Essar arm to invest $18-bn in US steel

Washington: India’s Essar Group, through its US subsidiary Mesabi Metallics, will invest about USD 18 billion to build a fully integrated steel business in the United States, including a USD 15 billion steel complex in Iowa and about USD 3 billion in an iron ore mine and pelletising facility in Minnesota.

US President Donald Trump announced the investment at the White House, describing the planned Iowa facility as the “largest steel plant in American history”. The project is expected to begin production around 2030 and produce about 10 million tonnes of steel annually.

The Minnesota mine at Nashwauk, on the Mesabi Iron Range, is expected to produce about 7.5 million tonnes of iron ore a year and employ around 350 people once fully operational. The company says it would be the first new iron ore mine built in the US in about 50 years.

The mine will supply direct-reduction-grade iron ore pellets to the Iowa complex, creating an integrated “mine-to-mill” supply chain within the US.

Mesabi Metallics said the overall project would create more than 8,000 construction jobs and at least 1,750 permanent jobs once operational. It also estimated USD 95 billion in economic output during construction and the first 10 years of operations. The Iowa complex will use direct-reduced iron and electric arc furnace technology, which the company said would lower energy use and emissions compared with conventional blast furnace steelmaking.

Rewant Ruia, chairman of Mesabi Metallics, said the project would connect Minnesota’s iron ore resources with steelmaking in Iowa to produce “100 per cent American steel”. Trump linked the investment to his administration’s 50 per cent tariff on imported steel, saying companies were choosing to manufacture in the US to avoid tariffs. The project thus marks a major expansion of Essar’s US manufacturing presence and shifts more of its steel production closer to the American market.

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