In the past, I have repeatedly criticized Cliffs as the company has done a lot of things that it should not have done. The new CEO (Gary Halverson) is here and he is cleaning house.
- The Ring of Fire chromite mine is cancelled and halted “indefinitely” (Nov 2013). This is smart because the project isn’t close to being economic.
- Phase II of the Bloom Lake expansion has been put on hold “indefinitely” (Feb 11 2014). This is smart because the expansion project is risky and very marginal.
- Halverson is willing to talk to activist shareholders.
- Halverson strikes me as open and honest with shareholders.
If I was any good at predicting commodity prices, I would seriously investigate a long position in Cliffs. Unfortunately I am terrible at predicting commodity prices.
*Disclosure: No position in CLF.