SYDNEY, April 7, 2026, 08:18 AEST
- Mesabi Metallics has lined up $150 million in backing from Macquarie, aiming for a third-quarter 2026 launch of its Minnesota DR-grade iron ore mine and pellet plant.
- The project locked in a $520 million facility from Breakwall Capital, plus up to $10 billion in backing from the U.S. Export-Import Bank.
- Back in February, Macquarie reported that its Commodities and Global Markets division delivered a much larger contribution versus the previous year.
Mesabi Metallics, backed by Essar, said April 6 it has secured $150 million in funding from Macquarie Group to help launch its Minnesota direct-reduction iron ore mine and pellet facility, with startup targeted for the third quarter of 2026.
Timing is key here. The new cash brings more private money into a U.S. steel raw-materials venture that’s already secured support from the Export-Import Bank of the United States, at a moment when Washington is ramping up efforts to bolster manufacturing, infrastructure and defense-linked supply chains. Macquarie, for its part, gets to keep building on momentum in a business it noted in February had picked up compared to the previous year.
DR-grade ore—short for direct-reduction grade—is a higher-quality pellet favored in newer steelmaking processes. According to EXIM, the Mesabi project targets annual output of roughly 7 million tons of pellets. Mesabi notes the mine and plant together span over 16,000 acres in northern Minnesota.
Calling the Macquarie funding “another major step forward,” Mesabi’s president and CEO Joe Broking said the move signaled confidence in the project’s strategic weight and scale. Mesabi Metallics –
Mike Burns, senior managing director at Macquarie Group’s Commodities and Global Markets unit, put it plainly: the bank’s “longstanding financing relationship” with Essar now stretches into Essar’s U.S. metals and mining portfolio. Burns called Mesabi a key asset for the U.S. steel industry. Mesabi Metallics –
Fresh funding comes on the heels of a $520 million senior secured credit line from Breakwall Capital. According to Mesabi, over 800 construction workers are now on the ground, while Essar’s equity contribution has already topped $2 billion. The full project budget stands near $2.5 billion.
Macquarie’s February update pegged assets under management at A$736.1 billion as of Dec. 31, with the Commodities and Global Markets segment delivering a much stronger performance than a year ago. The group continued to strike a cautious note on the near term, pointing to market conditions, geopolitical risks, and deal completion as key uncertainties.
A flurry of activity for Macquarie. On April 2, Macquarie Asset Management announced it extended £100 million in debt to UK housing association Places for People. Back in February, Dubai Aerospace Enterprise revealed plans to acquire Macquarie AirFinance in a deal valued at roughly $7 billion. The Mesabi deal comes on the heels of these moves.
Execution risk remains the big question mark here. Mesabi’s mine and pellet plant are still under construction, with the company aiming for a third-quarter launch. Back in February, Macquarie flagged market conditions, geopolitics, and deal timing as factors likely to influence the short-term picture.
