Cleveland-Cliffs, Inc., has finalized its acquisition of a major scrap producer.

The Cleveland-based iron ore and steelmaker on Wednesday closed a deal to acquire Ferrous Processing and Trading Company (FPT), a leading prime ferrous scrap producer. With the acquisition, Cleveland-Cliffs expects to grow its prime scrap presence through existing relationships with industrial steel customers, according to a Cleveland-Cliffs news release.

“The way the scrap business historically worked has now changed for good,” Lourenco Goncalves, Cleveland-Cliffs chairman, president and chief executive officer said. “With our closing of the FPT acquisition today, we are now immediately focused on amplifying the value of what we believe is the next precious metal. To drive this, we have already begun the dialogue with our steel customers with a focus on increasing our scrap off take from them under a real closed-loop proposition. We are starting from a position of strength with the existing business FPT has in place, and are excited to expand upon this core using the FPT scalable footprint.”

FPT is headquartered in Detroit, Mich., with facilities in Michigan, Ohio, Florida, Tennessee and Ontario. The company currently processes about three million tons of scrap per year. 

Cleveland-Cliffs is the largest manufacturer of iron ore pellets and the largest flat-rolled steel producer in North America. In northeastern Minnesota, it operates Hibbing Taconite Co., Minorca Mine, Northshore Mining Co. and United Taconite.

Iron ore pellets produced at the plants produce steel in blast furnaces.

Scrap is used as a feed in modern electric arc steelmaking. Electric arc steelmaking currently produces about 70% of the steel manufactured in the United States.