GCC Dacotah is reducing its work force at the Rapid City cement plant by 21 employees, workers were told Wednesday.

Three of those positions will be cut after those workers retire, and the rest will be lost in a layoff, plant manager Stephen Post said Monday.

The loss brings the work force in the plant's manufacturing sector to 90, down from 111, Post said. The plant now has fewer than half the more than 200 workers who were there when Grupo Cementos de Chihuahua purchased it in 2001 from the state of South Dakota.

The employees who were laid off Wednesday worked in production, maintenance and in the plant's limestone quarry.

The economy, including a slowdown in the construction industry, contributed to the layoffs, but it would be unfair to attribute all the losses to economic conditions, Post said.

"It’s as much a strategic direction the company would like to go," he said, bringing the plant more in line with plants around the country that are similar in the volume of cement they produce.

The decision was not made locally; GCC looked at other plants to establish a benchmark for the core number of people needed to staff the Rapid City plant and to continue to safely manufacture cement, Post said.

The plant also laid off workers in August 2008, shortly after GCC America opened a new, million-ton annual capacity cement plant in Pueblo, Colo.

Around that time, the company shut down the Rapid City plant’s two “wet kilns," an older style of kiln that has a lower production capacity and use more energy than newer types in use in Pueblo, Post said.

Idling those two kilns removed about one-third of the plant's total production capability, Post said. The plant still has one dry-process kiln, a newer style that produces 700,000 tons of cement a year. Post said he did not anticipate the company closing that operating line in the foreseeable future.

GCC America president Enrique Escalante discussed the company's plans in an interview with Cement Americas industry magazine published in January 2009. He said GCC would be looking to reduce production at its less-efficient plants.

“In terms of the old plants and some of the wet-process plants, I expect some of those plants not to restart again,” he said.

Escalante said the company is looking for efficiencies and new markets at a time when the cement industry is in a downturn because of its ties to the construction industry.

“When demand comes down, we look at where we can produce more efficiently or in an optimized way,” Escalante said. “That means bringing inventory down –- shutting down or closing kilns that are not as cost-effective as new plants. We try to bring up production to capacity on the efficient plant.”

In June, the company furloughed employees of its GCC Rio Grande Portland Cement plant in Tijeras, N.M., for a month, in response to a reduced demand for cement, the Mountain View Telegraph (N.M.) newspaper reported.

Plans for the new Pueblo plant were laid at a time when the construction industry in Colorado was booming and there was a shortage of cement needed to make concrete patios, foundations and sidewalks, the Denver Business Journal reported in 2005.

The Rapid City cement plant, built by the state and completed in 1924, was sold under former Gov. Bill Janklow’s administration in 2001 to GCC Dacotah for $252 million.

The plant used to distribute to a wider territory before the Pueblo plant came on line. Today it distributes primarily within a 250-mile radius, by rail and by truck, Post said.

GCC Dacotah recently has joined with other local industrial companies to protest a proposed Black Hills Power electrical rate hike, saying the increase would cost it an additional $1 million a year.

Reach Barbara Soderlin at 394-8417 or at barbara.soderlin@rapidcityjournal.com.