Cleveland-Cliffs reported that Stelco had its most robust third quarter since being acquired by the U.S. firm in 2024. Despite this success, a significant number of employees at the steelmaker’s Ontario facilities in Hamilton and Nanticoke are facing layoffs. CEO Lourenco Goncalves highlighted the positive performance in the Canadian hot-rolled market but emphasized the need for government intervention to address the oversupply of galvanized steel.
Stelco Holdings Inc. announced plans to idle a portion of its Hamilton plant to ensure the company’s viability amid challenges from U.S. tariffs impacting sales. Layoffs are anticipated, with 333 expected in Hamilton and up to 50 at the Lake Erie Works in Nanticoke, according to union officials.
During an earnings call, Goncalves praised President Donald Trump’s trade policies, crediting them for creating favorable conditions for companies like Cleveland-Cliffs to invest and expand domestic production. The CEO noted that steel sales are thriving under the current pricing environment, attributing the success to the Canadian government’s tariff-rate quota system limiting steel imports.
Goncalves reiterated the company’s commitment to maintaining employment levels as agreed upon during the Stelco acquisition. He expressed hope for a trade agreement between Canada and the U.S. to resolve the temporary layoffs. The CEO also signaled readiness to challenge the Canadian government in court to uphold the layoff plan, emphasizing the need for restrictions on galvanized steel imports to rehire workers promptly.
As the situation unfolds, Industry Minister Mélanie Joly stated that legal actions under the Investment Canada Act, such as financial penalties or asset divestiture, are being considered in response to the layoffs. Union representatives criticized the CEO’s messaging, questioning the rationale behind layoffs despite positive financial results and advocating for stricter enforcement of investment commitments.
Overall, the developments at Stelco underscore the complexities of the steel industry amid trade tensions and regulatory challenges, impacting both the company’s performance and the livelihoods of its workforce.
