Cleveland Cliffs Inc (CLF)

[abracky]

Cliffs shelves plans to sell merchant pig iron

Published date: 30 June 2021

Cleveland-Cliffs shelved plans to potentially offer merchant pig iron into the US market following its steel mill acquisitions and growth into an integrated steelmaker.
Cleveland-Cliffs chief executive Lourenco Goncalves said today there was no need to diversify the company's customer base by supplying competitors with raw material feedstock--at least for the immediate future. He cited the company's growth into the largest flat-rolled steel producer in the US and a lack of relationships with competing electric arc furnace (EAF) steelmakers.
"I need my (iron ore) pellets to produce inside the company and I need my (hot briquetted iron) HBI to produce inside the company," he said, adding he was "not in the business of producing pig iron" for third parties.
"I have enough pellets to put new (direct reduced iron) DRI facilities to supply the market or do something inside the company," Goncalves said today on a conference call hosted by the Association for Iron and Steel Technology (AIST).
The decision comes after nearly a year of speculation about whether Cleveland-Cliffs would use its new large blast-furnace footprint, which it acquired through purchases of integrated steelmakers AK Steel and ArcelorMittal USA, to produce pig iron for EAF consumption.
When Cleveland-Cliffs first started looking for a blast furnace to buy in order to produce merchant pig iron, Goncalves said he was interested in purchasing the idled Ashland Works blast furnace in Kentucky from AK Steel. It was then that he realized he could buy the entire company.
Last month, Cleveland-Cliffs announced it would tear down the Ashland Works. Then today, Goncalves said the idled No. 3 blast furnace at Indiana Harbor West will likely be torn down as well.
"One of the problems of this industry is these things are like 'Highlander' -- they never die," Goncalves said.
By Rye Druzin

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