Direct-reduced iron pellets
Cliffs Natural Resources faces several serious problems: huge debt, an anemic iron ore price, tougher global competition. Nevertheless, Cliffs is announcing that it the company is moving on its proposals to convert a production line at Northshore Mining to direct-reduced iron and to add a flux pellet at the soon-to-be-idled United Taconite.
The Mesabi Daily News reports on the news in today’s MINE column by Bill Hanna.
Cliffs management had already announced intentions to do these things, but some of the miners I’ve talked to at Cliffs are skeptical that the company has enough money on hand to put into these expensive projects. Applying for permits is a relatively easy first step, so it’s possible the company is proceeding with hopes that its current fiscal health can be restored in time to invest.
It is absolutely imperative that Iron Range mines figure out how to add value to their products. New steel mills generally don’t use traditional taconite pellets. In a more segmented, niche marketplace, the ability to customize products will be necessary to keep viable Northern Minnesota’s higher-cost operations.
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