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Cliffs Breaks Ground on Toledo HBI Plant

April 8, 2018

Cleveland Cliffs broke ground on its new $700 million hot-briquetted iron facility in Toledo, Ohio, on Thursday.

“Today we are launching a new era for the iron and steel industry in the United States,” said CEO Lourenco Goncalves. “For several decades, Cleveland-Cliffs has been supplying the American steelmakers in the Great Lakes with customized pellets to feed their blast furnaces. With the growth in participation of EAFs, it was just a matter of time for Cliffs to become a supplier of these important steelmakers.”

Construction of the HBI plant is expected to take two years and, upon completion, the facility will produce 1.6 million metric tons of HBI per year. The plant will be named IronUnits and use taconite pellets from Cliffs’ North Shore Mining facility in Minnesota.

The Toledo facility will be “the most environmentally compliant plant in the world,” said Goncalves. The plant will be fully enclosed and emit no air pollution. Water for the plant will be drawn from the Maumee River, treated on site and recirculated.

The only other HBI plant in the U.S., in Portland, Texas, began operation in 2016 and is owned by the Austrian steel and metals group Voestalpine. The Texas plant has come under criticism from local residents over several pollution issues.

Goncalves said Big River Steel, Steel Dynamics and North Star BlueScope have expressed interest in procuring HBI from the new plant.

“We are taking the initial steps to enable EAF steelmakers to produce the specs associated with high margin steels for sophisticated end markets, such as automotive,” Goncalves said. “In order for EAFs to go to the next step, higher specifications, high-end steels, they need customized feedstock. This will separate the men from the boys and [that’s] good because we don’t have enough for everyone.”

Goncalves hinted that another HBI facility may be in Cliff’s future.

“This is the first plant,” said Goncalves. “I believe there is room for more. It is fair to say this is not the last one, and only Cliffs can produce the HBI because only Cliffs has the pellets.”