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Released May 12, 2025 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Cleveland-Cliffs Incorporated (NYSE:CLF) (Cleveland, Ohio), which is the largest supplier of automotive-grade steel in the U.S., expects to cut 2025 capital expenditures (capex) from $700 million to approximately $625 million and plans to boost its financial standing by fully or partially idling six facilities. Industrial Info is tracking US$3.6 billion worth of active and proposed projects across the U.S. and Canada from Cleveland-Cliffs, although the company expects a $1 billion-plus project will see a reduced cost in the future.
Cleveland-Cliffs reported an adjusted net loss of $456 million in the first quarter, compared with a loss of $67 million in first-quarter 2024, while revenue of $4.46 billion was down roughly 11% compared with the year-ago quarter.
"Our first-quarter results were negatively impacted by underperforming non-core assets and the lagging effect of lower index prices in late 2024 and early 2025," Chief Executive Officer Lourenco Goncalves said in the earnings-related press release. "As a result, we are taking decisive action to streamline our operations and enhance efficiency. This will drive meaningful fixed cost savings and sharpen our focus on our core strength: supplying steel to the automotive industry."
The company reported 2024 capex in a range of between $600 million and $650 million.
Goncalves said he expects "dramatically reduced growth capital expenditures going forward due to likely changes in scope on major projects."
On the earnings-related conference call, Goncalves indicated President Donald Trump's "energy priorities" could impact low-carbon steel projects that currently have Biden-era funding pledged by the U.S. Department of Energy (DOE), in Middletown, Ohio (Middletown Steel Works) and Butler, Pennsylvania (Butler Steel Works).
Cleveland-Cliffs has been evaluating the addition of a $1 billion-plus hydrogen-powered direct reduced iron (DRI) plant as well as two electric melt furnaces at the 2.7 million-ton-per-year Middletown Works. Goncalves said the company is working with the Trump administration to explore changes to the scope, which "would entail a substantially lower cost project," and it would be fair to assume it will be "substantially altered."
The company also is exploring replacing two natural gas-fired, high-temperature slab reheat furnaces at the 1 million-ton-per-year Butler Steel Works with four electrified induction furnaces to improve production efficiency. Goncalves offered a less murky outlook for the project at the Butler Steel Works, though, noting the DOE grant amount is only $75 million; and more importantly, it is the only grain-oriented electrical steel (GOES) mill in the U.S.--which makes its production "critical to energy security." GOES steel is used in power transformers and generators.
"We are still big fans of this project for its economics, low capital burden and enhancement of our most profitable business, the production of GOES," he said.
Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project and Plant databases can click here for related project reports and here for the plant profiles.
The company also will halt capital toward construction of a transformer production plant in Wierton, West Virginia, "due to changes in scope from the project partner that no longer meet Cliffs' investment requirements."
The shift away from non-core assets includes:
Despite the shake-up, Goncalves said the Trump administration's efforts to boost domestic auto production will benefit the company: "We are already seeing some of our most important customers shift overseas production back to made in USA vehicles. We are enjoying meaningful success in working with both domestic and international auto OEMs [original equipment manufacturers] in securing longer term automotive steel supply as they run their existing factories in the U.S. at higher utilization rates and make plans to build new plants to expand domestic automotive production."
Subscribers can click here for a full list of active and planned projects from Cleveland-Cliffs.
Click here for the reports on all of the projects discussed in this article and here for the plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
Cleveland-Cliffs reported an adjusted net loss of $456 million in the first quarter, compared with a loss of $67 million in first-quarter 2024, while revenue of $4.46 billion was down roughly 11% compared with the year-ago quarter.
"Our first-quarter results were negatively impacted by underperforming non-core assets and the lagging effect of lower index prices in late 2024 and early 2025," Chief Executive Officer Lourenco Goncalves said in the earnings-related press release. "As a result, we are taking decisive action to streamline our operations and enhance efficiency. This will drive meaningful fixed cost savings and sharpen our focus on our core strength: supplying steel to the automotive industry."
The company reported 2024 capex in a range of between $600 million and $650 million.
Goncalves said he expects "dramatically reduced growth capital expenditures going forward due to likely changes in scope on major projects."
On the earnings-related conference call, Goncalves indicated President Donald Trump's "energy priorities" could impact low-carbon steel projects that currently have Biden-era funding pledged by the U.S. Department of Energy (DOE), in Middletown, Ohio (Middletown Steel Works) and Butler, Pennsylvania (Butler Steel Works).
Cleveland-Cliffs has been evaluating the addition of a $1 billion-plus hydrogen-powered direct reduced iron (DRI) plant as well as two electric melt furnaces at the 2.7 million-ton-per-year Middletown Works. Goncalves said the company is working with the Trump administration to explore changes to the scope, which "would entail a substantially lower cost project," and it would be fair to assume it will be "substantially altered."
The company also is exploring replacing two natural gas-fired, high-temperature slab reheat furnaces at the 1 million-ton-per-year Butler Steel Works with four electrified induction furnaces to improve production efficiency. Goncalves offered a less murky outlook for the project at the Butler Steel Works, though, noting the DOE grant amount is only $75 million; and more importantly, it is the only grain-oriented electrical steel (GOES) mill in the U.S.--which makes its production "critical to energy security." GOES steel is used in power transformers and generators.
"We are still big fans of this project for its economics, low capital burden and enhancement of our most profitable business, the production of GOES," he said.
Subscribers to Industrial Info's Global Market Intelligence (GMI) Metals & Minerals Project and Plant databases can click here for related project reports and here for the plant profiles.
The company also will halt capital toward construction of a transformer production plant in Wierton, West Virginia, "due to changes in scope from the project partner that no longer meet Cliffs' investment requirements."
The shift away from non-core assets includes:
- a full idle of the Minorca mine and a partial idle of the Hibbing Taconite mine, both in Minnesota, "primarily to re-balance working capital needs and consume excess pellet inventory produced in 2024."
- idling the blast furnace, basic oxygen furnace and continuous casting facilities at Dearborn Works in Michigan
- a full idle of the Steelton steel mill in Pennsylvania, "primarily as a result of excess rail imports, continued underperformance, and financial losses"
- a full idle of its Conshohocken, Pennsylvania, plate finishing facility
- a full idle of its Riverdale, Illinois, compact strip mill facility, in part due to Cliffs' ability to run the neighboring Indiana Harbor facility more efficiently
Despite the shake-up, Goncalves said the Trump administration's efforts to boost domestic auto production will benefit the company: "We are already seeing some of our most important customers shift overseas production back to made in USA vehicles. We are enjoying meaningful success in working with both domestic and international auto OEMs [original equipment manufacturers] in securing longer term automotive steel supply as they run their existing factories in the U.S. at higher utilization rates and make plans to build new plants to expand domestic automotive production."
Subscribers can click here for a full list of active and planned projects from Cleveland-Cliffs.
Click here for the reports on all of the projects discussed in this article and here for the plant profiles.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
