Israel ammonia saga seems near end as 800 workers to be fired
In stinging message to Netanyahu, owner of Haifa Chemicals says all suggestions for resolution fell on deaf ears
Shoshanna Solomon was The Times of Israel's Startups and Business reporter
In a strongly worded letter to Prime Minister Benjamin Netanyahu, the owner of Haifa Chemicals said Wednesday he has decided to shut down the operations of the fertilizer maker and let go its 800 workers after a compromise for the continued operations of the firm was not reached.
Israel’s Histadrut labor union and the workers at the plant said they were trying to halt the layoffs.
Haifa Chemicals has been operating for over 50 years and consumes some 68 percent of Israel’s imported ammonia to produce specialty fertilizers at plants it runs in the north and the south of the country. The plants employ some 800 workers directly and some 4,500 indirectly, and are responsible for 2 percent of Israel’s industrial exports, according to data provided by the company.
“With great sorrow, and after many efforts, we have reached a point in which we can no longer contain the activities of the company in Israel,” wrote Jules Trump, a 73-year-old South African-born US citizen and real estate tycoon who holds a controlling stake in the Israeli fertilizer maker. “I understand that we will not get the permit to return to our activities in the near future and so we don’t have a choice but to shut down the firm immediately.”
The controversial Haifa Chemicals ammonia tank in the Haifa Bay was ordered to be shut down in 2013, in a struggle that pitted local residents concerned over the potential for a deadly chemical leak against those who say its closure would adversely affect the economy.
In May, the Supreme Court ruled that the facility must be shut down by the end of the July, saying that even though the probability of a leak is small, the damage such a leak could cause would be intolerable.
In the ruling, the judges said that “the tank has no building permit and Haifa Chemicals is operating without a business license.”
The announced closure of the firm operations comes as Israel’s watchdog says government officials handling the search for an alternative to the plant in Haifa may have illegally helped the company that owns the plant and that some of the misconduct may have been criminal.
The “tragic result” of the closure of the company, wrote Trump in his letter to Netanyahu, stems from the fact that for the past five months production has been halted, causing a loss of hundreds of millions of shekels as the workers were kept on in the hope and on the promise that the government would find a “reasonable” solution that would enable the company to continue its operations, he wrote.
“Now we learn that in spite of the unanimous government decision to find a solution for the ammonia crisis… the implementation of a solution is not on the horizon,” Trump wrote. “We are forced to close the company and fire its workers.”
Knesset member Dov Khenin, the chair of the Social-Environmental Knesset lobby, said that the management of Haifa Chemicals was making “cynical and scandalous use of its employees.” The company has known for four years that an alternative must be found for the supply of ammonia, but it chose to “make its employees hostages in a battle that will allow them to continue to pollute and endanger public health.”
Khenin called on the government not to succumb to “this blackmail” and not to favor “the huge profits of foreign tycoons” as it “has done so far.”
“I appealed to the chairman of the Finance Committee yesterday to request that he convene the committee urgently to discuss the crisis and prevent the dismissal and the cynical use of the workers,” he said in a statement.
In 2013, the government decided to shut down the ammonia tank in Haifa Bay by 2017 and to set up a new production plant in the Negev instead, out of concerns for the safety of the citizens of Haifa. The government also committed to ensuring a continuous supply of the compound until the new production plant was up and running.
Local officials, led by Haifa Mayor Yona Yahav, say that tens of thousands of people could die if the 12,000-ton-capacity tank should rupture, and that even more would be at risk if a monthly delivery ship that brings ammonia to the massive tank from abroad is hit by a missile. The Lebanese terror group Hezbollah has threatened to target the tank with rockets in any future conflict with Israel.
Following the publication of a report commissioned by the city of Haifa that found the ammonia operations posed a serious risk to the population, a court ordered the closure of the Haifa Bay tank where the ammonia is stored after arriving by ship.
In an interview with The Times of Israel in March, Trump said the report on the dangers of ammonia was greatly inflated.
The ammonia storage facility in Haifa was slated to be emptied by April, but the government asked that the court give an extension in order to allow time for fertilizer companies that rely on the ammonia to prepare for its closure and prevent “a possible shutdown of the fertilizer industry in Israel.”
The government requested that the court consider keeping the massive tank operating for another two years until an alternative is found.
A tender to set up a new plant in the Negev that would manufacture ammonia, which would eliminate the need to import and store it, failed in 2016 due to a lack of bidders, delaying the opening of any new facility indefinitely.
Avi Gabbay, the chairman of the Labor Party, said the blame for the closure of Haifa Chemicals lay in the government’s “scandalous” gas policy, which set high natural gas prices in Israel. If it were not for the exorbitant natural gas price set by Netanyahu, there would be a factory to create ammonia and more employment instead of the painful closure of Haifa Chemicals, he said in a statement.
The chairman of the Histadrut Labor Union, Avi Nissenkorn, said that on August 8 all factories in the south of the country with Histadrut employees would shut down for the day if no solution is found for Haifa Chemicals, and there would be further solidarity strikes around the country.
“Stop with all this talking and foot-dragging,” he said in a statement. “I expect the parties, including government officials and owners of the company, to find an immediate solution.”
Eli Lutaty, a union member and Haifa Chemicals employee who has been at the firm since 1983 and is in charge of maintenance, said that the parties must reach an agreement.
The announcement of the layoffs is a management ploy to pressure the government, he said. “They are using us as hostages,” he said.
An alternative solution can and must be found, he added, even if that means the owners will make a little bit less than the “millions” they have been making from their operations at the company. He said the workers were planning to set up a meeting next week with the mayor of Haifa and with management to try and reach a solution.
In his letter to Netanyahu, Trump said that the company made 12 suggestions for the alternative supply of ammonia, including the setting up of the plant in the south of the country, but none of the suggestions was accepted. The company is in the process of emptying out the tank in Haifa and 98% of the fluid has already been emptied.
“All we asked for was a solution to enable us to immediately get back to work. But nothing helped,” Trump said.
“On a personal note, this decision breaks my heart, as I have got to personally know the people and their stories,” Trump wrote. “I know that those who pushed us toward this decision in such an unjust way will continue their lives undisturbed, while the hundreds of workers who will be fired will experience a lifechanging event with drastic consequences that we cannot halt.”
Haifa Chemicals is owned by US holding company Trance Resource Inc (TRI), which is controlled by Florida-based Trump Group, according to Reuters.
