It’s the best of times; it’s the worst of times. And, if you’re reading northern Minnesota news these days, both times seem to be happening at once.
The unemployment rate hovers around historic lows. Gas prices, which spiked to record highs earlier this summer, are coming back down. Some were heartened by a new partnership between prospective mining company PolyMet and a Canadian company, Teck Resources, to explore the northeastern Minnesota’s Duluth complex of copper, nickel and other minerals.
And yet, at the same time, problems abound.
Food and housing remain very expensive due to market inflation and speculation. Local schools still face the same funding crunch they did last year, coupled with declining enrollment at area colleges. Childcare remains inaccessible and unaffordable for many working families.
Then, last week, we learned that Cleveland-Cliffs’ Northshore Mining in Babbitt and Silver Bay will remain idled until at least next April. Almost 500 iron miners have been laid off since May, meaning they will face almost a full year’s layoff by the end of this.
If there is an end.
In June, I wrote about the fact that recycling is now big business for the steel industry. Cliffs CEO Lourenco Goncalves recently stated that the richer iron pellets produced at Northshore were not currently needed because of a massive influx of scrap steel from his recent acquisition of a large salvage company. Adopting industrial scale recycling might then be seen not a luxury, but as an economic imperative for northern Minnesota.
That’s particularly true in the highly speculative world of copper-nickel exploration in this region. It’s true that the minerals found in the ground here might one day be necessary to the U.S. economy. But that truth comes with two important caveats for local communities.
First, while abundant mineral resources rest in the Duluth Complex now mostly controlled by PolyMet and Teck Resources, the costs of mining them remain high. That’s why these projects didn’t happen 50 years ago and, to a large degree, why they haven’t happened yet. Prices of commodities like copper might become tantalizingly high in the future, especially if China falters, but most experts predict highly volatile pricing for the next decade. That’s a tough environment to finance an almost $2 billion mining facility.
And second, the partnership between PolyMet and Teck Resources emphasizes the likelihood that any ores mined will be processed elsewhere, most likely Canada. That puts northern Minnesota squarely in the mining-only link of the supply chain, a fact that comes with significant historical precedent for booms and busts.
I understand that many still see this prospect as being worth the risk. Some do not. Either way, think of how much more economic independence the Iron Range region would enjoy if we expanded our goals. Large scale recycling could occur alongside the mine, perhaps feeding into small mini-mills in places like Duluth or Superior. The electronics of tomorrow might indeed require mined resources, but the real money in electronics comes from invention, design and sales of finished products. Why do we place such low priority on this fact?
One thing in our favor is proximity to natural gas and hydroelectric energy. Metal recycling and modern steelmaking require vast amounts of electricity. In a world that requires less burning of fossil fuels, a clean energy source is an ace in the hole. That’s part of the reason countries like Canada and Sweden are poised for success in this area.
Minnesota might be, too, if our leaders broaden the way they think about traditional industries. Just mining won’t cut it. Strategic mining coupled with value added products and recycling might be the only way this industry holds its current size.
Here we see that economic diversity means lasting strength. Despite political rhetoric, Iron Range leaders have known since the McKinley Administration that, one day, the mines would give out. For some mines in our region that day is nigh.
Are these good times or bad? That will depend heavily on your perspective, your job, and your level of independence from the grinding wheels of market forces. One thing remains certain: we now enter another period of great change in northern Minnesota’s economy. Follow the money. Judge action, not talk. Watch what the world does, because isolation is no longer an option on this spinning planet we call home.
In such times, opportunity comes wrapped in tomorrow’s crisis. Take action on things we can control and argue less about things we don’t.
Aaron J. Brown is an author and college instructor from northern Minnesota’s Iron Range. He writes the blog MinnesotaBrown.com and co-hosts the podcast “Power in the Wilderness” on Northern Community Radio. This piece first appeared in the Sunday, July 31, 2022 edition of the Mesabi Tribune.
We’ll said, as usual. Thank you.
You’ve got my vote.