This Morning in Metals: USMCA Labor Council convenes for first time

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This morning in metals news: as laid out in the United States-Mexico-Canada Agreement (USMCA), the USMCA Labor Council convened for the first time; meanwhile, the Energy Information Administration reported on potential electricity disruptions this summer; and, lastly, Rio Tinto declared force majeure at one of its operations.

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USMCA Labor Council convenes

USMCA

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Approval of the United States-Mexico-Canada Agreement (USMCA) included a provision for the formation of a Labor Council.

“The Parties hereby establish a Labor Council composed of senior governmental representatives at the ministerial or other level from trade and labor ministries, as designated by each Party,” the USMCA text states in Article 23.14.

Furthermore, the parties were scheduled to convene the Labor Council no later than one year after the agreement went into force (which it did July 1, 2020).

“Developing a worker-centered trade policy involves giving workers a seat at the table and utilizing all of our tools to ensure that trade agreements are more than just words on paper,” Acting Assistant U.S. Trade Representative Joshua Kagan said in a USTR statement Wednesday. “This first meeting of the USMCA Labor Council, including the public session, demonstrates our collaboration with Mexico and Canada to achieve shared goals and our commitment to holding each other accountable to the agreement.”

In a joint statement, the parties said they discussed “ongoing implementation of Mexico’s recent historic labor law reform.” In addition, the joint statement said the parties covered:

  • The agreement’s requirement that each party prohibit the importation of goods into its territory from other sources produced in whole or in part by forced or compulsory labor
  • Key labor policies for migrant workers
  • Areas for ongoing and future cooperation and technical capacity building

Potential electricity disruption

As temperatures surge around the country — with places like Portland, Oregon, for example, recording all-time temperatures highs — the Energy Information Administration warns that several regions are at risk of electricity disruptions this summer.

“Above-normal summer heat increases electricity demand from temperature-dependent loads, such as air conditioning, and can reduce electricity supplies if power plant outages or reduced output stem from heat-related issues,” the EIA noted. “Wide-area heat waves can challenge grid operators and may limit electricity transfers because the electricity is needed to meet local electricity demand.

“According to NERC’s assessment, electric supply shortages may occur in the western United States, Texas, New England, and parts of the Midwest.”

Rio Tinto declares force majeure at Richards Bay Minerals

Miner Rio Tinto declared force majeure today at its Richards Bay Minerals operation in South Africa.

The miner cited security concerns.

“Rio Tinto has declared force majeure on customer contracts at Richards Bay Minerals (RBM) in South Africa due to an escalation in the security situation at the operations,” the miner said. “This has led to the decision to cease operations until the safety and security position improves.”

The site is South Africa’s largest mineral sands producer. Richards Bay produces predominantly ilmenite, rutile and zircon.

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