ArcelorMittal signs 10-year deal to bring iron ore to East Chicago

Iron ore pellets are a crucial input, along with coke and limestone, for making iron in blast furnaces.

"The market-based pricing mechanisms at the core of this agreement provide ArcelorMittal USA with increased financial flexibility, better aligning raw material costs with pricing conditions in the steel market,” ArcelorMittal USA President and Chief Executive Officer John Brett said. "Similar to the previous agreements, the new agreement also allows us to adjust volumes based on market conditions."

Under the contract, the iron ore prices ArcelorMittal will pay will vary based on market indices, as well as general inflation. Neither side is disclosing the exact terms of the deal for competitive reasons.

The new deal replaces previous agreements that expired in December and January. ArcelorMittal's new agreement with Cliffs, which operates mines in Minnesota and Michigan, establishes a minimum iron ore volume of 7 million long tons annually, which is higher than what was agreed to in the two previous contracts combined.

"We arrived at a mutually beneficial agreement, as both companies recognize the importance of bringing sustainable value to our respective businesses," Cliffs' Chairman, President and CEO Lourenco Goncalves said. "The signing of the new supply agreement confirms what we have always stated regarding the strength of the business relationship between Cliffs and ArcelorMittal USA."

The CEO added the new agreement removes any remaining uncertainty about Cliffs, and supports its confidence in a bright future for the company, its employees, its shareholders, and all other stakeholders, including communities.