This blog reports events and interesting tidbits from Rensselaer, Indiana and the surrounding area.

Monday, June 10, 2013

Reynolds, a new steel town?

While watching the news on WLFI, I saw an ad about a company called Magnetation opening an iron-ore pellet plant in Reynolds, Indiana. The web page for Magnetation says that they are a new company and that they mine the waste of old iron mines in northern Minnesota. (The Mesabi range was an incredibly rich source of iron in its day, and I recall visiting some of the huge mines when I was growing up in Minnesota.)

A press release from November says that the new plant will become operational in late 2014 or early 2015 and employ about 100 to 120 people. The cost of the plant is given as $300 to $350 million. Another press release from May 20 of this year said that the company had found financing for the venture.

If the raw material comes from Minnesota, it may be shipped through the Great Lakes to the the south end of Lake Michigan. If it then is transported by rail, it seems likely to be passing through Rensselaer on the CSX line. Reynolds also has the Topeka, Peoria, and Western Railroad running through it (the railroad coming through Kentland and Remington), but that railroad runs east-west and does not seem like a route that would be used to get the iron ore from Lake Michigan.

I do not understand why Reynolds is a good location for a plant like this. It seems to be far from both the source of raw material and the market for the finished product. If anyone knows more, I would like to hear it.

2 comments:

Anonymous said...

The plant would be conveniently located as far as AKSteel (Magnetation's minority owner) is concerned, since it has mills in the region.

The economic incentives provided by the state, White County, and NIPSCO influenced the site selection, too; see, for example, http://www.economicdevelopmenthq.com/blog/magnetation-reynolds-in-iron-plant/.

Serge Cote said...

Most of the time it's all about taxes cut that they get to go there. :)