Vanscoy mine shutdown extended five weeks
Fertilizer company cites weak market as 255 workers face longer layoff period
The world’s largest fertilizer company is keeping one of its Saskatchewan potash mines off-line for at least an additional five weeks, which means more than 250 employees will be out of work until at least the end of January.
Nutrien Ltd. announced plans to temporarily shutter its Allan, Lanigan and Vanscoy operations in early September, citing a weaker global fertilizer market resulting in lower demand.
While around 450 workers at the Allan and Lanigan mines are set to return to work on Dec. 29, approximately 255 employees at Vanscoy learned Wednesday morning they won’t be recalled until the end of January at the earliest.
Nutrien spokesman Will Tigley said the decision to keep Vanscoy — which is believed to be among the company’s higher-cost operations — off-line was made due to continued weakness in the global potash market.
“The conditions are still not great, so just to maintain our inventory for that, Vanscoy (will be kept) shut down,” Tigley said.
United Steelworkers staff representative Darrin Kruger called the decision “a disappointment.”
“This is a very, very profitable company and these decisions are coming on the backs of working families so the corporation can maintain billions of dollars in profit for shareholders. It’s workers paying for this,” Kruger said.
Nutrien reported earning, on an adjusted basis, US$1.68 billion in 2018. Its unadjusted revenues totalled US$19.6 billion last year.
While there is no good time to get laid off from work, it is especially hard over the holidays, Kruger said.
“Before Christmas by one week, one week to the day? Merry Christmas from Nutrien,” he said.
Asked when the mine will restart, Tigley said the company will continue to monitor the situation and that it is expected to be down until the end of January.
“We understand how close it is to that (holiday) season, and it is a difficult announcement. The timing of it is just based on the business need and our need to continue to operate safely within our network.”
Nutrien is not the only Saskatchewan potash company to cut production this year in the face of several market challenges, including wet weather in the American Midwest and a suspension of shipments to China.
Mosaic Co. has indefinitely shuttered its Colonsay mine east of Saskatoon and conducted “shortterm” shutdowns at its K1 and K2 potash operations near Esterhazy in southeast Saskatchewan.
K+S has also cut production at its Bethune solution mine, but said no layoffs will result from that choice.
Analysts have attributed the weak market to a range of factors, including delayed contracting with foreign buyers, weather, trade policy, a trade war and the need to make room for new production coming online.