Congressman Rick Nolan

Representing the 8th District of Minnesota
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Duluth News Tribune: New pellet, new life for United Taconite By John Myers on May 31, 2017 at 9:24 a.m.

Jun 2, 2017
In The News

FORBES — Jeff Kayfes was sitting in a bucket seat, hands on dual joysticks, trying to line up his unloading machine with a cog on a rail car full of limestone and dolomite.

This limestone unloading job is new for Kayfes who was still getting used to his bird's-eye view from above the rail car and the video-game controls in his hands. But after 41 years as a steelworker at United Taconite, it wasn't anything he couldn't handle.

"It's not that different than unloading ore cars, which is what I did before ... except that I'm sitting up here now and not down at eye level," Kayfes said Tuesday. "It takes a little getting used to."

With the flick of his wrist Kayfes opened up the trapdoor on the bottom of the rail car and 50 tons of the mixed rock — workers here call it fluxstone — tumbled onto a conveyor belt.

Off the rock went to be merged with taconite iron ore and made into a valuable little iron-rich pellet called the Mustang, destined for ArcelorMittal's Furnace No. 7 at Indiana Harbor in East Chicago, Ind., the largest blast furnace steel mill in the U.S.

Kayfes, like the other 474 workers at United Taconite, was part of an on-the-job celebration Tuesday by Cliffs Natural Resources for the new pellet that has breathed new life into a facility that was idle at this time last year, a victim of the downturn in the domestic steel industry and domestic iron ore industry that feeds it.

Now, less than one year after nearly all of them were on indefinite layoff, they are not only back on the job making taconite pellets, they're making an all-new pellet for Cliffs' largest customer, a new product that should add years, if not decades, to United's life.

"It's good to be back. I was off six months," Kayfes said. "We needed this."

By "this" he meant the $75 million Cliffs spent on the project finished earlier this month on-time and under budget. Every day 60 rail cars of the limestone-dolomite mix from Michigan come up the train tracks from the Duluth waterfront. Here at the United processing plant it's mixed with taconite iron ore from the nearby Thunderbird mine in Eveleth.

The button was pushed to start the new pellet production at 3 a.m. on May 12. Starting June 2, the first shipments of the Mustang pellet will be heading south to the steel mill.

"We now have a more marketable product that will carry us forward,'' said Brian Zarn, a United employee and president of Steelworkers Local 6860.

Cliffs' investment was praised at Tuesday's celebration at the plant by U.S. Sen. Amy Klobuchar and U.S. Rep. Rick Nolan as well as other state lawmakers and local dignitaries. In turn, Cliffs' CEO Lourenco Goncalves praised the Minnesota Democrats for their efforts pushing for stiff federal trade penalties against below-cost foreign steel that had flooded the U.S. market, displacing American-made steel and triggering an Iron Range mining recession that saw more than 2,000 workers laid off.

That push-back against foreign steel has led to more demand for U.S. made steel, officials say, and more demand for Minnesota taconite.

"We're back on track and this time we're going to keep it on track,'' Nolan said of the Iron Range mining industry.

Flux pellets aren't new for the Iron Range, and Cliffs made a nearly identical pellet at its now-shuttered Empire Mine in Michigan's Upper Peninsula. But Cliffs ran out of ore there and made the decision to transfer the ArcelorMittal order to United, which can produce about 5 million tons of taconite pellets annually. About 40 percent of the plant's annual production will be the Mustang pellet. When that order is filled by late autumn the plant will produce traditional acid pellets for the rest of winter for other customers.

"It will be a seasonal thing. We'll fill one order, then move to the other pellet, then back," said Ryan Korpela, plant manager.

The flux pellets mix limestone and dolomite with iron at the front end of the process, instead of at the steel mill, Korpela said, saving the steelmaker time, energy and money.

"They like us to have the headaches," he said. "But it ends up working better for everyone, so we're glad to do it."