Mesabi Trust Press Release

Announcement of No Distribution

The Trustees of Mesabi Trust (NYSE:MSB) have determined that no distribution will be declared this July 2023 with respect to Units of Beneficial Interest. This compares to a distribution of Eighty-four cents ($0.84) per Unit for the same period last year.

The Trustees’ announcement today of declaring no distribution this quarter primarily reflects that the Trust has received no royalty revenue in the Trust’s last three fiscal quarters, and the current uncertainties related to announcements by Cleveland-Cliffs Inc. (“Cliffs”) concerning its plans for operating Northshore Mining Company (“Northshore”). Following the idling of Northshore (from May 2022 until April 2023), in April 2023 Cliffs made several announcements concerning Northshore, which included announcing a partial restart of Northshore’s iron ore operations, a plan to operate Northshore at less than full capacity for the remainder of this year, and an intention to continue to treat Northshore as a swing operation. On April 28, 2023, Cliffs also reported negative pricing adjustments for prior periods, which were recognized in the last quarter of the Trust’s fiscal year ended January 31, 2023. This increased the contract liability portion of the Trust’s unallocated reserve by $2,298,121, thereby in effect reducing the Trust’s future royalty revenues.

Accordingly, the Trustees’ decision announced today reflects their determination to maintain an appropriate level of reserves in order to make adequate provision to meet current and future expenses and present and future liabilities (whether fixed or contingent) that may arise in the future.

The Trustees have received no specific updates on Cliffs’ plans for the remainder of the current year concerning Northshore iron ore operations. The Trustees’ determination of no distribution this quarter also takes into account numerous other factors, including uncertainties resulting from Cliffs’ prior announcements to increase the use of scrap iron in its vertical supply chain planning, potential volatility in the iron ore and steel industries generally, national and global economic uncertainties, the cost and expense related to the Trust’s pending arbitration against Northshore and its parent, Cliffs, further potential disturbances from global unrest and the potential impacts from future outbreaks of the coronavirus (COVID-19) pandemic.