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Cleveland-Cliffs commits $1 billion to Middletown Works, keeping the blast furnace route

Cleveland-Cliffs and the US Department of Energy will split a $1 billion upgrade of Middletown Works in Ohio, rebuilding the blast furnace by early 2030.

By Loharo EditorialPublished Updated 3 min read
Blast furnace beside a yard of hot-rolled steel coils
Illustration of a blast furnace and hot-rolled steel coils

Cleveland-Cliffs will spend $1 billion modernising its Middletown Works in Ohio, with the US Department of Energy paying half. The money goes into a rebuilt blast furnace and a power plant fed by furnace gas.

What happened

On 21 August 2026 Cleveland-Cliffs said the DOE had agreed a framework to “rescope” a $500 million grant it had already awarded for Middletown. The total project is now $1 billion, shared equally between the company and the DOE, and will be spent over about four years while the plant keeps producing (Cleveland-Cliffs release).

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  • The package covers blast furnace upgrades, new material handling, AI-based process control and a cogeneration plant that turns blast furnace gas into electricity and steam for the site.
  • Cliffs plans to complete the blast furnace rebuild in the first quarter of 2030.
  • Middletown makes about 3 million tons of raw steel a year, mainly automotive grades for exposed car body parts. Cliffs says the project preserves 2,300 jobs and will employ more than 1,500 construction workers at its peak.

Ohio EPA issued the final air Permit-to-Install P0139876 on 9 September 2026 for the Middletown Works cogeneration plant, blast-furnace changes and related equipment (Ohio EPA final PTI P0139876). AIST reported the decision on 8 October (AIST).

Why it matters for steel buyers

This is a US story, but it says something about where the industry is going. In March 2024 the DOE selected Middletown for award negotiations on a grant of up to $500 million to replace the blast furnace with a hydrogen-ready direct reduced iron plant and two electric melting furnaces (Cleveland-Cliffs, 25 March 2024). The new release says that grant has been “rescoped”. Now the money helps extend the furnace’s life. Cliffs says it does not need new ironmaking technology to keep making exposed automotive grades at home.

For EU buyers the direct trade impact is small, because Cliffs sells almost entirely in North America. The indirect point matters more. Under the US tariff regime, American automotive sheet capacity is being protected and modernised rather than cut back. That leaves fewer reasons for US mills to push surplus coil into export markets, and it leaves European mills competing for decarbonisation funding with policies that now differ sharply across the Atlantic. Our regional risk outlook covers how these policy splits affect sourcing.

What to watch

  • Whether the blast furnace work stays on schedule for Q1 2030 without unplanned outages at Middletown.
  • Final DOE contract terms. The release describes a framework for finishing negotiations, not a signed final agreement.
  • Whether other US grant recipients rescope projects the same way. Compare EU projects such as HKM’s planned EAF in Duisburg in our European capacity tracker.

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By Loharo Editorial. Facts, analysis and uncertainty are labelled in line with our editorial standards. Report an error – corrections are dated and noted on the article. Information and analysis only, not investment advice.

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