Arkansas Breaks Ground on $1.9 Billion Steel Plant Linking Minnesota Mines to Sun Belt Manufacturing

A new $1.9 billion steelmaking investment in northeast Arkansas is set to connect iron ore mined in Minnesota with advanced factories serving the automotive, appliance and solar industries.

U.S. Steel broke ground Oct. 30 on a direct-reduced-iron facility at its Big River Steel Works campus in Osceola, near the Mississippi River. The project is expected to add approximately 200 permanent jobs and up to 2,000 construction jobs at peak activity.

The plant is the latest step in an industrial expansion that has made Mississippi County a major center of American steel production. Rather than relying entirely on purchased scrap metal, the new operation will give the company another source of iron for its electric-arc furnaces.

From Minnesota iron ore to Arkansas steel

The production process removes oxygen from iron ore without melting it, creating direct reduced iron that can be used in electric-arc-furnace steelmaking. The new plant will sit next to the Big River 2 mill, allowing hot material to move directly into its furnaces.

The connection matters because electric-arc furnaces commonly rely on recycled scrap, and some higher-grade steels require carefully controlled raw materials. Direct reduced iron can replace part of the prime scrap used in the process, giving steelmakers greater control over quality, costs and supplies.

U.S. Steel also plans to produce hot-briquetted iron, a compact form that can be shipped to other destinations.

U.S. Steel plans to use ore from its Minnesota operations to supply the Arkansas plant, producing material for steel used in automobiles, household appliances and solar equipment.

A growing steelmaking center

Construction is scheduled to begin later in 2026, with preliminary site preparation already underway. The planned workforce expansion comes on top of the $3 billion Big River 2 mill, which began producing steel in 2024.

The investment continues U.S. Steel’s expansion at the Osceola site since it acquired Big River Steel in 2021, according to the Arkansas Economic Development Commission.

The new facility is designed to support steelmaking with lower emissions than conventional approaches, though the actual environmental benefits will depend on the energy and fuel used to operate it. Detailed operating emissions and resource requirements have not yet been established in the public project announcements.

What the investment means beyond Arkansas

The project is expected to employ up to 2,000 construction workers at peak activity and about 200 permanent workers.