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Cliffs: Testing DRI Pellets in MN

Posted at: 02/13/2013 8:50 AM
Updated at: 02/14/2013 7:48 AM

On a conference call on Wednesday morning, Cliffs Natural Resources CEO Joe Carrabba mentioned that two of their U.S. facilities have been testing DRI grade pellets.

DRI pellets are almost pure iron, compared to the traditional iron ore pellets that are made on the Range now.

More and more companies are seeing DRI as the wave of the future, and are looking at development possibilities, including U.S. Steel and Essar Steel here in the U.S. Now Cliffs is the latest to get involved.

Northshore Mining in Silver Bay and United Taconite in Forbes are the two plants testing the DRI product. The testing happened in the fourth quarter of 2012.

"We're pretty enthusiastic that two of our facilities went through the test runs, trials, and scoping studies. We will continue with engineering studies, so we'll be in place with DRI facilities in the midwest region as alternatives," said Carrabba.

Carrabba also said that their Bloom Lake project up in Canada will become their flagship mine in the future.

As for the iron ore industry now, he expects production in the U.S. to be about 20 million tons for 2013. "We are seeing a recent uptick in the U.S. steel utilization rate, which is currently running at 75%. We expect modest growth for 2013."

Cliffs released their earnings statement for 4Q and 2012 on Tuesday afternoon.