Mesabi Daily News: KEETAC TO REOPEN, BEGIN PRODUCTION IN MARCH
KEEWATIN — Keewatin Taconite will end a near 20-month closure within the next few weeks, resulting in hundreds of employees returning to work.
U.S. Steel announced in a press release Thursday that it will restart Keetac in early January and anticipates production will begin in March. About 202 employees will be initially called back, said U.S. Steel spokesperson Erin DiPietro, in an email.
“I’m very happy,” said Cliff Tobey, president of United Steelworkers 2660, representing Keetac employees. “It’s been very hard on our members. Hopefully they can look forward to a better future, which is just great.”
Keetac reopening is a result of U.S. Steel reaching agreements to supply iron ore pellets to third-party customers, which include supplying U.S. Steel’s former Canadian operations. DiPietro said the company would not discuss details of other commercial relationships in regard to third-party pellet sales.
Keetac has an annual production capacity of approximately 6 million net tons, but the company declined to elaborate Thursday on anticipated production from the restart and agreements.
“U.S. Steel will adjust its iron ore pellet production in order to take full advantage of these business opportunities,” the company stated in a release.
Eighth District U.S. Rep. Rick Nolan, D. Minn., called Keetac’s reopening “wonderful news” and a product of the groups that championed the steel industry
He cited a visit from White House Chief of Staff Denis McDonough last year, which prompted taxes, tariffs and other countervailing duties on subsidized steel as a driver behind the improved market. The tariffs are in place for at least the next five years, providing some stability for steelmakers.
Keetac pellets used to be sold exclusively to U.S. Steel’s mill in Granite City, Ill., but the new contracts are an example of that stability and a broadening steel market compared to the past year.
“It’s indicative of a stronger market that they found other options for selling their pellets,” Nolan said in a phone interview with the Mesabi Daily News.
Tobey expressed confidence the plant would remain open on long-term basis, referencing the amount of maintenance work needed. The initial callback numbers reflect what’s needed to bring the plant into operation, and State Rep. Jason Metsa, DFL-Virginia, said he hopes for good news in March when the company assesses its employment when production restarts.
More than 400 workers were at the plant before it idled. Tobey was unclear how many would return, and how many moved onto to new places and jobs as a result of the long idle.
U.S. Steel CEO Mario Longhi said earlier this month that the election of President-elect Donald Trump infused new confidence in the industry. He said that 10,000 employees industry-wide could be hired back if the market continued to improve.
At the time, the company declined to say how many workers it could bring back, and said Keetac’s return was dependent on the market conditions.
“It’s not a small undertaking to start a pellet plant,” Tobey said in a phone interview with the MDN. “It’s going to cost some money. I’m sure U.S. Steel wouldn’t have gotten into a third-party sale if they were confident they could succeed.”
Keetac idled in May 2015 as part of a devastating downturn in the industry caused by a global glut in the steel market. Subsidized steel illegally dumped by foreign countries flooded the market, prompting prices to bottom out and several plants across the Iron Range to idle.
Metsa and State Sen. David Tomassoni, DFL-Chisholm, said recently-passed legislation concerning sulfate standards and approved EITE power rate cuts through Minnesota Power were factors in the reopening.
Tomassoni said local officials and the Iron Range Resources and Rehabilitation Board have been working to make sure taconite plants re-open and good-paying jobs are still available to the area’s work force.
“I believe all of these actions together have had a positive effect with real-world impacts. People getting their jobs back is a big deal,” he said in a statement. “We must continue to remain vigilant and support our industries and the accompanying jobs through bi-partisan actions because jobs should not be political.”
Reaction across Minnesota’s elected officials was swift and positive to the news.
U.S. Sen. Amy Klobuchar, D-Minn., said the “collective voice of American workers” to combat illegal steel dumping has been heard.
“As we head into the new year, this announcement generates both a renewed confidence for the U.S. steel industry to bring back more jobs and a renewed commitment for those of us who continue to fight for a level playing field for American workers,” she said. “ … We cannot rest until every worker is back on the job.”
Gov. Mark Dayton said, “This is great news for Keetac’s workers, for the Range, and for all of Minnesota.”
Newly-elected State Rep. Sandy Layman, R-Grand Rapids, said she was looking forward to working with U.S. Steel and other producers to create a positive business climate.
“This is very welcome news, particularly for those many folks on the western Iron Range who have been waiting to return to work,” she said. “I think we should look forward to better times ahead.”
Iron Mining Association of Minnesota President Kelsey Johnson said the restart shows a strengthening iron and steel market, and is in part thanks to instrumental support of statewide partners.
“We are grateful to those who have supported Minnesota’s iron mining industry over the past years,” Johnson said, in a release. “Legislative and community support through environmental, energy and other important issues are a key piece of getting this important industry back on its feet.”
U.S. Sen. Al Franken, D-Minn., said he was happy for the Range families gaining more security.
“U.S. Steel’s decision to reopen the Keetac mine in Keewatin is great news for hundreds of our Iron Range miners, who have been out of work for too long thanks to an influx of illegally priced Chinese steel flooding our markets,” Franken said. “Today’s announcement is yet another positive sign that the Iron Range economy is starting to recover.
Nolan added that Keetac may be just the start.
“It’s good news,” he said. “Good news that portends to even better news for the Iron Range.”