Cliffs' CEO Sees Positive Things Ahead for Industry, Company

July 27, 2017 07:27 PM

His quote was, "The U.S. iron ore market is a beast."

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Lourenco Goncalves told investors on Thursday morning that second quarter was remarkable, and that they were able to see the true earnings power of the iron ore business.

The chief financial officer said that their sales volume was stronger than they anticipated, as their customers had an increased appetite for pellets.

Goncalves then highlighted the start of Project Mustang at United Taconite. That's the $75 million dollar venture that enabled the plant to make a custom pellet for ArcelorMittal.

And he focused on the announcement about their DRI facility in Toledo.

"We've seen a lot of excitement from financial partners, as well as partners we already have, like the state of Ohio," he said.

The DRI facility will use pellets made from Northshore Mining, to create HBI, hot briquetted iron.

They hope to be operating in 2020. He had been eyeing the former Essar site, but that is now under the control of Virginia businessman Tom Clarke.

As for others who are trying to revive the former Essar site and Magnetation assets, he said, "Magnetation failed. Essar failed. Newcomers would like to be Cliffs. But they are not Cliffs, and will never be. For us, they're not even a distraction."

Goncalves added that although a decision from the Trump administration has been delayed about steel tariffs, he believes it will be a positive thing for the steel industry.


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