Cliffs Natural Resources Commences United Taconite Restarts, Boosts 2016 Sales Forecast

Cliffs Natural Resources Inc. CLF revealed Thursday that it would be restarting operations in August at its United Taconite mining facility (UTAC) in Minnesota. According to the company, this restart would happened two months ahead of schedule than the expected October 2016 start date following the announcement of its 10-year supply agreement with a major steel client.

Cliffs Natural Resources said the August restart of UTAC was made possible due to additional business recently contracted with U.S. Steel Canada to supply the majority of their iron ore pellet requirements for the third and the fourth quarters of 2016.

The company also indicated it was boosting its 2016 sales volume guidance to 18 million long tons from its previous guidance of 17.5 million long tons. Aside from that, 2016 production volume guidance has been increased by 500,000 long tons to 16.5 million long tons.

Cliffs' Chairman, President and CEO, Lourenco Goncalves, commented: "The vast majority of the steel companies in North America are currently enjoying stronger order books, and their demand for high quality iron ore pellets from a reliable supplier is increasing. With that, Cliffs' business continues to gain very positive momentum, with the improvement of the existing business with our long established clients and the addition of new ones."

He continued, "We are very pleased to announce an increase of our pellet supply to U.S. Steel Canada, who became a new Cliffs' client in 2016. US Steel Canada used to be a captive client of its former parent company U.S. Steel Corporation. We are also very pleased to announce a higher sales guidance for 2016, thanks to this new business with U.S. Steel Canada, which came at a higher tonnage than we had previously anticipated."

The company stated United Taconite consisted of an iron ore mine and a pellet processing plant, and is located in Minnesota.

The stock traded 4.8 percent down on Thursday.