The 6% pay increase for 72,000 steelworkers in northwestern Germany demanded by the steelworker's union IG Metall was rejected by employers association Arbeitgeberverband Stahl.
AGV Stahl said Wednesday that meeting the demand would be "out of the question."
"The claims volume is adding up to a sum that the steel industry will not be able to cope with in the least," said Bernhard Strippelmann, managing director of AGV Stahl.
On Tuesday evening, ahead of the upcoming collective agreement talks, IG Metall demanded a 6% pay increase for 12 months and Eur1,800 in annual holiday pay with the option to convert those into non-working days.
"It is difficult to comment on the list of demands of IG Metall without polluting the atmosphere of the scheduled agreement talks," said Strippelmann.
IG Metall said that the steel price increases this year justify the demand for the pay rise.
"Capacity utilization was at 90% this year and is coming close to average levels during the pre-crisis period. Even the prices that can be achieved are increasing significantly," said IG Metall NRW head Knut Giesler, adding that HRC prices reached Eur568/mt recently. "That is 80% higher than three years ago," he added.
According to the Platts TSI daily HRC index, prices last reached that level in September on an ex-works Ruhr basis before shedding around Eur25-30/mt over the last two months.
The first round of pay increase discussions will be held on January 10. The obligation of not staging any strikes ends January 31.
