Vale Reaches Agreement to End Yearlong Strike by Nickel Workers

ONTARIO, July 6 -- Vale SA, seeking to end the longest labor dispute in its 67-year history, reached a "tentative" agreement for a new contract with nickel workers in Canada.

The provisional accord is for a five-year deal, Brazil's Vale said late yesterday in a statement. The United Steelworkers union said in a separate statement it will vote on the settlement on July 7 and 8 in Sudbury, Ontario, and July 8 in Port Colborne, also in Ontario.

"We are very happy to have a deal," Cory McPhee, a spokesman for Rio de Janeiro-based Vale, said in the company statement. "Both sides worked hard to achieve it."

About 3,000 workers represented by the United Steelworkers at Vale nickel operations in Sudbury and Port Colborne have been on strike since July 13, 2009. Vale is the world's fourth- largest nickel producer and its smelter at Sudbury has operated at 50 percent capacity since January.

Vale's Canadian operations produce about 150,000 metric tons of nickel a year, according to Barclays Capital, which estimates global output this year at about 1.4 million tons.

Nickel for delivery in three months dropped $20, or 0.1 percent, to $18,780 a ton by 12:58 p.m. on the London Metal Exchange. The metal, used to make stainless steel resistant to corrosion, has risen 27 percent since the dispute began.

Comprehensive memorandums of agreement will be signed between the company and the union in Sudbury and Port Colborne today, Vale said.