The Biggest Steel Plant in US History Is Coming; Some Hawkeyes Don’t See It That Way

Big announcement. Big deal. A few little asterisks.

Last week, business and political leaders gathered at the White House to announce a new $15 billion steel mill planned for Iowa that they said will support 1,750 jobs and process up to 10 million tons per year. With supply from neighboring Minnesota’s first new iron-ore mine in half a century, “the largest steel plant ever built in the United States” would represent a new day for US industry. But, on Friday, legislators in the Hawkeye State were told the mill is “not a done deal” after they were called in to rush approval for $1.4 billion worth of incentives because the company behind the project insisted on receiving more than what Iowa law allows.

A Bright Future and an Underwhelming Past

Building the new plant is Minnesota-based Mesabi Metallics, a subsidiary of Indian conglomerate Essar Group. The White House proclaimed the company’s plans to set up shop in Iowa are a sign of America’s domestic steel industry “roaring back to life” under the 50% tariffs on steel imports the Trump administration introduced last year.

Iowa Economic Development Authority Director Debi Durham told state senators Friday that she was “surprised” by President Donald Trump’s statement that the project was a “done deal” because, as she plainly put it, “this is not a done deal.” In fact, officials learned after the announcement that Mesabi would not build in the state unless Iowa lawmakers awarded it double the state’s 5% tax credit for capital projects of at least a billion dollars. Legislators were called in for a special session to approve a $1.4 billion incentive package, the largest in Iowa history, over the objections of Democrats and some Republicans. “In my area, we have John Deere, which has served Iowa and the nation and the world for over 100 years, and they don’t get a $1 billion tax break,” Dave Sires, a Republican state senator who said the subsidy shouldn’t be given to foreign firms, told WHO 13 Des Moines. Other critics worried about Mesabi’s own complicated history and megaprojects of the past that have underdelivered for the region:

• Mesabi emerged from bankruptcy in 2017, a year after failing to complete a planned iron-ore mine in Minnesota and ending up $1 billion in debt. KCCI Des Moines reported Friday that it’s still repaying the North Star State for public funds it received for that project. 
• And Midwesterners haven’t forgotten, during the first Trump administration, when Wisconsin was promised a $10 billion Foxconn factory, lured with local and state tax incentives, that was to transform the town of Mount Pleasant into an economic powerhouse and bring 13,000 jobs. Only a small fraction of that, a $1 billion investment and 1,400 jobs, ever materialized.

Owners Away: The plant would not be the first major victory for a foreign firm in US steel production in recent years. Last year, Trump greenlit the takeover of US Steel by Japan’s Nippon Steel, which he opposed during the 2024 election, after negotiating a “golden share” that gave the US government a veto over major decisions like plant closures.