Plan follows 50% steel tariffs as Republicans brace for midterms
President Trump is set to announce Mesabi Metallics’ $15 billion plan to build a steel mill in eastern Iowa at the White House on Monday, according to a White House official, as he looks to counter voter frustration with the economy ahead of the midterm elections.
Mesabi’s proposed mill would be one of the largest in the U.S., with an initial annual production capacity of 7.5 million tons and later additions potentially raising output to about 10 million tons a year, according to the White House official and Mesabi. The plant would be sited in eastern Iowa along the Mississippi River, which the company said it would use to transport iron ore from its northern Minnesota mine. The company expects to build plants at the site to process the ore for use in electric arc furnaces with scrap steel to make new steel. Steelmaking at the site could begin in 2030, and the project is expected to support more than 1,700 jobs.
Mesabi Metallics is part of Indian conglomerate Essar Group. The mine and steel mill project were first proposed by Essar about 20 years ago but went through years of delays and missed deadlines to repay state aid. The Minnesota mine project filed for bankruptcy a decade ago, and the state withdrew iron ore leases, transferring them to rival iron ore miner and steelmaker Cleveland-Cliffs. Mesabi Metallics emerged from the reorganized company in 2017 and restarted construction at its northern Minnesota site a few years later.
The $2.5 billion mine began preliminary production this month, though Mesabi controls just enough iron ore reserves for about 23 years of mining. The company has asked Minnesota to return the leases given to Cleveland-Cliffs and is suing Cliffs for alleged antitrust violations.
The domestic steel industry has been a central test case for Trump’s use of tariffs to underpin his industrial and trade policies. The president imposed steel tariffs during his first term and raised them to 50% last year, arguing that domestic steel production is necessary for national security. The duties allowed U.S. steelmakers to raise prices without the threat of lower-priced imports, and U.S. steel prices are now among the highest in the world, raising production costs for steel-dependent manufacturers.
Steel industry trade groups credit the duties with spurring more than $40 billion in investments in domestic steel production and creating thousands of additional jobs. “Weakening the tariffs now would put that progress at risk,” the groups said in a letter to Trump on Friday. “Tariffs have proven to be sound, effective trade policy.”
Last year, Trump approved the sale of U.S. Steel to Nippon Steel but required the Japanese company to invest about $14 billion in plant improvements and expansions, while reserving the right to block plant closings and other operational decisions, including any move of the company’s Pittsburgh headquarters.
Midterm election politics hang over Monday’s announcement. Republicans are facing an increasingly difficult political climate that threatens their control of Congress, with several tightly contested races on the ballot, including a Senate seat and two House districts currently held by Republicans. Iowa, which Trump won in 2024, is among states that have shifted away from the GOP.
Speculation has grown in part of southeast Iowa, near the Mississippi River, in recent days as word of a large industrial project spread. The Des Moines Register last week reported on a mystery buyer offering to purchase land in the area.