Magnetation Closing Plant 2 in Bovey MN
7 out of 11 Major Iron Ore Facilities Closing
Magnetation LLC Announced a potential production curtailment of it’s Plant 2 facility located in Bovey.
This is the latest of a string of mine closures across the range.
If Magnetation’s Plant 2 closes, 7 out of the 11 major iron ore related facilities across the Iron Range will be closed, or very close to closing.
This is because the price and demand for iron ore has dropped significantly, for a number of reasons.
One is that the global production of ore has increased, and foreign made steel being imported in to the country has cut the demand for iron ore in Minnesota.
The industry has also taken a hit due to Material Substitution. As an example, the Ford F 150 switched its body outer to aluminum, to reduce the weight of the vehicle for better gas mileage
Donald Fosnacht (Associate Director, Natural Resources Research Institute)
“Which lead to a displacement of something on the order of 500 thousand metric tons of iron ore for a year, just for that one model the F150,” said Donald Fosnacht, the Associate Director at the Natural Resources Research Institute.
The closure of the mining plants means more than just jobs lost in the industry
“All of the support that goes in from Duluth to the Iron Range companies that actually service those mines are impacted by this too.”
Magnetation released a statement that says they are unsure how long the potential curtailment of Plant 2 may last, but are hopeful that the production will resume in 2016.