MESABI TRUST
For the period ended Apr 30, 2026. Filed Jun 12, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Apr 30, 2026 · Filed Jun 12, 2026
MSB$17.25+4.6%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-10-31; filed 2025-12-12.
0001104659-25-120673
Item 2. Trustees’ Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-04-30; filed 2026-06-12.
0001104659-26-073470
Item 2. Trustees’ Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 86 previous paragraphs and 75 current paragraphs.
37 unchanged; 29 reworded; 6 added; 17 removed; 3 previous and 3 current paragraphs rearranged.
Tables are not compared: 12 previous and 9 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (6)
Current report
Based on Cliffs’ most recent royalty report dated April 30, 2026 for shipments and deemed shipments during the first quarter ended March 31, 2026, the Trust did not receive any bonus royalty revenue. See “Risk Factors – The limited arms’-length third-party sales of iron ore products (processed at Northshore using Mesabi Trust iron ore) by Cliffs at prices below the annual adjusted bonus royalty threshold price eliminated a bonus royalty during the Trust’s fiscal quarter ended April 30, 2026, could continue toreduce or even eliminate bonus royalties historically paid to the Trust and could result in potential disputes regarding the amount of royalties owed to the Trust,” as set forth in “Part II, Item 1A. Risk Factors on page 18 of this Report.
Current report
As set forth in the table below, Unallocated Reserve decreased from $19,611,719 as of April 30, 2025 to $18,341,533 as of April 30, 2026. The decrease in Unallocated Reserve as of April 30, 2026, as compared to April 30, 2025, is primarily the result of a decrease in accrued income receivable caused by a decrease in prices received on pellets of iron ore which resulted in no bonus royalty revenue accrued for the month of April 2026 as compared to April 2025.
Current report
As noted above, Cliffs Royalty Report indicated the bonus royalty is $0. Cliffs reported that all deemed shipments out of Silver Bay for the calendar quarter ended March 31, 2026 were below the 2026 adjusted bonus royalty threshold of $71.70 per ton. The prices Cliffs reported for deemed shipments in this quarter were based on a third-party sale that occurred in September 2025. Other than the time period related to Cliffs’ temporarily idling of Northshore operations from May 2022 to April 2023, this represents the first time in many years that Cliffs’ quarterly royalty report and royalty payment did not report and pay Mesabi Trust a bonus royalty for shipments of iron ore pellets made during the applicable quarter. Cliffs’ Royalty Report also indicated that royalty calculations are based on estimated prices that are subject to change. All royalties are subject to continued due diligence review and verification by Mesabi Trust.
Current report
Northshore operates Mile Post 7 tailings basin located approximately five miles west of Silver Bay, Minnesota, and three miles from Lake Superior. Originally constructed in the late 1970s, the Mile Post 7 tailings basin receives and impounds fine tailings that are a byproduct of processing taconite ore extracted from the Peter Mitchell Mine. The tailings basin now spans approximately 2,100 acres and is contained by three primary dams—Dams 1, 2, and 5.
Current report
In recent years, Northshore has proposed expanding the Mile Post 7 tailings basin to accommodate increased production and extend the facility's operational lifespan. The proposed 650-acre expansion includes relocating an existing railroad embankment, extending Dams 1 and 2, constructing a rail switchback, and excavating clay from a borrow pit for dam construction. Additionally, the project involves stream mitigation efforts across several sites to address environmental impacts.
Current report
On March 2, 2026, the parties jointly filed a stipulation seeking a stay of the case, reporting that the parties had engaged in settlement discussions and “progressed sufficiently that a stay of [the] matter is appropriate” in order to “allow the parties to focus their attention and energy on resolving terms and finalizing what will likely be a complicated settlement agreement.” On March 3, 2026, the Court referred the case to mediation and issued an order granting a stay of the matter until the Court orders otherwise.
Removed paragraphs (17)
Previous report
As reflected in the table below, the Trust’s total royalty income for the nine months ended October 31, 2025 decreased by $6,456,708 to $13,156,985 as compared to the nine months ended October 31, 2024. The decrease in royalty income is attributable to Northshore being in an extended maintenance shut down in February 2025 along with a decrease in both pricing and shipments of iron ore during the nine months ended October 31, 2025, as compared to the nine months ended October 31, 2024.
Previous report
The table below shows that the base overriding royalties decreased $3,226,781 and the bonus royalties decreased by $3,320,181 for the nine months ended October 31, 2025, as compared to the nine months ended October 31, 2024. Fee royalties increased by $90,254 over the same period. The decrease in the base overriding royalties is attributable to an extended maintenance shut down at Northshore in February 2025 along with a decrease in both pricing and shipments of iron ore during the nine months ended October 31, 2025, as compared to the nine months ended October 31, 2024. The decrease in the bonus royalty is attributable to a decrease in the prices of products shipped over the threshold price per ton which resulted in a lower bonus royalty rate during the nine months ended October 31, 2025 as compared to the nine months ended October 31, 2024. The increase in the fee royalties is attributable to an increase in the royalty rate paid during the nine months ended October 31, 2025, as compared to the nine months ended October 31, 2024.
Previous report
Net income for the three months ended October 31, 2025 was $2,767,463, a decrease of $75,558,062 as compared to the three months ended October 31, 2024. The decrease in net income for the three months ended October 31, 2025 is primarily attributable to the recognition of revenue related to the AAA arbitration award in the prior period and a decrease in royalty income due to a decrease in both pricing and shipments, as well as a reduction in the bonus royalty rate of iron ore during the three months ended October 31, 2025 as compared to the three months ended October 31, 2024. The Trust’s expenses for the three months ended October 31, 2025 were $822,987, an increase of $146,672 compared to the expenses for the three months ended October 31, 2024. The increase in
Previous report
As set forth in the table below, Unallocated Reserve decreased from $95,324,736 as of October 31, 2024 to $21,087,860 as of October 31, 2025. The decrease in Unallocated Reserve as of October 31, 2025, as compared to October 31, 2024, is primarily the result of a decrease in unallocated cash and cash equivalents and a decrease in accrued income receivable. The decrease in the unallocated cash and cash equivalents portion of the Unallocated Reserve is in part attributable to AAA arbitration award being received as of October 31, 2024, which was subsequently distributed to unitholders. The decrease in the accrued income receivable portion of the Unallocated Reserve is attributable to a decrease in pricing, including a lower bonus royalty rate, in the last month of the fiscal quarter ended October 31, 2025 as compared to the prior comparable period.
Previous report
Commencement of Arbitration
Previous report
On September 26, 2025, Mesabi Trust initiated arbitration against Northshore and its parent, Cliffs (Northshore and Cliffs, jointly, the “Operator”), the lessee/operator of the leased lands. Mesabi Trust commenced the arbitration proceeding through the American Arbitration Association. Mesabi Trust seeks damages and declaratory relief relating to the Operator’s idling of Northshore’s operations from May 2022 to April 2023 and underpayment of royalties on intercompany shipments from 2023 through the present.
Previous report
Cleveland-Cliffs Announcement of Replacing Aluminum with Steel in Automotive Stamping Equipment
Previous report
On October 29, 2025,** **Cliffs announced that it successfully completed a production trial in collaboration with a major automotive OEM, in which Cliffs’ exposed steel parts were stamped with no defects using the OEM’s existing aluminum-forming equipment. Cliffs press release indicated that the trial marks a significant milestone in demonstrating that Cliffs steel can effectively replace aluminum in critical automotive applications without the need for costly retooling. Cliffs described this as a major breakthrough in the wake of recent major disruptions, presumably long-lasting, in the aluminum supply chain.
Previous report
According to Cliffs’ press release, this achievement was made possible through Cliffs’ industry-leading technical service and application engineering teams, who worked directly with the OEM’s production and tooling specialists to fine-tune the material design and forming parameters. According to Cliffs, the result was a smooth transition from aluminum to steel, with no changes required to the stamping line.
Previous report
Cliffs also indicated that it has already moved from the trial phase to routine production and delivery of regular orders to the client. Cliffs said it has also received inquiries from other clients for programs that will replace aluminum with Cliffs steel, underscoring the growing confidence among automotive OEM’s in domestic steel and Cliffs’ supply reliability.
Previous report
Cleveland-Cliffs Announcement of Pricing its Underwritten Public Offering
Previous report
On October 30, 2025, Cliffs announced the pricing of its underwritten public offering (the “Offering”) of 75,000,000 common shares, par value $0.125 per share (the “Common Shares”), for expected gross proceeds of $964 million, before discounts and expenses. In addition, Cliffs has also granted the underwriter a 30-day option to purchase up to an additional 11,250,000 Common Shares. The Offering was expected to close on October 31, 2025, subject to the satisfaction of customary closing conditions. Cliffs said it intends to use the net proceeds from the Offering for the repayment of borrowings under its asset-based credit facility, with any remaining net proceeds for general corporate purposes.
Previous report
Cleveland-Cliffs Announcement of POSCO as MOU Strategic Partner
Previous report
On October 30, 2025, Cliffs announced that POSCO, Korea's largest steelmaker and the world's third largest steelmaker outside of China, is its strategic partner under the previously disclosed transformative Memorandum of Understanding. The MoU between the two companies was executed on September 17, 2025. Cliffs reported that with the recent completion of the new U.S. and Korea trade agreement, cooperation between the two nations' industrial sectors will be further reinforced by the POSCO-Cliffs partnership.
Previous report
According to Cliffs’ press release, the partnership will allow POSCO to support and grow its established U.S. customer base while ensuring that its products meet U.S. trade and origin requirements. Cliffs said it expects the ultimate outcome of this MoU to be highly accretive to shareholders.
Previous report
Cliffs’ press release reported that a formal announcement on a definitive agreement is expected in the fourth quarter of 2025 or first quarter in 2026 with closing expected in 2026.
Previous report
On July 29, 2025, WaterLegacy filed a motion for a temporary injunction seeking to enjoin DNR from issuing any further approvals and Northshore from engaging in any construction or development activities related to the proposed project, including any activities to extend dams, relocate railroads, increase dam heights, expand the tailings basin footprint, or increase tailings deposition, pending resolution of the litigation or completion of environmental review. On September 4, 2025, the court issued an order denying the requested temporary injunction. The case is proceeding, and trial is set to occur in September 2027.
Reworded paragraphs (29)
Previous wording
This discussion should be read in conjunction with the condensed financial statements and notes presented in this Quarterly Report on Form 10-Q and the financial statements and notes in the last filed Annual Report on Form 10-K for the year ended January 31, 2025 for a full understanding of Mesabi Trust’s financial position and results of operations for the three and nine months ended October 31, 2025.
Current wording
This discussion should be read in conjunction with the condensed financial statements and notes presented in this Quarterly Report on Form 10-Q and the financial statements and notes in the last filed Annual Report on Form 10-K for the year ended January 31, 2026 for a full understanding of Mesabi Trust’s financial position and results of operations for the three months ended April 30, 2026.
Previous wording
of Peters Lease. Following the outcome of the 2019 arbitration, Cliffs began accruing royalty payments to the Trust for both DR pellets and standard pellets to be sold for internal use at facilities owned by Cliffs or its subsidiaries. This accrual method was upheld in the September 6, 2024 award. As a result, the Trust recognizes revenue for internal use pellets upon production of those pellets, regardless of pellet grade. Pellets produced by Northshore Mining Company (“Northshore” or “NMC”) that are not designated for internal use by Cliffs, or its subsidiaries, and instead are intended for sale to third parties in arms’-length sales, continue to be recognized as revenue upon shipment from Silver Bay, Minnesota.
Current wording
of Peters Lease. Following the outcome of the 2019 arbitration, Cliffs began accruing royalty payments to the Trust for both DR pellets and standard pellets to be sold for internal use at facilities owned by Cliffs or its subsidiaries. This accrual method was upheld in the September 6, 2024 arbitration award. As a result, the Trust recognizes revenue for Cliffs’ internal use pellets upon production of those pellets, regardless of pellet grade. Pellets produced by Northshore Mining Company (“Northshore” or “NMC”) that are not designated for internal use by Cliffs, or its subsidiaries, and instead are intended for sale to third parties in arms’-length sales, continue to be recognized as revenue upon shipment from Silver Bay, Minnesota.
Previous wording
above the Adjusted Threshold Price). Royalty bonuses typically are subject to price adjustments under Cliffs’ customer contracts (to the extent they are utilized) and, as described elsewhere in this report, such adjustments may be positive or negative.
Current wording
above the Adjusted Threshold Price). Royalty bonuses are subject to price adjustments under Cliffs’ customer contracts and, as described elsewhere in this report, such adjustments may be positive or negative.
Previous wording
During the course of its typical fiscal year, historically some portion of royalties expected to be paid to Mesabi Trust would be based in part on estimated prices for certain iron ore products sold under some of the Cliffs’ customer contracts. Generally, Cliffs’ customer contracts have typically used estimated prices which are subject to interim and final pricing adjustments, which can be positive or negative, and are dependent in part on multiple price and inflation index factors that are not known until after the end of a contract year. Even though Mesabi Trust is not a party to the Cliffs’ customer contracts, these adjustments can result in significant variations in royalties payable to Mesabi Trust (and, in turn, the resulting amount available for distribution to Unitholders by the Trust) from quarter to quarter and on a comparative historical basis, and these variations, which can be positive or negative, cannot be predicted by the Trust. In either case, when used in Cliffs’ third party customer contracts, these price adjustments would impact future royalties payable to the Trust and, in turn, would impact cash reserves that may become available for distribution to Unitholders.
Current wording
During the course of its typical fiscal year, some portion of royalties expected to be paid to Mesabi Trust is based in part on estimated prices for certain iron ore products sold under some of the Cliffs’ customer contracts. The Cliffs’ customer contracts use estimated prices which are subject to interim and final pricing adjustments, which can be positive or negative, and are dependent in part on multiple price and inflation index factors that are not known until after the end of a contract year. Even though Mesabi Trust is not a party to the Cliffs’ customer contracts, these adjustments can result in significant variations in royalties payable to Mesabi Trust (and, in turn, the resulting amount available for distribution to Unitholders by the Trust) from quarter to quarter and on a comparative historical basis, and these variations, which can be positive or negative, cannot be predicted by the Trust. In either case, these price adjustments will impact future royalties payable to the Trust and, in turn, will impact cash reserves that may become available for distribution to Unitholders.
Previous wording
As also described elsewhere in this report, the Trust receives a bonus royalty equal to a percentage of the gross proceeds of iron ore products (mined from Mesabi Trust Lands) shipped and sold at prices above the Adjusted Threshold Price. Although 98.3% of all the iron ore products shipped during calendar 2024 was sold at prices higher than the Adjusted Threshold Price, the Trustees are unable to project whether Cliffs will continue to be able to sell iron ore products at prices above the applicable Adjusted Threshold Price, entitling the Trust to any future bonus royalty payments.
Current wording
As also described elsewhere in this report, the Trust receives a bonus royalty equal to a percentage of the gross proceeds of iron ore products (mined from Mesabi Trust Lands) shipped and sold at prices above the Adjusted Threshold Price. Although 95.5% of all the iron ore products shipped during calendar 2025 were sold at prices higher than the Adjusted Threshold Price, the Trustees are unable to project whether Cliffs will continue to be able to sell iron ore products at prices above the applicable Adjusted Threshold Price, entitling the Trust to any future bonus royalty payments.
Previous wording
In order to calculate the royalties owed by Northshore to Mesabi Trust, the 1989 Royalty Agreement requires that Northshore make sales of iron ore products to third parties on an arms’-length basis without regard to any other business relationship between Northshore and the third-party buyer of the iron ore products. In order to calculate royalties on less than arms’-length sales (including sales from Northshore to Cliffs’ corporate affiliates), the Royalty Agreement requires reference to the highest contract price obtained by Northshore in the preceding four calendar quarters in a sale to a buyer not affiliated with Northshore and made on an arms’-length basis. Since Cliffs’ acquisition of ArcelorMittal USA in late-2020, and accelerating after Cliffs’ Toledo HBI plant came online in mid-2021, Northshore has increased the proportion of iron ore mined from the Mesabi Trust Lands that it sells to Cliffs’ corporate affiliates and decreased the proportion of such iron ore that it sells to third parties in arms’-length transactions. Cliffs’ public statements beginning in October 2021 have indicated that Cliffs will be limiting the tonnage of iron ore pellets that it sells to third parties from all of its mines, and particularly Northshore, which Cliffs idled from May 2022 to April 2023. Cliffs also said it will continue to run Northshore as a swing operation. For the twelve-month period ended December 31, 2023, Cliffs has reported to the Trust two low volume shipments of iron ore pellets (produced from iron ore principally mined from Mesabi Trust Lands) to a single third-party customer. Cliffs’ quarterly royalty report used the highest price from those two transactions to set the price for royalty purposes for subsequent shipments intended for Cliffs’ affiliates internal consumption beginning in July 2023. For the twelve-month period ended December 31, 2024, Cliffs has reported to the Trust four low volume shipments of iron ore pellets (produced with iron ore principally mined from Mesabi Trust Lands) to a single third-party customer. Cliffs’ quarterly royalty report used the highest price from certain of those transactions to set the price for royalty purposes for subsequent shipments intended for Cliffs’ affiliates’ internal consumption beginning in July 2024, subject to the newly reported arms’-length third-party customer sales transactions thereafter. According to Cliffs’ quarterly royalty reports, beginning with the third calendar quarter of 2025, the highest contract price obtained by Northshore in the preceding four calendar quarters in a sale to a buyer not affiliated with Northshore and made on an arms’-length basis decreased, resulting in a lower bonus royalty rate for the Trust beginning July 1, 2025. The Trust is continuing to evaluate whether such transactions meet the requirements of the Royalty Agreement. Without consistent arms’-length sales from Northshore to third parties, the calculation of royalties on iron ore Northshore ships to …
Excerpt shortened here; the source contains the full paragraph.
Current wording
As described in this report, in order to calculate the royalties owed by Northshore to Mesabi Trust, the Royalty Agreement requires that Northshore make sales of iron ore products to third parties on an arms’-length basis without regard to any other business relationship between Northshore and the third-party buyer of the iron ore products. In order to calculate royalties on less than arms’-length sales (including sales from Northshore to Cliffs’ corporate affiliates), the Royalty Agreement requires reference to the highest contract price obtained by Northshore in the preceding four calendar quarters in a sale to a buyer not affiliated with Northshore and made on an arms’-length basis. Since Cliffs’ acquisition of ArcelorMittal USA in late-2020, and accelerating after Cliffs’ Toledo HBI plant came online in mid-2021, Northshore has increased the proportion of iron ore mined from the Mesabi Trust Lands that it sells to Cliffs’ corporate affiliates and decreased the proportion of such iron ore that it sells to third parties in arms’-length transactions. Cliffs’ public statements beginning in October 2021 have indicated that Cliffs will be limiting the tonnage of iron ore pellets that it sells to third parties from all of its mines, and particularly Northshore. Cliffs’ recent royalty reports reported three sale transactions of iron ore pellets shipped to a single third-party customer in September and December 2025. As reported by Cliffs, these third-party customer pellet sale transactions were comprised of lower volumes than historically typical shipment volumes. These iron ore pellets shipped to a third party in September and December 2025 are priced below the 2026 Adjusted Threshold Price (which is used in calculating royalty bonuses payable to the Trust under the Royalty Agreement). The Trust did not record any royalty bonus revenue during the quarter ended April 30, 2026. See “Risk Factors – The limited arms’-length third-party sales of iron ore products (processed at Northshore using Mesabi Trust iron ore) by Cliffs at prices below the annual adjusted bonus royalty threshold price eliminated a bonus royalty during the Trust’s fiscal quarter ended April 30, 2026, could continue toreduce or even eliminate bonus royalties historically paid to the Trust and could result in potential disputes regarding the amount of royalties owed to the Trust” as set forth in “Part II, Item 1A. Risk Factors” on page 18 of this Report. The Trust is continuing to evaluate whether such transactions meet the requirements of the royalty agreement. Without consistent arms’-length sales of iron ore pellets from Northshore to third parties, the calculation of royalties on iron ore pellets that Northshore ships to Cliffs’ affiliates could be uncertain under the Royalty Agreement, which could in turn result in potential disputes regarding the amount of royalties owed to the Trust. Historically, Cliffs has not fully responded to the Trust’s inquiries about its planning and ef…
Excerpt shortened here; the source contains the full paragraph.
Previous wording
Comparison of Iron Ore Pellet Production and Shipments for the Three and Nine Months Ended October 31, 2025 and October 31, 2024
Current wording
Comparison of Iron Ore Pellet Production and Shipments for the Three Months Ended April 30, 2026 and April 30, 2025
Previous wording
As shown in the table below, during the nine months ended October 31, 2025, production and shipments of iron ore pellets at Northshore from Mesabi Trust Lands both totaled 2,496,746 tons. By comparison, pellet production and shipments for the comparable period in 2024 were both 3,019,695 tons. The decrease in production and shipments is primarily attributable to Northshore being in an extended maintenance shut down in February 2025. For the nine months ended October 31, 2025, 100% of shipments originated from Trust lands.
Current wording
As shown in the table below, during the three months ended April 30, 2026, production and shipments of iron ore pellets at Northshore from Mesabi Trust Lands both totaled 906,131 tons. By comparison, pellet production and shipments for the comparable period in 2025 were both 637,186 tons. The increase in production and shipments is attributable to Northshore being in an extended maintenance shut down in February 2025. For the three months ended April 30, 2026 and 2025, 100% of shipments originated from Trust lands.
Previous wording
Comparison of Royalty Income for the Three and Nine Months Ended October 31, 2025 and October 31, 2024
Current wording
Comparison of Royalty Income for the Three Months Ended April 30, 2026 and April 30, 2025
Previous wording
As reflected in the table below, the Trust’s total royalty income for the three months ended October 31, 2025 decreased by $3,957,757 to $3,390,609 as compared to the three months ended October 31, 2024. The decrease in total royalty income is attributable to a decrease in both pricing and shipments of iron ore during the three months ended October 31, 2025 as compared to the three months ended October 31, 2024.
Current wording
As reflected in the table below, the Trust’s total royalty income for the three months ended April 30, 2026 decreased by $2,271,661 to $2,077,811 as compared to the three months ended April 30, 2025. The decrease in total royalty income is attributable to a decrease in prices received on pellets of iron ore which resulted in no bonus royalty revenue received during the three months ended April 30, 2026 as compared to the three months ended April 30, 2025.
Previous wording
The table below shows that the base overriding royalties decreased $1,886,191 and the bonus royalties decreased by $2,125,658 for the three months ended October 31, 2025, as compared to the three months ended October 31, 2024. Fee royalties increased by $54,092 over the same period. The decrease in the base overriding royalties is attributable to a decrease in both pricing and shipments of iron ore during the three months ended October 31, 2025 as compared to the three months ended October 31, 2024. The decrease in the bonus royalty is attributable to a decrease in the prices of products shipped over the threshold price per ton which resulted in a lower bonus royalty rate during the three months ended October 31, 2025 as compared to the three months ended October 31, 2024. The increase in the fee royalties is attributable to an increase in the royalty rate paid during the three months ended October 31, 2025 as compared to the three months ended October 31, 2024.
Current wording
by $51,569 over the same period. The decrease in the base overriding royalties and bonus royalties is attributable to a decrease in prices received on pellets of iron ore which resulted in no bonus royalty revenue received during the three months ended April 30, 2026 as compared to the three months ended April 30, 2025. The increase in the fee royalties is attributable to an increase in crude ore mined during the three months ended April 30, 2026 as compared to the three months ended April 30, 2025, due to the extended maintenance shut down at Northshore during the fiscal quarter ended April 30, 2025.
Previous wording
Comparison of Net Income, Expenses and Distributions for the Three and Nine Months Ended October 31, 2025 and October 31, 2024
Current wording
Comparison of Net Income, Expenses and Distributions for the Three Months Ended April 30, 2026 and April 30, 2025
Previous wording
Net income for the nine months ended October 31, 2025 was $11,142,554, a decrease of $76,064,649 as compared to the nine months ended October 31, 2024. The decrease in net income for the nine months ended October 31, 2025 is primarily due to the recognition of revenue related to the AAA arbitration award in the prior period and a decrease in royalty income attributed to an extended maintenance shut down in February 2025 along with a decrease in both pricing and shipments of iron ore and a decrease in the prices of products shipped over the threshold price per ton which resulted in a lower bonus royalty rate during the nine months ended October 31, 2025, as compared to the nine months ended October 31, 2024. The Trust’s expenses for the nine months ended October 31, 2025 were $2,789,193, a decrease of $1,745,926 compared to the expenses for the nine months ended October 31, 2024. The decrease in expenses was primarily attributable to a decrease in legal fees for the nine months ended October 31, 2025 as compared to the prior comparable period during which the Trust was engaged in active arbitration. The table below summarizes the Trust’s income and expenses for the nine months ended October 31, 2025 and October 31, 2024, respectively.
Current wording
Net income for the three months ended April 30, 2026 was $1,087,463, a decrease of $2,543,745 as compared to the three months ended April 30, 2025. The decrease in net income for the three months ended April 30, 2026 is primarily attributable to a decrease in royalty income during the quarter ended April 30, 2026 compared to the same period in the prior year. The decrease in royalty income is due to a decrease in prices received on pellets of iron ore which resulted in no bonus royalty revenue received during the three months ended April 30, 2026. The Trust’s expenses for the three months ended April 30, 2026 were $1,158,425, an increase of $55,091 compared to the expenses for the three months ended April 30, 2025. The increase in expenses was primarily attributable to an increase in legal fees and expenses incurred for the three months ended April 30, 2026 as compared to the prior comparable period. The table below summarizes the Trust’s income and expenses for the three months ended April 30, 2026 and April 30, 2025, respectively.
Previous wording
As presented on the “Trust’s Condensed Statements of Income” on page 3 of this quarterly report, the Trust’s net income per unit decreased $5.7590 per unit to $0.2109 per unit for the fiscal quarter ended October 31, 2025, as compared to the fiscal quarter ended October 31, 2024. On October 10, 2025, the Trust declared a distribution of $0.34 per unit payable on November 20, 2025 to Unitholders of record on October 30, 2025. Comparatively, the Trust declared a distribution of $0.39 per unit during the quarter ended October 31, 2024. During the nine months ended October 31, 2025 and October 31, 2024, the Trust declared distributions totaling $1.02 per unit to Unitholders of record and $0.98, respectively.
Current wording
As presented on the “Trust’s Condensed Statements of Income” on page 3 of this quarterly report, the Trust’s net income per unit decreased $0.1939 per unit to $0.0829 per unit for the fiscal quarter ended April 30, 2026 as compared to the fiscal quarter ended April 30, 2025. On April 14, 2026, the Trust declared a distribution of $0.24 per unit payable on May 20, 2026 to Unitholders of record on April 30, 2026. Comparatively, the Trust declared a distribution of $0.56 per unit during the quarter ended April 30, 2025.
Previous wording
The Trust’s Unallocated Reserve as of October 31, 2025 decreased by $2,239,857 to $21,087,860, as compared to the fiscal year ended January 31, 2025. The decrease in the Unallocated Reserve as of October 31, 2025, as compared to January 31, 2025, is the result of a decrease in unallocated cash and cash equivalents offset by an increase in the accrued income receivable and contract asset. The decrease in the unallocated cash and cash equivalents portion of the Unallocated Reserve is attributable to the extended maintenance shut down at Northshore in February 2025 during which minimal mining, production and shipment occurred. The increase in the accrued income receivable portion of the Unallocated Reserve is attributable to an increase in shipments in the last month of the fiscal quarter ended October 31, 2025 as compared to the last month of the fiscal year ended January 31, 2025. The increase in the contract asset portion of the Unallocated Reserve is attributable to estimates of variable consideration related to the shipments calendar year-to-date through October 31, 2025 as compared to only one month of calendar year-to-date shipments for the fiscal year ended January 31, 2025. See “Note 2” for further discussion of contract asset and contract liability.
Current wording
The Trust’s Unallocated Reserve as of April 30, 2026 decreased by $2,061,339 to $18,341,533, as compared to the fiscal year ended January 31, 2026. The decrease in the Unallocated Reserve as of April 30, 2026, as compared to January 31, 2026, is the result of a decrease in unallocated cash and cash equivalents offset by an increase in the contract asset. The decrease in the unallocated cash and cash equivalents portion of the Unallocated Reserve is attributable to lower royalties received during the quarter ended April 30, 2026 as compared to the quarter ended January 31, 2026. The increase in the contract asset portion of the unallocated reserve is attributed to estimates of variable consideration related to shipment calendar year-to-date April 30, 2026, as compared to only one month of shipments for the quarter ended January 31, 2026. See “Note 2” for further discussion of contract asset and contract liability.
Previous wording
Each quarter, as authorized by the Agreement of Trust, the Trustees will reevaluate all relevant factors including all costs, expenses, obligations, and present and future liabilities of the Trust (whether fixed or contingent) in determining a prudent level of unallocated reserve in light of the unpredictable nature of the iron ore industry, current and projected future mining operations and current economic conditions. Although the actual amount of the Unallocated Reserve will fluctuate from time to time and may increase or decrease from its current level, it is currently anticipated that future distributions will be highly dependent upon royalty income as it is received and the level of Trust expenses. The amount of future royalty income will be a function of the volume of iron ore products produced or shipped and the dollar amount from the sale to third-party customers in bona fide transactions by Northshore that meet the requirements of the royalty agreement. Production and shipping activity is greatly reduced during the winter months. As previously disclosed, on April 25, 2023, Cliffs announced that “higher levels of steel production have led to the partial restart of some operations at … [its] iron ore mining and pelletizing swing facility at Northshore earlier this month.” Cliffs also announced that it “…will continue to treat that facility as our swing operation. And at this time, we still do not expect to operate Northshore in full any time this year.” The Trustees have not been provided with any additional information regarding the anticipated volume of production, stockpiling or shipping of iron ore products at the Northshore operations in Babbitt and Silver Bay, Minnesota. General adverse business and industry economic trends, uncertainties arising from war, terrorist events and other global events, higher or lower customer demand for steel and iron ore, decisions by mine operators regarding curtailments or idling production lines or entire plants, environmental compliance uncertainties, difficulties in obtaining and renewing necessary operating permits, higher imports of steel and iron ore substitutes, processing difficulties and consolidation and restructuring in the domestic steel market may adversely affect the amount and timing of such future shipments and sales. The Trustees will continue to monitor the economic and other circumstances of the Trust to strike a responsible balance between distributions to Unitholders and the need to maintain adequate reserves at a prudent level, given the unpredictable nature of the iron ore and steel industry, the Trust’s dependence on the actions of Cliffs/Northshore, and the fact that the Trust essentially has no other liquid assets.
Current wording
Each quarter, as authorized by the Agreement of Trust, the Trustees will reevaluate all relevant factors including all costs, expenses, obligations, and present and future liabilities of the Trust (whether fixed or contingent) in determining a prudent level of unallocated reserve in light of the unpredictable nature of the iron ore industry, current and projected future mining operations and current economic conditions. Although the actual amount of the Unallocated Reserve will fluctuate from time to time and may increase or decrease from its current level, it is currently anticipated that future distributions will be highly dependent upon royalty income as it is received and the level of Trust expenses. The amount of future royalty income available for distribution will be subject to the volume of iron ore product shipments and the dollar level of sales by Northshore. Shipping activity is greatly reduced during the winter months. As previously disclosed, on April 25, 2023, Cliffs announced that “higher levels of steel production have led to the partial restart of some operations at … [its] iron ore mining and pelletizing swing facility at Northshore earlier this month.” Cliffs also announced that it “…will continue to treat that facility as our swing operation. And at this time, we still do not expect to operate Northshore in full any time this year.” The Trustees have not been provided with any additional information regarding the anticipated volume of production, stockpiling or shipping of iron ore products at the Northshore operations in Babbitt and Silver Bay, Minnesota. General adverse business and industry economic trends, uncertainties arising from war, terrorist events and other global events, higher or lower customer demand for steel and iron ore, decisions by mine operators regarding curtailments or idling production lines or entire plants, environmental compliance uncertainties, difficulties in obtaining and renewing necessary operating permits, higher imports of steel and iron ore substitutes, processing difficulties and consolidation and restructuring in the domestic steel market may adversely affect the amount and timing of such future shipments and sales. The Trustees will continue to monitor the economic and other circumstances of the Trust to strike a responsible balance between distributions to Unitholders and the need to maintain adequate reserves at a prudent level, given the unpredictable nature of the iron ore and steel industry, the Trust’s dependence on the actions of Cliffs/Northshore, and the fact that the Trust essentially has no other liquid assets.
Previous wording
Receipt of Quarterly Royalty Report and Royalty Payment Received
Current wording
Receipt of Quarterly Royalty Report and Royalty Payment from Cliffs
Previous wording
As reported to Mesabi Trust by Cliffs in the Royalty Report, based on shipments of iron ore products by Northshore during the three months ended September 30, 2025, Mesabi Trust was credited with a base royalty of $2,817,500. For the three months ended September 30, 2025, Mesabi Trust was also credited with a bonus royalty in the amount of $973,410. Cliffs reported that no adjustments were made in the third quarter. In addition, a royalty payment of** $214,232 was paid to the Mesabi Land Trust. Accordingly, the total royalty payments received by Mesabi Trust on October 30, 2025 from Cliffs were **$4,005,142.
Current wording
As reported to Mesabi Trust by Cliffs in the Royalty Report, based on shipments of iron ore products by Northshore during the three months ended March 31, 2026, Mesabi Trust was credited with a base royalty of $1,201,501. For the three months ended March 31, 2026, Mesabi Trust was also credited with a bonus royalty in the amount of $0. The royalty payment received by Mesabi Trust also included an increase of $243,986 as a result of positive adjustments related to prior quarters. In
Previous wording
The royalties paid to Mesabi Trust are based on the volume of iron ore pellets and other products produced or shipped during the quarter and the year to date, the pricing of iron ore product sales, and the percentage of iron ore pellet production and shipments from Mesabi Trust lands rather than from non-Mesabi Trust lands. In the third calendar quarter of 2025, Cliffs credited Mesabi Trust with 987,370 tons of iron ore shipped, as compared to 972,154 tons shipped or produced during third calendar quarter of 2024. Cliffs’ Royalty Report reported three sale transactions of iron ore pellets shipped to a single third-party during September 2025, which are subject to continued due diligence review. Cliffs’ Royalty Report also indicated that royalty calculations are based on prices that are subject to change.
Current wording
Royalties paid to Mesabi Trust are based on the volume of iron ore pellets and other products produced or shipped during the quarter and the year to date, the pricing of iron ore product sales, and the percentage of iron ore pellet production and shipments from Mesabi Trust lands rather than from non-Mesabi Trust lands. In the first calendar quarter of 2026, Cliffs credited Mesabi Trust with 938,572 tons of iron ore shipped, as compared to 457,728 tons shipped during the first calendar quarter of 2025. Cliffs’ Royalty Report reflected no additional third-party sale transactions of iron ore pellets since reporting several low volume shipments of iron ore pellets to a single Cliffs’ third-party customer in September and December 2025.
Previous wording
Trust’s Prior Announcement of a Thirty-Four Cents Distribution
Current wording
Mesabi Trust’s Prior Announcement of a Twenty-Four Cents Distribution
Previous wording
On October 10, 2025, Mesabi Trust issued a press release announcing that the Trustees of Mesabi Trust declared a distribution of thirty-four cents ($0.34) per Unit of Beneficial Interest payable on November 20, 2025 to Mesabi Trust Unitholders of record at the close of business on October 30, 2025. This compares to a thirty-nine cent ($0.39) per Unit distribution declared for the same period last year.
Current wording
On April 14, 2026, Mesabi Trust issued a press release announcing that the Trustees of Mesabi Trust declared a distribution of twenty-four cents ($0.24) per Unit of Beneficial Interest payable on May 20, 2026 to Mesabi Trust Unitholders of record at the close of business on April 30, 2026. This compares to a fifty-six cents ($0.56) per Unit distribution declared for the same period last year.
Previous wording
On March 1, 2024, the Minnesota Department of Natural Resources (“DNR”) issued an order concluding that Northshore’s proposed project relating to the Milepost 7 tailings basin does not require an environmental impact statement (“EIS”) to proceed. On February 3, 2025, the Minnesota Court of Appeals reversed the DNR’s decision that an EIS was not needed, concluding it was “arbitrary and capricious” and in error. The Court remanded the case to the DNR for a new determination of whether the cumulative potential environmental impact of both the proposed project and the ongoing and future effects of the Milepost 7 tailings basin requires an EIS for the proposed project.
Current wording
On March 1, 2024, the Minnesota Department of Natural Resources (“DNR”) issued an order concluding that Northshore’s proposed project relating to the Mile Post 7 tailings basin does not require an environmental impact statement (“EIS”) to proceed. On February 3, 2025, the Minnesota Court of Appeals reversed the DNR’s decision that an EIS was not needed, concluding it was “arbitrary and capricious” and in error. The Court remanded the case to the DNR for a new determination of whether the cumulative potential environmental impact of both the proposed project and the ongoing and future effects of the Mile Post 7 tailings basin requires an EIS for the proposed project.
Previous wording
On March 5, 2025, both the DNR and Northshore petitioned the Minnesota Supreme Court to review the Court of Appeals’ decision. On May 13, 2025, the Minnesota Supreme Court denied Cliffs’ and the DNR’s petitions for review, thereby leaving in place the Court of Appeals’ reversal decision and remand back to the DNR.
Current wording
On March 5, 2025, both the DNR and Northshore petitioned the Minnesota Supreme Court to review the Court of Appeals’ decision. On May 13, 2025, the Minnesota Supreme Court denied Northshore and the DNR’s petitions for review, thereby leaving in place the Court of Appeals’ reversal decision and remand back to the DNR.
Previous wording
On June 16, 2025, WaterLegacy filed a civil complaint in the Second Judicial District, Ramsey County, Minnesota, Case No. 62-cv-25-4810, seeking injunctive and declaratory relief against the DNR and Northshore in relation to the proposed Milepost 7 tailings basin project. WaterLegacy seeks declaratory and injunctive relief under the Minnesota Environmental Policy Act (“MEPA”) and the Minnesota Environmental Rights Act (“MERA”). WaterLegacy specifically asks the court to (1) declare that any DNR approvals or Northshore construction activities related to the proposed project prior to completion of an EIS are prohibited under MEPA and (2) enjoin these approvals and activities until the EIS process is complete. WaterLegacy also asks the court to (1) declare that the proposed project’s dam enlargement violates or is likely to violate Minnesota dam permitting standards and rules and (2)enjoin the DNR and Northshore from proceeding with the proposed project until a new dam permit is issued in compliance with Minnesota statutes and rules.
Current wording
On June 16, 2025, WaterLegacy filed a civil complaint in the Second Judicial District, Ramsey County, Minnesota, Case No. 62-cv-25-4810, seeking injunctive and declaratory relief against the DNR and Northshore in relation to the proposed Mile Post 7 tailings basin project. WaterLegacy seeks declaratory and injunctive relief under the Minnesota Environmental Policy Act (“MEPA”) and the Minnesota Environmental Rights Act (“MERA”). WaterLegacy specifically asks the court to (1) declare that any DNR approvals or Northshore construction activities related to the proposed project prior to completion of an EIS are prohibited under MEPA and (2) enjoin these approvals and activities until the EIS process is complete. WaterLegacy also asks the court to (1) declare that the proposed project’s dam enlargement violates or is likely to violate Minnesota dam permitting standards and rules and (2) enjoin the DNR and Northshore from proceeding with the proposed project until a new dam permit is issued in compliance with Minnesota statutes and rules. Trial was scheduled to occur in September 2027.
Previous wording
The Trustees are unable to predict what impact, if any, the WaterLegacy lawsuit will have on mining, production and shipments of iron ore products from Northshore or future royalties payable to the Trust.
Current wording
The Trustees are unable to predict what impact, if any, the WaterLegacy lawsuit, or any settlement thereof, will have on mining, production and shipments of iron ore products from Northshore or future royalties payable to the Trust.
Previous wording
Neither Mesabi Trust nor the Trustees have any control over the operations and activities of Northshore, except within the framework of the Royalty Agreement. Cliffs alone controls (i) historical operating data, including iron ore production volumes, decisions to reduce or idle the Northshore plant and mining operations, marketing of iron ore products, operating and capital expenditures as they relate to Northshore, environmental and other liabilities and the effects of regulatory changes; (ii) plans for Northshore’s future operating and capital expenditures; (iii) geological data relating to ore reserves; (iv) projected production of iron ore products; (v) contracts between Cliffs and Northshore with their customers; and (vi) the decision to mine off Mesabi Trust and/or state lands, based on Cliffs’ current mining and engineering plan. The Trustees do not exert any influence over mining operational decisions at Northshore, nor do the Trustees provide any input regarding the ore reserve estimated at Northshore as reported by Cliffs. While the Trustees request relevant information from Cliffs and Northshore in accordance with the Royalty Agreement for use in periodic reports as part of their evaluation of Mesabi Trust’s disclosure controls and procedures, the Trustees do not control this information and they rely on the information in Cliffs’ periodic and current filings with the SEC, as well as information from Northshore, to provide accurate and timely information in Mesabi Trust’s reports filed with the SEC.
Current wording
Neither Mesabi Trust nor the Trustees have any control over the operations and activities of Northshore, except within the framework of the Amended Assignment of Peters Lease, and the framework of the Peters Lease (by virtue of Mesabi Land Trust’s interest in that Lease). Cliffs alone controls (i) historical operating data, including iron ore production volumes, decisions to reduce or idle the Northshore plant and mining operations, marketing of iron ore products, operating and capital expenditures as they relate to Northshore, environmental and other liabilities and the effects of regulatory changes; (ii) plans for Northshore’s future operating and capital expenditures; (iii) geological data relating to ore reserves; (iv) projected production of iron ore products; (v) contracts between Cliffs and Northshore with their customers; and (vi) the decision to mine off Mesabi Trust and/or state lands, based on Cliffs’ current mining and engineering plan. The Trustees do not exert any influence over mining operational decisions at Northshore, nor do the Trustees provide any input regarding the ore reserve estimates at Northshore as reported by Cliffs. While the Trustees request relevant information from Cliffs and Northshore in accordance with the Royalty Agreement for use in periodic reports as part of their evaluation of Mesabi Trust’s disclosure controls and procedures, the Trustees do not control this information and they rely on the information in Cliffs’ periodic and current filings with the SEC to provide accurate and timely information in Mesabi Trust’s reports filed with the SEC.
Previous wording
In accordance with the Agreement of Trust, the Trustees are entitled to, and in fact do, rely upon certain experts in good faith, including (i) independent consultants with respect to monthly production and shipment reports, which include figures on crude ore production and iron ore pellet shipments, and discussions concerning the condition and accuracy of the scales and plans regarding the development of Mesabi Trust’s mining property; and (ii) the accounting firm they have contracted with for non-audit services, including reviews of financial data related to shipping and sales reports provided by Northshore and a review of the schedule of leasehold royalties payable to Mesabi Trust.
Current wording
In accordance with the Agreement of Trust and the Amendment, the Trustees are entitled to, and in fact do, rely upon certain experts in good faith, including (i) the independent consultants they have contracted with, with respect to monthly production and shipment reports, which include figures on crude ore production and iron ore pellet shipments, and discussions concerning the condition and accuracy of the scales and plans regarding the development of Mesabi Trust’s mining property; and (ii) the accounting
Previous wording
For a discussion of additional factors, including but not limited to those that could adversely affect Mesabi Trust’s actual results and performance, see “Risk Factors” set forth on pages 4 through 19 of Mesabi Trust’s Annual Report on Form 10-K for the fiscal year-ended January 31, 2025 (filed April 24, 2025).
Current wording
For a discussion of additional factors, including but not limited to those that could adversely affect Mesabi Trust’s actual results and performance, see “Risk Factors” set forth on pages 4 through 18 of Mesabi Trust’s Annual Report on Form 10-K for the fiscal year-ended January 31, 2026 (filed April 22, 2026), as supplemented by the “Risk Factors” set forth on page 18 of this Quarterly Report on Form 10-Q (Part II, Item 1A.) for the quarter ended April 30, 2026.
Previous wording
The Trust is not taxable as a corporation for federal or state income tax purposes and is instead qualified as a nontaxable grantor trust. Since the Trust’s inception, all net taxable income is annually attributable directly to Unitholders for tax purposes regardless of whether the income is distributed or retained by the Trust in its reserve account. As such, in lieu of the Trust paying income taxes, Unitholders report their pro rata share of the various items of Trust income and deductions on their income tax returns. This reporting is required whether or not the earnings of the Trust are distributed as to Unitholders. During calendar year 2024, any funds retained to increase the Trust’s unallocated reserve, which were derived from reportable royalty income and other proceeds, will nonetheless become taxable as reportable income to Unitholders, depending on each individual’s personal tax situation. Information regarding the background on the changes in the Trust’s unallocated reserve is described above under “Results of Operations — Comparison of Unallocated Reserve as of October 31, 2025, October 31, 2024 and January 31, 2025” beginning on page 14. Unitholders are encouraged to consult with their own tax advisors to plan for any financial impact related to this and to review their personal tax situations related to investing in, holding or selling units of beneficial interest in Mesabi Trust.
Current wording
The Trust is not taxable as a corporation for federal or state income tax purposes and is instead qualified as a nontaxable grantor trust. Since the Trust’s inception, all net taxable income is annually attributable directly to Unitholders for tax purposes regardless of whether the income is distributed or retained by the Trust in its reserve account. As such, in lieu of the Trust paying income taxes, Unitholders report their pro rata share of the various items of Trust income and deductions on their income tax returns. This reporting is required whether or not the earnings of the Trust are distributed to Unitholders. During calendar year 2026, any funds retained to increase the Trust’s unallocated reserve, which were derived from reportable royalty income and other proceeds, will nonetheless become taxable as reportable income to Unitholders, depending on each individual’s personal tax situation. Information regarding the background on the changes in the Trust’s unallocated reserve is described above under “Results of Operations — Comparison of Unallocated Reserve as of April 30, 2026, April 30, 2025 and January 31, 2026” beginning on page 12. Unitholders are encouraged to consult with their own tax advisors to plan for any financial impact related to this and to review their personal tax situations related to investing in, holding or selling units of beneficial interest in Mesabi Trust.
Rearranged current paragraphs (3)
Current report — wording carried from elsewhere
The table below shows that the base overriding royalties decreased $539,395 and the bonus royalties decreased by $1,783,835 for the three months ended April 30, 2026, as compared to the three months ended April 30, 2025. Fee royalties increased
Current report — wording carried from elsewhere
addition, a royalty payment of $179,813 was paid to the Mesabi Land Trust. Accordingly, the total royalty payments received by Mesabi Trust on April 30, 2026 from Cliffs were $1,625,300.
Current report — wording carried from elsewhere
firm they have contracted with for non-audit services, including reviews of financial data related to shipping and sales reports provided by Northshore and a review of the schedule of leasehold royalties payable to Mesabi Trust.
Rearranged previous paragraphs (3)
Previous report — wording carried elsewhere
As shown in the table below, during the three months ended October 31, 2025, production and shipments of iron ore pellets at Northshore from Mesabi Trust Lands both totaled 915,605 tons. By comparison, pellet production and shipments for the comparable period in 2024 were both 1,066,665 tons. The decrease in production and shipments is attributable to lower demand from Northshore’s customers as compared to the prior comparable period. For the three months ended October 31, 2025, 100% of shipments originated from Trust lands.
Previous report — wording carried elsewhere
The table below summarizes the components of Mesabi Trust’s total royalty income for the nine months ended October 31, 2025 and October 31, 2024, respectively:
Previous report — wording carried elsewhere
expenses was primarily attributable to an increase in legal fees for the three months ended October 31, 2025, as compared to the prior comparable period. The table below summarizes the Trust’s income and expenses for the three months ended October 31, 2025 and October 31, 2024, respectively.