A couple of more days of tough economic news for rural areas of the province.
The Iron Ore Company of Canada has announced it is issuing pink slips to at least 150 employees in Labrador City, effective June 14th. The news comes weeks before the provincial budget while iron ore prices are tumbling to below $48 per tonne.
500 people were thrown out of work last year when Cliffs Natural Resources Inc. shuttered its Wabush mine in western Labrador stating that it was no longer economically viable.
Ironically, today media has been reporting the company may sell the operation creating speculation that a potential revival in the local Iron Ore Mining Industry was possible.
Iron ore prices continue to fall due to low spot prices and a wait-and-see attitude in the market. The prices of mainstream imported ore into China fell below 50 U.S. dollars per tonne last week as a result of weak demand. The downward trend of steel prices will continue to weigh on prices of iron ore.
The news comes as a reminder of how dependent this province is on the export of natural resources and how volatility in world demand can have devastating consequences on local industries.