Cleveland-Cliffs

Cleveland-Cliffs Inc. is a Cleveland, Ohio business firm that specializes in the mining and beneficiation of iron ore. The firm, which believes it is the largest producer of beneficiated iron ore pellets in North America, is an independent company whose shares, as of December 2006, are traded on the New York Stock Exchange. On the same date, the firm stated that it had approximately 4,000 employees and a 28% share of the iron ore pellet market. [http://www.cleveland-cliffs.com/general/] Its ticker symbol is CLF.

History: 1800s

The first predecessor of the firm to come into existence was the Cleveland Iron Mining Company, founded in 1847. Samuel L. Mather and six associates had learned of rich iron ore deposits recently discovered in the highlands of the Upper Peninsula region of Michigan. Soon afterwards, the first Soo Canal opened in 1855, allowing iron ore to be shipped from Lake Superior to Lake Erie.

Technological improvements, such as the Bessemer furnace, made it possible for the North American Great Lakes to produce steel on an industrial scale. The south shore of Lake Erie was close to a supply of coal, making that region an efficient point for the construction of steel mills.

The final decades of the 1800s were a period of business consolidation from the partnership-sized businesses of an earlier generation to a new type of business firm, the stock-market-traded corporation intent on maximizing market share. The former Cleveland Iron Mining Co. was a survivor of this shakeout, purchasing many of its competitors. One key merger in 1890, with Jeptha Wade's "Cliffs Iron Company" led the combined firm to change its name to the Cleveland-Cliffs Iron Company.

The consolidated Cleveland-Cliffs invested substantial sums in its operations to improve the logistics of iron ore transport. In 1892, the firm built the Lake Superior and Ishpeming Railroad to carry iron ore from the mines directly to company-owned docks on Lake Superior.

History: 1900s

William G. Mather, the son of Samuel, guided Cleveland-Cliffs as President and later as Chairman of the Board during the period of 1890-1947, participating in the transition from the hard-rock iron ore of Upper Michigan to the soft hematite of Minnesota's Mesabi Range and adjacent lodes.

Under Mather, Cleveland-Cliffs was a leader in the development of the classic-type lake freighter, a bulk-cargo vessel especially designed to carry Great Lakes commodities. The 618-foot (188 m)-long "William G. Mather", launched in 1925, is a surviving example of this boat type. For almost a century, the black-hulled Cleveland-Cliffs boats were familiar sights on the upper Lakes.

Demand for American iron ore hit peaks during World War I, World War II, and the consumer boom that followed the second war. The Mather A Mine opened in the early 40's and the Mather B shaft in the 50's. As the Cold War continued, reserves of mineable hematite dwindled in northern Minnesota and Cleveland-Cliffs returned some of its focus to its traditional areas of interest around Marquette, Michigan, where new deposits of magnetite were opened. The First Pellet Plant was built at Eagle Mills in 1954, followed by the first Grate/Kiln Plant at the Humboldt Mine in 1960. The Republic Mine was converted from a shaft mine to an open pit and concentrator in 1956 and added a two kiln pellet plant in 1962. The Empire Mine opened in 1963 and was expanded in the mid and late 70s; the Pioneer Pellet Plant was opened in 1965 to pelletize the underground ore from the Mather B Mine in Negaunee. In 1974 the Tilden Mine opened in Ishpeming. This mine was and is the only mine in the world with the ability to produce both hematite and magnitite pellets.

The period following the recessions of 1974-75 and 1981-83 were harsh ones for the iron ore industry. Cleveland-Cliffs shrank its operations, Closing the Mather B Mine, The Pioneer Pellet Plant and associated Ore Improvement Plant in 1979, The Humboldt Pellet Plant closed in 1981 and the Republic Mine was idled in 1981, and closed for good in 1996 when Cliffs began turning the associated tailings ponds into compensatory wetlands for their other properties. Over 50% of the Marquette Iron Range employees were laid off and Cliffs withdrew from the Great Lakes shipping industry in 1984.

The present: 2000s

In 2002 LTV Steel which was a partner in the Empire Mine managed by CCI closed. The Empire was idled for 6 months. Cleveland Cliffs Stock plummeted. The President enacted steel tariffs that helped domestically produced steel rebound.

In the years after The Steel Tariffs, a sharp increase in steel production in China and other developing countries led to a significant upswing in the price of global iron ore. This trend benefited Cleveland-Cliffs after the two lean decades that had preceded it. To remain competitive Cleveland-Cliffs decided to expand globally and to diversify into other minerals, leading to the acquisition of iron ore properties in Brazil and Australia and coal properties in Australia and the US.

The stock of Cleveland Cliffs has appreciated substantially since early 2000. A ten thousand dollar investment in 2003 would be worth nearly a million dollars today.

In June 2007 Cleveland Cliffs purchased its first domestic coal property. The company, called PinnOak, once belonged to U.S. Steel; it mines coal in Alabama and West Virginia.

The firm has deposited many of its papers, covering transactions prior to 1981, in the Historical Collections of the Great Lakes at Bowling Green State University. [http://www.bgsu.edu/colleges/library/hcgl/glms0062.html]

External links

* [http://www.cleveland-cliffs.com/ Cleveland-Cliffs web site]