Help is on the way for Algoma Steel and Canada's other steel plants, federal officials say.
With the steel industry beleaguered by 50 per cent U.S. tariffs, government officials visited Algoma Steel July 16 to lay out a three-pronged approach to protecting jobs and competing in an increasingly volatile global market.
“As we face an increasingly changing landscape in terms of our relationship with the United States, the imposition of tariffs is threatening the steel industry here in Canada,” said Patty Hajdu, the minister of Jobs and Families who is also responsible for FedNor, at a press conference at Algoma Steel.
“We at the federal government know and believe — just as you all do — that if we don't have a strong steel sector in Canada, it is near impossible, if not entirely impossible, to say that we can build Canada strong.”
The Trump administration’s tariffs have dealt a major blow to the steel industry this year, with around 90 per cent of exported Canadian steel in 2024 going to the United States.
In response, Hajdu announced the government is investing $70 million over the next three years to “support Canadian steel workers that are impacted by trade disruptions,” providing upwards of 10,000 people opportunities to further their training or retrain for a different industry in case of a job loss.
“As your industry shifts, as the product shifts, as your supply chain shifts, you may need new skills to remain competitive in this sector,” she said.
“It will also be there in the case of unfortunate job loss, so that people's skills don't go to waste. You can use those skills to build on as you train for employment in another sector.”
Other steel sector supports include providing $1 billion in funding to the Strategic Innovation Fund to help steel companies advance projects, as well as $150 million in funding from the government’s Regional Tariff Response Initiative.
The government’s large enterprise tariff loans will also expand to lower thresholds for qualification and extend loan duration from five to seven years while also reducing the initial interest rate — on the grounds that companies will be required to prioritize keeping workers.
SEE: Canada to target steel originating from China with new tariffs
Hajdu also said the government will take other steps to make Canadian steel more competitive at home.
“We will restrict and reduce foreign steel imports entering the Canadian market, something that the steel industry has been calling for for a very long time,” she said.
“This means that Canadian steel producers will unlock new potentials here at home and create more resilient supply chains within the Canadian market.”
The move will tighten foreign supply to 50 per cent of 2024 import levels — after which a 50 per cent import tariff will apply — and imposing the same 50 per cent tariff on Canada’s non-U.S. free trade partners should their imports exceed 2024 levels.
Finally, the government will also “prioritize Canadian steel to build big projects,” with Hajdu highlighting the “record speed” that the government passed Bill C-5 — the One Canadian Economy: An Act to enact the Free Trade and Labour Mobility in Canada Act and the Building Canada Act.
“It creates a pathway for faster approvals for projects of national interest, for proponents that are provincial, private sector proponents to build things like ports, railways, pipelines, energy corridors, you name it,” she said.
“Those projects are rapidly being conceptualized, and we need Canadian steel for all of them.”
Today's announcement comes shortly after Algoma Steel’s first creation of “green steel” on its new electric arc furnace — something Hajdu said will distinguish the plant as a “world recognized steel producer” as countries look to source low emissions steel.
Algoma Steel CEO Michael Garcia did not mince words about the challenges Algoma Steel faces.
“What can I say? It's a very interesting time to be in the steel industry,” he said.
“On one hand, just behind me last week we produced our first heat of green steel, and that was a momentous and exciting and fantastic day.
"At the same time, we're facing uncertainty around our trade relationship with the U.S., and we're facing a Canadian market that is very difficult for us to compete with, that is overrun by unfairly traded foreign steel.”
Wednesday's announcement helped provide sure footing in a rapidly changing steel market both in Canada and abroad, Garcia said, describing how the government and Algoma Steel worked in tandem to bring the new electric arc furnace to fruition over the past several years.
“When I look at that and I think about what kinds of things can be accomplished when government and industry are aligned, I know that we can meet the current challenges just as well,” he said.
“It's going to take work. It's going to take constant engagement. We aren't there yet, but I think the announcement today is a step in the right direction, and I truly appreciate it.”
