Essar to Invest $18 Billion in US, Including $15-Billion Iowa Steel Plant
The Essar Group, the Indian industrial conglomerate, plans to invest $18 billion in the United States, including a $15-billion steel plant in Iowa, US President Donald Trump announced at an Oval Office event attended by members of the Ruia family that owns the company.
The Iowa facility will be built by Essar's US subsidiary, Mesabi Metallics, and is intended to form part of an integrated steel supply chain in the United States, with iron ore drawn from the company's operations in Minnesota. According to the White House, the entire production process will take place on American soil.
Mr Trump described it as the "largest steel plant in American history". "It's the largest plant, one of the largest plants in the world, but it's the largest plant in America by far," he told reporters. No independent confirmation of the claim was immediately available.
The plant is projected to begin production in 2030 and to produce 10 million tonnes of steel a year once fully built out. The announcement did not include details on financing, environmental clearances or construction schedules beyond the 2030 target.
Mr Trump credited the investment to the 50 per cent tariff on steel imports imposed by his administration last year, saying the American steel industry was "roaring back to life". "Everyone is building their plants here because they don't want to pay tariffs," he said. "It's really not that complicated." Such tariffs are generally welcomed by domestic steel producers, while manufacturers that buy steel have said higher input costs add to their expenses.
Mesabi Metallics Chairman Rewant Ruia thanked the administration for "bringing back the importance of building things in America". Joe Broking, chief executive of Mesabi Metallics, called the announcement a "major moment for US-made steel", noting that steel is a critical input for national defence, cars and trucks, shipbuilding, household appliances, energy and infrastructure.
The announcement carried political weight in Iowa, a state that has become increasingly competitive in recent elections and one Mr Trump said he would visit for a rally in the coming weeks. Among those present were Representative Ashley Hinson, who is running for the US Senate, and Representative Mariannette Miller-Meeks, who is seeking re-election. Governor Kim Reynolds and Senator Joni Ernst, neither of whom is seeking a new term, also attended.
The Essar Group was founded in 1969 by brothers Shashi Ruia and Ravi Ruia and has interests spanning energy, mining, technology and retail, according to its website. Its Indian assets include the country's largest single-location steel facility at Hazira in Gujarat and its second-largest single-location refinery at Vadinar. It also owns Shell's former Stanlow refinery in the United Kingdom and has announced plans for a low-carbon steel plant in Saudi Arabia.
Mesabi Metallics, based in Nashwauk, Minnesota, has been operational since 2007, when it acquired Minnesota Steel. The company says it controls more than 1.4 billion tonnes of iron ore resources.
Essar's is among the larger recent commitments by an Indian company in the United States. Foreign investment announcements of this size typically take years to move from announcement to construction, and depend on permits, power supply and conditions in the steel market.
