The Trustees of Mesabi Trust (NYSE: MSB) declared a distribution of ninety-one cents ($0.91) per Unit of Beneficial Interest payable on November 20, 2010 to Mesabi Trust unitholders of record at the close of business on October 30, 2010. This compares to a distribution of twenty-two cents ($0.22) per Unit for the same period last year.
The sixty-nine cents ($0.69) per Unit increase over the same period last year is attributable to increases in the volume of shipments of iron ore pellets during the most recent quarter and for the year to date, as reported by Northshore Mining Company (“Northshore”), the lessee/operator of the mine on Mesabi Trust lands. The substantial increase in the volume of shipments from Silver Bay, Minnesota resulted in the shipment of additional tons at higher royalty rates, as compared to the same quarter last year, thereby adding to the amount of the base royalty payment. The increase in the volume of shipments from Silver Bay, Minnesota, together with the higher average sales price per ton of iron ore pellets, contributed to the increase in the bonus royalty payment.
Based on the shipments of iron ore reported by Northshore during the third calendar quarter of 2010, Mesabi Trust is expecting to receive a base royalty of $7,955,374 (based on actual shipments of iron ore mined from Mesabi Trust lands of 1,846,770 tons) on October 29, 2010. Mesabi Trust is also expecting to receive a bonus royalty in the amount of $3,978,912 based on the average sales price per ton of iron ore pellets and the volume of shipments during the third calendar quarter of 2010. In addition to the base and bonus royalty payments, Mesabi Trust is also expecting to receive $138,771 as a result of positive pricing adjustments to shipments made during the first and second calendar quarter of 2010. The total royalty payment expected to be received by Mesabi Trust from Northshore is $12,210,188 (including a royalty payment of $143,131 payable to the Mesabi Land Trust).