Cleveland-Cliffs enters pellet supply contracts

Cleveland-Cliffs Inc. announced Wednesday it has entered into long-term agreements to supply iron ore to both AK Steel and Republic Engineered Products Inc. Cliffs has entered into a seven-year supply agreement with AK Steel, which will last from January 1, 2007 through 2013. Cliffs will supply between 0.9 million and 1.4 million net tons of pellets per year. The new deal replaces the previous spot-sales arrangements with AK Steel. With Canton, Ohio-based steelmaker Republic, Cliffs has entered a 63-month contract, extending from October 1, 2006 until December 31, 2011. Under the terms of their agreement, Cliffs will supply a percentage of Republic's annual pellet requirements, which are estimated to range from 400,000 to 800,000 net tons per year. This agreement also replaces a spot-sales arrangement. Donald J. Gallagher, president of North American Iron Ore and CFO for Cleveland-Cliffs, told the press that with these two new deals, 100 percent of Cliffs' current North American pellet output is committed to customers under long-term sales agreements.