seen dropping off about 500 construction workers at a private hangar at the Wabush airport, where they are then boarding the jets.

Fluctuating prices

Gerry O'Connell, executive director of Mining Industry NL, said demand for iron ore has slipped, and when demand goes down companies have to adjust quickly. 

"Anybody who has lived in Labrador West for a long time will know that prices do go up and down," said O'Connell. "We do hear rumours of contractions and rumours of expansions and that's just the way it is in the business, I think." 

The price of iron ore has fluctuated significantly in the past couple of years. In 2010, iron ore was worth about $160 US a tonne. In November 2011, the price dropped to $135 per tonne. Then two months ago, the price dipped again to about $99 US a tonne.

O'Connell said the price has since bounced back to $120 US a tonne. 

Operations still normal at Wabush Mines

The layoffs are all the talk of western Labrador, where two iron ore mines operate in Labrador City and Wabush.

However, at Wabush Mines, an iron ore mine also owned by Cliffs Natural Resources, local union president Robert Woodman said the outlook was more optimistic. 

Woodman said operations at Wabush Mines are continuing as normal, with full production. "As long as we can make our production targets we should be okay," said Woodman. "But we do have to bring our cost per tonne down, and that could be an issue in the future."