Cliffs Natural Resources Inc. CLF has selected a location in Toledo, OH, for the development of its first hot briquetted iron (HBI) production plant. The company has selected Midrex Technologies for design, engineering and procurement of necessary equipment for the new facility, which will produce 1.6 million tons of HBI per year.The new production facility is estimated to require roughly $700 million investment and Cliffs is presently in discussions with some financial partners for arranging the necessary funds. The company expects the construction to begin by early 2018, and production of commercial tonnage of HBI is expected to initiate in the middle of 2020.The company has selected the brownfield location at the Port of Toledo because of its relative proximity to several future customers, logistics advantage, availability of affordable gas and also easy access to multiple rail carriers. Cliffs aims to be the sole producer of high-quality HBI for the EAF steel market in the Great Lakes region and this investment marks a strategic milestone for the company. The company expects the new product line to generate strong margin and earnings for the shareholders, moving ahead.Cliffs’ shares fell 26.6% in the last three months, underperforming the Zacks categorized Mining-Iron industry’s decline of 17.2%. For 2017, Cliffs expects to generate roughly $380 million of net income. The company expects its full-year SG&A expenses to be around $100 million of which $25 million is expected to be non-cash expenses. Also, the company's interest expense for 2017 is anticipated to be roughly $175 million, of which $20 million is expected to be non-cash.Cliffs remains focused on de-leveraging its balance sheet and improving its cost structure. Cliffs should also gain from its supply deals with other companies. The ArcelorMittal MT deal enables Cliffs to supply up to 10 million tons of pellets to ArcelorMittal USA. The company also entered into a contract with U.S. Steel Canada to supply pellets. The agreement exceeded the company's original sales expectations. Also, the company is likely to gain from an expected increase in steel demand in the U.S.However, Cliffs remains exposed to a challenging operating environment. The company has also cut its profit guidance for 2017 due to lower expected iron ore pricing. Cliffs now expects net income of roughly $380 million, down from its earlier view of $510 million.Cliffs Natural Resources Inc. Price and Consensus Cliffs Natural Resources Inc. Price and Consensus | Cliffs Natural Resources Inc. QuoteCliffs currently carries a Zacks Rank #3 (Hold).Stocks to ConsiderSome better-ranked companies in the basic materials space include The Sherwin-Williams Company SHW and Potash Corporation of Saskatchewan Inc. POT. Both stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.Sherwin-Williams has expected long-term earnings growth rate of 11.4%.Potash Corporation has expected long-term earnings growth rate of 6.5%.Looking for Stocks with Skyrocketing Upside?Zacks has just released a Special Report on the booming investment opportunities of legal marijuana.Ignited by new referendums and legislation, this industry is expected to blast from an already robust $6.7 billion to $20.2 billion in 2021. Early investors stand to make a killing, but you have to be ready to act and know just where to look. See the pot trades we're targeting>>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Huntsman Corporation (HUN): Free Stock Analysis Report Potash Corporation of Saskatchewan Inc. (POT): Free Stock Analysis Report Cliffs Natural Resources Inc. (CLF): Free Stock Analysis Report Sherwin-Williams Company (The) (SHW): Free Stock Analysis Report ArcelorMittal (MT): Free Stock Analysis Report To read this article on Zacks.com click here. Zacks Investment Research