Mining has a viable future, Goncalves tells state chamber

Lourenco Goncalves file photo.

MINNEAPOLIS—The automotive industry’s continued use of high-end steel means there will be a viable future for the mining industry on the Iron Range, Lourenco Goncalves, Cleveland-Cliffs chairman, president and chief executive officer, told an audience of nearly 300 at the Minnesota Chamber of Commerce’s annual Economic Summit Thursday at the Minneapolis Renaissance Hotel.

“If mining in Minnesota was not happening, we would not be able to produce cars in the U.S., it’s as simple as that,” Goncalves said, and that includes all of the new electric vehicles launching to market, he added.

In a freewheeling presentation, Goncalves also covered how Cliffs has transformed over the past two years from being a mining company to being a steel company. In March 2020, it acquired AK Steel, and in December 2020 acquired ArcelorMittal USA.  Cleveland-Cliffs is now the largest flat-rolled steel company in North America.

With that optimism, though, he also cautioned that there are challenges to navigate. Case in point is Hibbing Taconite, which employs more than 700 and is one of four active mines Cliffs operates on the Range. The others are United in Eveleth and Forbes, Minorca in Virginia and Northshore Mining near Babbitt.

Currently, Hibbing Tac is running out of crude ore and may well close in the next few years, Goncalves said. But there is hope. Cliffs has expressed interest in acquiring leases and the mineral rights to the former Butler Taconite Plant near Nashwauk, now held by Mesabi Metallics. “We are one (Minnesota) Supreme Court decision away” from taking over Nashwauk, “and then we’ll use Nashwauk to extend Hibbing another 20 or 30 years,” Goncalves said.

As BusinessNorth has previously reported, the leases were terminated by the Minnesota Department of Natural Resources, and an appeal by Mesabi Metallics on the termination is in court.

In addition to Goncalves, the Minnesota Chamber Summit also included a roundtable discussion with two Minnesota Public Radio reporters commenting on the recent election results, and a Q and A discussion with Neel Kashkari, president and CEO of the Federal Reserve Bank of Minneapolis. See the December print issue of BusinessNorth for a full report.