U.S. Rep. Rick Nolan (D-MN8) speaks with Gov. Mark Dayton and Cliffs CEO Lourenco Goncalves before a press conference in Nashwauk Township on July 12, 2016. (Aaron J. Brown)
Last week, Cliffs Natural Resources CEO Lourenco Goncalves announced that his company posted a $199 million profit in 2016. That reflects a positive swing of almost $1 billion from the dismal 2015 downturn of the American steel industry.
It’s also basic math, as Cliffs finally has all its Minnesota mines up and running, filling orders for reopened steel mills across the continent. John Myers has the story, which ran in newspapers across Northern Minnesota.
Goncalves, like other mine bosses, believes that the avowed trade protectionism of the Trump Administration will benefit his company. Sure, it was the combination of increased demand and reduced foreign supply that ultimately put Cliffs back in the black — things that started happening before November. Nevertheless, the Iron Range is experiencing Trump Fever. Opinion leaders, especially those tied to mining, think a golden age lies ahead, or at least would like investors to believe as much.
The improved prospects for Cliffs, however, is only part of the story. The iron and steel business remains a chess game of sorts, and Goncalves used his statement to make some moves.
For one thing, Goncalves said he wasn’t sure where U.S. Steel was selling its pellets from Keewatin Taconite, which is re-opening next month. Maybe that’s so, but a Keewatin Taconite worker I know said they were told they had a contract for pellets through 2021. So U.S. Steel is selling them somewhere. And because they’re selling on the open market, rather than feeding U.S. Steel’s Granite City plant in Illinois, they’re competing with Cliffs.
And then there is Mesabi Metallics, aka Essar, aka the former Butler Taconite near Nashwauk. Two weeks ago, Mesabi Metallics, the successor to Essar Steel Minnesota, announced its plan to emerge from bankruptcy. If they succeed, they’ll finish the $1.9 billion taconite mine on the western Mesabi Iron Range.
Goncalves and Cliffs are on the record opposing the addition of a new player on the Mesabi, again claiming that Cliffs has the customers that once sought ore from Essar and the bankrupt Magnetation. However, last week Cliffs got some high profile help from Gov. Mark Dayton. Dayton issued a statement calling the Mesabi Metallics plan a “moonshot.”
Last summer, Dayton, the Iron Range DFL delegation and Cliffs held a press event near the Essar site. There, Goncalves announced that if Cliffs could get its hands on the former Butler site it would pursue value-added iron ore technologies, like the ones originally proposed by the failed leaders of the former Essar.
And that sound great, except it’s not clear how quickly Cliffs would really want to develop this technology. Most likely, it wants to play out its mining prospects at its other mines first, holding options on the Nashwauk property. What is more important to Cliffs is keeping a competitive new iron ore producer out of the North American marketplace.
What I take away from all this is that yes, the immediate prospects for iron ore look really good. But it’s just as clear that Cliffs, U.S. Steel and others see some limits to their euphoria. Lots of talk, but no one’s laying down big money on the future of the Iron Range mining industry just yet.
Dayton doesn’t look well..
Cliffs robbed hundreds of workers from their retirement. Maybe they can grow some balls and pay that money back with their billions!
THey certainly robbed the employees of Wabush Mines located in Wabush, Labrador, Newfoundland. Left their pension plans underfunded by 48m and then their pensions had to be reduced by either 21 or 25% in order to ensure that all employees did get something. THen they terminated their medical benefits and life insurance. THese people are nothing but leaches who prey on other people. I hope that people who are currently working for them realize they have not ETHICS and as long as they can line their pockets with money from employees hard work they don’t care. DOn’t be loyal to them as they certainly won’t be loyal to you.
This is one of the worst companies anyone could work for,they have no regard for how they treat their employees and even with a signed contract ,they still don’t stand up to their end of the bargain.Maybe if Cliff would pay up their end of the retirement fund,the medical and life insurance for the worker’s of Wabush Mines, who they had a binding contract with ,profits might not be so high.
After working 32 years in a Ming operation, working with the goal of one day in retirement. This company is un humain, low life scum. How can they dare to smile and brag after they left the people who helped make them rich in wabush mines. With nothing. They took the medical benefits from people who are battling life threatening diseases. From survivors of losing their loved ones from diseases related to working in the mines. They took back life insurance and then to take up to 25% of their income. Which every employee had in writing on a leagally binding contact. They can walk away and give their employees NOTHING. They have no moral values and respect for their workers. DONT TRUST THEM. Please God let someone read these words and make this wrong right.
Look at all those smiling faces. Want to know the REAL face of Cleveland Cliff’s? My father worked at Wabush Mines, a Cleveland Cliff’s Natural Resources company, for nearly 30 years, and upon retirement had a decent pension which included a drug plan and enough life insurance to easily cover his funeral upon his death. When Cliff’s spun off Wabush Mines into a separate entity and declared bankruptcy for the mine, he lost 25% of his income, all drug coverage for him and my mother, and the total amount he had in life insurance, even though he had paid for half of that life insurance. So not only did he lose a substantial portion of his income, but he also had to take out another life insurance policy and make monthly payments on it, just to have enough for funeral costs. At the age of 80, this was a huge blow to him and my mother. My dad passed away this past August, and while in the hospital during his illness, he spent most of his time worrying about whether my mother was going to be okay financially once he was gone. This is a worry he should never have had to bear. He did everything right, working hard at his job for years, paying into the retirement fund, paying extra into life insurance, only to have all that security ripped out from under him when he could least afford it. Meanwhile, Cliff’s has continued to make record profits year after year. Declaring bankruptcy on Wabush Mines was nothing but greed on the part of this company. They should be held responsible to fulfill their obligations to the retirees who labored hard for the company and made them successful. If Cleveland Cliff’s for a moment thought that it would be more profitable to close down their Minnesota operations than to keep them open, they’d close them in a second. The fate of the miners put off work wouldn’t be given a second thought. They have absolutely no loyalty towards their workers. Be wary, Minnesotans, because it could easily happen to you.
there should be a class action suite file against Robert Coal,cliffs mining , oreing mining, cemex inc ,they are all related and Umwa any body interest you should reply I been on this over (40)
years. From1950 their is a coal act and any body work around coal since then their disability benefits was proctect Robert Coal is the statury agent also Pickand mather & Company. If you look it up the 1950 coal act
They are in Creditor protection in Canada and making profits in the US. They closed wa ush mines a companies I worked for 31 years. Stole 87000$ from my family in medical benefits and slashed my pension by 21% due to underfunding the pension before going into creditor protection. They have no respect for the people who make their profits and that seems to be the new normal for big corporations, who wants to pretend they have your best intrest at heart. They want your blood sweat and at the end your tears. The one thing they will never get from me is my dignity or which there is short supply in the corporate elite. I blame part of this on our elected officials who’s pockets are being lined, just like the governor of Minnisota, for not enacting legislation to protect workers when corporations skip town with big fat wallets. In closing I would say to the good people and workers of Minnisota. Be prepared for the day when Cliffs fines a better bone to pick where it can make maximum profit. Protect yourself with legislators if it’s not in place, and don’t depend too much on a pension from Cleveland Cliffs to enjoy your ” golden” years or you will find they will not be as golden as you expected. To all you young workers remember, I was you back 30+ years ago, time flies and your day will come. I pray you are well prepared. God bless workers. God damm Corporate pirates.