During the past two years, a variety of articles have appeared in such magazines as Fortune, the Saturday Evening Post, Time, Journal of Metals & Mining Engineering, and others as well as newspaper stories covering Congressional Hearings having to do with the recent rise in steel prices, Reconstruction Finance Corporation loan provisions, and strategic materials stock piling. These deal with the various facets of the problem brought about by the approaching end of the era of high grade iron ore from the Lake Superior District and the steps being taken or the plans being made to procure this most vital of raw materials from other sources.
As most of the new sources under consideration are located out of this country beyond the seas or on rivers, the ore will travel by ship; these ore vessels will ply the seas in greater size and numbers than ever before, particularly the Caribbean Sea, and something on the background of these new developments might be of particular interest. The fact that ships were sunk by submarines in the Gulf of St. Lawrence and that for a short period during 1942 iron ore shipments from Chile were halted owing to submarine losses during the last war have more than historical interest. The need for adequate protection for these ore carriers is more important than ever before in view of the decline in U. S. iron ore reserves and the developments of deposits overseas. The Navy will be primarily responsible for getting these vessels safely across the Caribbean, the South Atlantic, down the coast from Labrador, across the Gulf of Mexico to Mobile, from Africa or Brazil, as the case might be. Some of these developments of new sources of ore were only announced at the beginning of 1950 and most of the present plans were made since the end of the War. This article attempts to give an up to date picture of the search for new sources of iron ore, and if something in this fast moving drama has been missed, it must be excused. After all only four years ago the existence of the largest of the developments was not even known.
To understand the importance of the Caribbean Sea in the search for new sources of iron ore, it will be well to review the past sources of iron ore deposits used by this country.
For the past fifty years over 85% of all iron ore supplied to the United States has come from the Lake Superior District and over 80% of the present steel productive capacity has been built with relation to the Lake Superior supply of iron ores. The other ore producing areas such as the Birmingham District, the Adirondacks, Utah etc., plus small quantities from Chile, Sweden, Cuba, etc., have furnished only 15% of our requirements. The greatest ore bodies lie in the Lake Superior District, which is the Upper Peninsula of Michigan, Wisconsin, and Minnesota. In Michigan there are two ranges, the Marquette and the Menominee. The Menominee ore moves down into Lake Michigan and is shipped out of Escanaba. The Marquette Range moves into Lake Superior and is shipped out of Marquette. The Geobic Range lies partly in Michigan and partly in Wisconsin. These three ranges are chiefly underground mines. Underground mines are mines where deep shafts are sunk and the ore is hoisted through those shafts. Some mines produce ore 3,500 feet below the top of the shaft.
Moving into Minnesota, the big Mesabi Range is 110 miles long. The ore deposits are shallow and extensive and covered by a glacial till to a depth of 10 to 50 feet. North of that is the Vermilion Range and southwest is the Cuyuna Range. Both the Mesabi Range and the Cuyuna Range are principally open pit mining. The dirt is taken off the ore body and steam or electric shovels scoop up the ore and load directly into railroad cars which move down to the big ports of Superior, Duluth and Two Harbors. The ore loading docks are built nearly a half mile out into Lake Superior, are 80 feet above the water and consist of hundreds of ore pockets capable of holding 300 tons each. Hopper cars from the mines are pushed out along the top of the pier and their contents are dumped into the ore pockets. When one or more of the ore vessels are tied up alongside, the ore pockets feed the ore into movable chutes which guide the ore down into the open hatches of the vessel. Because of ice, shipments cease for four or five months, depending on the severity of the winter.
In times of emergency open pit mining can be expanded rapidly because additional tonnage can be obtained by simply stripping the surface and moving in with large equipment. The underground mines are restricted in their expansion of output as only a small amount can be hoisted up at a time through the pit head. Were a large part of the remaining open pit ore to be set aside as a strategic reserve, the steel industry would have the greatest difficulty in rapidly creating new production from other than open pit sources.
The ore vessels carry as much as 18,000 tons with a draft up to 18 feet. These vessels move across Lake Superior and through the Soo Canal. Some 25% of the ore shipped goes into Lake Michigan to unload at Chicago, Indiana Harbor and the Gary area. The remainder of the shipped ore, some 56 million tons in 1947, goes in vessels through Lake Huron into Lake Erie and to the great steel mill area of the Ohio River and the Pennsylvania-Ohio District including Pittsburgh, Youngstown, Cleveland, Wheeling etc. Coal comes up from mines in West Virginia, Pennsylvania, Ohio and Kentucky to be consumed in the coke ovens of the mills using this ore.
To give some idea of the importance of iron ore in this country during wartime, for the five pre-war years 1935 to 1939 production averaged 47 million tons per annum. In the war years 1940 through 1945 iron ore production jumped to an average of 93 million tons per year. In the post war years production is still high and studies have been made by the Bureau of Mines and the Geological Survey as to the amount of ore required in the future. It is estimated that some 85 million tons of ore will be required annually to 1960, and as the country grows in population the demand for iron and steel products will increase, and by 1970 the government agencies foresee a need for 100 million tons annually. If the Lake Superior region could continue to supply 85% of the United States ore requirements, some 1 billion tons of ore would have been shipped out of this area from 1947, the date of the estimate, to 1960.
Now we must turn from the estimated needs of this country to the estimated reserves of ore left in this area of paramount importance in supplying this country’s needs; and the tonnage, as determined by eminent geologists, Minnesota Taxation authorities, raw materials departments of steel companies and others is ominously small. As estimated by the U. S. Bureau of Mines at the end of 1946, only some 1.2 billion tons of iron ore remained in the Lake Superior Region. If we assume that some 400,000,000 more tons could be found through revised estimates upward and new discoveries, the new figure of 1.6 billion tons is dangerously low when 1 billion tons was the amount to have been furnished by Lake Superior to 1960. Not only is this amount enough to last only some 15 years at present estimates of consumption, but of that remaining only some 5 00 million tons are in open pit mines. These mines will be completely exhausted in 10 years, and were the government to step in and take over half of the remaining open pit reserves, current output of Lake Superior ore would be cut 60%. The open pit mines of Mesabi with their great capacity to expand production rapidly to meet increased demands of the last two World Wars, will no longer be able to repeat this performance. As Mr. L. S. Hamaker of Republic Steel said at the close of World War II, “This was the last World War that will be fought off the Mesabi Range.”
In view of the above forecast of ore supply disappearing, it is rather strange that the Army & Navy Munitions Board has listed in Group C iron ore, scrap iron, and steel. This listing covers materials which are not now recommended for stock piling. Mr. William O. Hotchkiss, President of the Society of Economic Geologists, in a speech made March 1947, said,
“However strong may be the hope of peace, it must not be forgotten that there is as yet no guarantee of World Peace that can be accepted as an alternate for capacity for defense. A basic measure of the ability of a nation to defend itself is its capacity to produce steel. No matter what other means of defense are available, steel is the basis of armies and shipping.”
Regarding the Army & Navy Munitions Boards action in classifying iron ore, steel, and scrap iron in Group C, he said,
“It is my opinion that this is a serious mistake. If we are to be able to produce the quantity of steel needed to meet future emergency, there must be available at the time of need adequate stock piles of one or all of these materials to supplement the steel that can be made from current production of ore and scrap. It may well be asked what is the advantage of having stock piles of chromite, manganese, nickel, tungsten, and vanadium if there is insufficient material to make the steel to be alloyed with them.”
A great deal of research, some pilot plants, and the recent announcement of the erection of a full sized plant have been brought about in an effort to make the shipment of taconite economically feasible. The ore mentioned so far is direct shipping ore; that is ore which is non-magnetic and when mined from the ground can be put directly in the blast furnace for the production of pig iron. These are the rich hematite ores, containing some 51% natural iron content, which are running out. Taconite on the other hand is the mother rock in which much of the hematite ore is found and is a dense silaceous rock through which the iron mineral is finely disseminated. There are billions of tons of this low grade iron bearing material, but to get high grade ore from it suitable for blast furnaces is difficult. It takes some three tons of this material blasted lose from hard rock formation, put through a heavy crusher and rod mill and thence through magnetic separators, ball mills and classifiers to get one ton of high grade ore concentrate of 63% iron content. The powdery concentrate must be agglomerated by pelletizing or sintering. The process leaves large amounts of tailings, requires a great deal of water, much electricity, and six times as much labor as direct shipping ores. It would take 5 years to build a plant to process 2\ million tons of concentrate per year, and the cost would be in the neighborhood of 50 million dollars in plant equipment. To gradually replace the diminishing hematite ores with the taconite concentrates of the Lake Superior regions will take years of work and well over a billion dollars will have to be spent in new plants. Were no other sources of ore available, it would be a nip and tuck race to see if these plants could be built fast enough to replace depleted ore deposits. This process, which is called beneficiating ores, is both expensive and not fully proved for large scale production; that is to say, as yet no full sized plant has been in existence long enough to demonstrate the feasibility of beneficiating these ores.
A map of the major resources will show large deposits in 12 different countries and smaller amounts spread through many other countries. Those interested in raw materials were fully aware of the rapid depletion of Lake Superior ores in World War II and the difficulties to be encountered in erecting beneficiating plants. Long before the war, exploration parties have been out all over the world in search of new sources of ore which could be economically utilized, and by 1945 the problem of future ore supplies had become acute. Field forces were sent to examine the Agalteca deposit in Honduras, in Guatemala, at Mayagues and Jancos in Puerto Rico, around Tunki in Nicaragua and up and down the west coast of Mexico. The fields in Sweden were re-examined, the Marampa and Tonkolili deposits in Sierra Leone, West Africa, those in Morocco, Tunisia, Algeria, and Liberia. The Wabana ores in Newfoundland, the famous Labrador Quebec ores, and those in British Columbia were examined. The Cuban deposits were checked and extensive exploration work was undertaken in Venezuela. The Itabira and Ceara and Amapa districts of Brazil were looked into and additional exploration was done in Chile. Some of the most convenient and largest deposits are not being developed on a large scale owing to certain characteristics of the ores. The Wabana ores of Newfoundland had a high phosphorus content, and the Cuban ores are called lateritic ores and contain nickel and chrome.
The greatest ore deposits of the Western Hemisphere are reputed to be those located in the Itabira district of Brazil. These are enough to supply the entire steel industry of the United States for 150 years. They can be mined by open pit methods and are reputed to be even richer than good Mesabi ores. These ores lie 324 miles from the ocean, northwest of Rio, and the land between is extremely mountainous and served by an antiquated railroad. The long difficult rail haul to the coast of Brazil and the long sea haul to the states around the hump of Brazil make these excellent ores expensive. During the War, the Export Import Bank lent money towards the improvement of this railroad. Recently more aid has been given. Brazil is developing a steel industry of its own at Volta Redonda. The lack of adequate coal is a serious handicap. Were vessels to bring this ore up to Chesapeake Bay, in all probability they would pick up coal at the Hampton Roads coal loading ports for the return voyage.
Under Brazilian law all ore deposits are the property of the Brazilian Government and taxation is severe. Development is permitted to Brazilian companies only, and American companies could participate in a minor capacity only. In spite of present difficulties, these deposits are so easily mined and of such high iron content, it is felt that large scale development will occur in the not too distant future.
While the existence of suitable iron ores lying south of the Orinoco River in Venezuela has been known for many years, the first company to start development of these deposits was the Bethlehem Steel Co. By the spring of 1951, it is expected that ores from Venezuela will arrive at the Sparrows Point Plant in Baltimore of the Bethlehem Steel Co. Not a great deal of information has been available regarding this development, but in October, 1949, Bethlehem Steel made the following announcement.
“Bethlehem Steel Corp., through its subsidiary, the Iron Mines Company of Venezuela, is presently developing a block of 16 mines in the State of Bolivar, Venezuela, South America. The concessions, which the company is developing at its own expense, are expected to yield up to 2 million tons of iron ore annually at the end of the present construction period. The ore is a hard, high grade hematite suitable for use in both blast furnaces and open hearth furnaces and will be shipped to the United States for treatment in Bethlehem’s eastern steel plants.
“The concessions, known as the El Pao mines, are located in what was an almost entirely undeveloped tropical jungle about 30 miles south of San Felix, a town situated near the confluence of the Orinoco and Caroni rivers, about 165 miles from the point on the coast where the Orinoco empties into the Atlantic ocean.”
“Ore will be shipped from the El Pao mines by railroad to a port site named Palua on the Orinoco river, near San Felix. Construction at Palua, now completed, includes ore storage and loading facilities, a diesel-electric power plant, water works, shops, warehouses, and a complete village for housing the employees. ...”
“Because the year is divided into a wet and a dry season, the water level of the Orinoco river has a seasonal variation of about 40 feet. For this reason it will be necessary to load the ore into river boats or barges from a conveyor belt supported on a steel structure overhanging the river. The end of this structure is high enough above the river to allow the boats to moor under it regardless of the height of the water. The ore will drop from the end of the conveyor directly into the holds of the boats. The ore will be taken to Puerto de Hierro, the tidewater transfer port, for reloading into ocean-going ore carriers. Dredging is now completed at Puerto de Hierro and the ore transfer station is under construction.”
“ . . . The elevation of the mines is about 2,000 feet above the Orinoco river at Palua and, although the location is in the tropical region, the climate is pleasant and moderate. An improved highway and a 36 mile standard gauge railroad connects the Port of Palua with the mines. . . . Initially, the open pit method of mining will be employed. Electric shovels of four cubic yard capacity will load the ore into 30 ton capacity diesel engine trucks, which will haul it to the crushing plant. ... At present about 1,500 men are being employed at the mines in addition to 900 men employed by contractors at Puerto de Hierro.”
There are known to be at least 60 million tons at the El Pao mines and other concessions nearby are still to be developed. It is thought that the ore will be loaded in 25,000 ton Venore ore carriers at Puerto de Hierro and it is possible that the Orinoco will be dredged so that these vessels may come all the way up to Palua. In addition several vessels of 6,000 ton capacity are being constructed. These have a fully loaded draft of 17 ½ feet and will carry the ore from Palua down the Orinoco to its fan-like delta and along the Cano Manamo out of the muddy delta country to the Gulf of Paria and across to the loading port which is opposite Port of Spain in Trinidad. The big carriers will pick up the ore and head out through the Mouth of the Dragon and across the Caribbean some 2,120 miles to Baltimore.
The United States Steel Co., faced with terrific outlays if diminishing ore tonnage was to be secured from beneficiating taconite, started to take one last look around at the ore sources around the entire periphery of the North and South Atlantic Oceans. It was decided to make an aerial survey west of the Caroni River and in 1947 this area was photographed from the air. Two mountains 50 miles due south of Ciudad Bolivar on the Orinoco River looked promising to the geologists and field parties testing these mountains with a device called a magnetometer, an instrument which measures the intensity and direction of magnetic forces, recorded the highest responses ever recorded in the world. Drillers were brought in and the ore was found to be about 63% iron and the Cerro Bolivar area, as the larger of the two mountains was called, has been found by drilling to contain over ½ billion tons of this rich ore. This was a really enormous tonnage of iron ore and can produce more ore than the famous Hull Rust Mine at Hibbing on the Mesabi Range has produced in its entire history. The fabulous Hull Rust pit has been known as the world’s greatest single mine and produced during the biggest war year over one quarter of United States ore production. The area is under long term lease from the Venezuelan Government and a huge development of this area is underway. A railroad is to be built, crossing the Orinoco above Ciudad Bolivar and carrying the ore from the mines or open pits at Cerro Bolivar some 274 miles to a port on the Caribbean Sea near Barcelona on the North Coast, where loading facilities will be erected. It is possible that the Orinoco will be dredged as far as the confluence of the Caroni River as mentioned before and with a channel of 34 feet large ore vessels will pick up the ore brought down by railroad to the spot where Orinoco & Caroni meet. In any event the ore is both high grade and easily mined and when the difficulties of transportation are overcome, this Venezuelan ore may well replenish a large part of the void left by the petering out of Lake Superior Ores. The ocean ore carriers planned to bring this ore to the States rival the Missouri in size, being 45,000 ton jobs. These enormous vessels ploughing across the Caribbean with their huge cargoes of ore, destined for Baltimore and Mobile to keep the furnaces at Birmingham, Pittsburgh, Trenton etc., going, will be prime targets in any future war. During the last war most of the ore used at Sparrows Point Plant came from Chile and recently these mines have been expanded at El Romeral. Five out of eight of the ore carriers owned by Bethlehem Steel were sunk in the last war in the Caribbean. The amount of ore carrying vessels crossing this area after the development of the Venezuelan deposits will be many times greater than in the past. There is a certain danger attached to a dependence on ore from a country so distant and so different from ours. Our political relations with Venezuela will be a matter of prime importance. No doubt our State Department and Department of Defence are well aware of the problems involved and inasmuch as the two leading steel companies have both started huge construction projects in Venezuela, it is felt that this country will assume the burden of supplying much of the rich ore which in the past has come from the open pits of Lake Superior.
The area in which all this activity is occurring lies within 500 miles of the Equator on the edge of the Guiana highlands of Venezuela. This is an area of rugged terrain, with high mountains, narrow valleys and waterfalls of terrific heights. Abundant water power sites are available in this area. It is one of the blank spots on the map and much of the territory has never been explored. The Caroni River is famous for its gold and diamonds, and bauxite deposits are said to lie in the area to the north in the flat llanos. Some important oil fields have been developed in this flat area which until recent times has been used only for grazing a rather scrubby type of cattle. During the rainy season, so much rain comes down that the streams and rivers cannot take the downpour away and most of the area is flooded. Those who have been down to survey the railroad right of way say that the problems involved in laying a road across flood plains are serious but not insoluble. For an area so close to the equator, the weather on the whole is rather mild as the elevation near the mines is several thousand feet high. Actual mining of the ore is simple.
Another area overseas, which is under development by one of the independent steel companies, is Liberia. Port facilities for loading ore are being erected at Monrovia, the capital, and sometime in 1951 it is expected that some 500,000 tons will be shipped out annually. Some twenty million tons of high grade ore are believed to be controlled by American Companies, and it is thought that this ore will be shipped across the middle Atlantic to Mobile, Alabama, and to Baltimore. While the reserves of ore there are not believed to be abundant, the location is easily accessible to the Port of Monrovia and only forty miles of railroad are to be built.
The area of new iron ore discovery or development which has received the most publicity is that area lying some 350 miles north of the Port of Seven Islands on the lower St. Lawrence, along the Quebec-Labrador border and known as the Ungava region. The individual ore bodies are rather small and scattered over an area 85 miles by 15 miles. A hundred miles north is another 35 miles of iron formations; this latter area is in striking distance of Fort Chimo on Ungava Bay, off Hudson Straight. The territory to the north of the lower St. Lawrence was a little known wilderness, rough and rugged, with the land rising 3,200 feet with many abrupt slopes within 50 miles north of Seven Islands. The region is practically uninhabited, with long winters and heavy snows and deeply frozen ground. To reach into the ore concessions some 400 or 500 miles of railroad will have to be built across the barren rugged tundra. Port facilities, good for only six months of the year, will be erected at Seven Islands.
The ore is rich, averaging some 59% natural iron and over 300 million tons of this high grade ore have already been proved. It lies close to the surface and can be mined without great difficulty except for the problems of handling frozen ore which is thawing en route. While the existence of iron ore in this area has been known for fifty years, large scale exploration was not begun until the second world war threatened to exhaust the Mesabi Range. The reason so little work in exploration had been done was owing to the forbidding topography of the country, severe winters, and distance from transportation facilities. Both Canadian and American mining interests combined to prove the amount of ore available as indicated by the startling discoveries of large amounts of iron ore even richer than the good Lake Superior ores. A number of the American steel companies have joined in the development and the railroad route out to Seven Islands is being surveyed. The cost of the transportation and port facilities is estimated to be in the neighborhood of $175 million and financing arrangements had not been completed as of recent date. It would seem however that this development will go ahead and probably its projected completion will no doubt revivify the St. Lawrence Seaway, and bring about the enlargement and deepening of the St. Lawrence river so that ocean vessels can reach the Great Lakes. In this event, the mills along the Great Lakes and Pennsylvania-Ohio river area will no longer be stranded with inadequate supplies of iron ore threatening them. To the harried steel men of the Pittsburgh-Gary area the Labrador ore development looks like a gift from heaven, but it will be many years before any appreciable quantity of ore will be coming out of this district. In the meantime the huge amounts of ore being dumped along the East Coast by the ore carriers from Venezuela could well change the center of the steel making facilities to a point along the Atlantic Coast. Professor Marvin Barloon of Western Reserve University in Cleveland has forecasted, even before any announcement of the Venezuelan development, that the new steel mill expansion would take place around Chesapeake Bay and Mobile, with foreign ores replacing those from Lake Superior.
In any future war a repetition of the sinkings along our Atlantic Coast and Caribbean such as took place in 1942 can have disastrous effects on our expanding war economy. It would seem that the importance of sea lanes across the Caribbean and along the Atlantic Coast have not been sufficiently emphasized. These ore developments are of such recent origin that the country is not fully aware of the vital mission the Navy will have to play in keeping the supplies of iron ore coming in from overseas. Manganese, bauxite, chrome and oil are other vital cargoes to traverse this stretch of ocean. The losses from submarines cannot be allowed to occur again. Certainly the stakes in this area are high.