Beth Bily filed this story for Business North that details the current state of the mining industry on the Iron Range. This gives a good snapshot of all the mines and companies involved. There are a few other interesting tidbits that haven’t been reported in Minnesota media much. For instance, production and layoffs are running about the same at Michigan’s Empire and Tilden taconite operation. Also, one industry analyst says that taconite production could return to normal by the fourth quarter of 2009. The story is a good read if you’re looking to get a sense of the bigger picture.
A-OK by fourth quarter?
February 26, 2009 by 1 Comment
I hope I’m wrong, but I don’t think there’s any legitimate way that we’ll see an economic turnaround in the next year. In fact, I think it’ll be much longer. While housing prices have dropped a long way, they might still have quite a ways to go. Virtually every major metropolitan area in the country has a huge surplus of homes right now, as the current supply of housing is significantly higher than the demand. I doubt if they’ll be much of any construction of new homes anytime soon. I’ve talked with a few friends who are commercial real estate brokers and that industry is preparing for a major downturn over the next year. In the auto business, virtually all dealers are offering significant deals to get rid of the inventory they have on hand. One dealer in Chicago was even offering a second minivan for $1 if you bought the first one at regular price.
I don’t see any industry that would be major customers of US Steel, Cliffs, or Essar doing very much business for at least a few years. Nothing that’s going to cause any major increase in the price of steel. I hope I’m wrong, but unfortunately I think it’s going to be a really rough ride for a few years. Things could get drastically bad if foreign governments stop buying US gov’t bonds, which will likely happen at some point in our lifetimes if both political parties don’t want to start living within our means.