$500M loan request top of mind as federal minister visits Algoma Steel
By Cory Nordstrom
Published: July 28, 2025
Melanie Joly, the Federal Minister of Innovation, Science, and Industry, visited Sault Ste. Marie on Monday as the company faces huge U.S. tariffs.
Melanie Joly, the Federal Minister of Innovation, Science, and Industry, visited Sault Ste. Marie on Monday for a first-hand look at Algoma Steel’s prized possession – its new electric arc furnace.
Also on the agenda were talks about Algoma’s hopes for a $500 million loan to help it weather 50 per cent tariffs imposed on steel imports by U.S. President Donald Trump.
By Cory Nordstrom
Published: July 28, 2025
Melanie Joly, the Federal Minister of Innovation, Science, and Industry, visited Sault Ste. Marie on Monday as the company faces huge U.S. tariffs.
Melanie Joly, the Federal Minister of Innovation, Science, and Industry, visited Sault Ste. Marie on Monday for a first-hand look at Algoma Steel’s prized possession – its new electric arc furnace.
Also on the agenda were talks about Algoma’s hopes for a $500 million loan to help it weather 50 per cent tariffs imposed on steel imports by U.S. President Donald Trump.
Melanie Joly, the Federal Minister of Innovation, Science, and Industry, visited Sault Ste. Marie on Monday for a first-hand look at Algoma Steels’ prized possession – its new electric arc furnace. (Cory Nordstrom/CTV News)
Last week, CTV News reported that Algoma Steel had submitted the $500-million loan application to the federal government to weather the storm while the trade war rages.
On Monday, Joly and Sault MP Terry Sheehan both said it was on the list of talking points before the minister toured the new electric arc furnace.
“We have started negotiations with the management,” Joly said, who said the talks are “ongoing.”
“(Algoma CEO) Mike Garcia and I … sat down this morning. We had very constructive conversations. And we want to make sure that the steel sector in Canada, which is the crown jewel of our manufacturing sector, is also able to fulfill all the needs of Canadians themselves.”
“Mike Garcia and I … sat down this morning. We had very constructive conversations. And we want to make sure that the steel sector in Canada, which is the crown jewel of our manufacturing sector, is also able to fulfill all the needs of Canadians themselves.”— Melanie Joly, Minister of Innovation, Science, and Industry
“The applications are in -- we had great discussions and we’re looking at different ways to support the steel industry,” Sheehan added.
“I’m confident that in the end that, you know, we will support the steel industry across Canada and the steel industry will not only, you know, be resilient today, but it will grow in the future.”
Last week, CTV News reported that Algoma Steel had submitted the $500-million loan application to the federal government to weather the storm while the trade war rages.
On Monday, Joly and Sault MP Terry Sheehan both said it was on the list of talking points before the minister toured the new electric arc furnace.
“We have started negotiations with the management,” Joly said, who said the talks are “ongoing.”
“(Algoma CEO) Mike Garcia and I … sat down this morning. We had very constructive conversations. And we want to make sure that the steel sector in Canada, which is the crown jewel of our manufacturing sector, is also able to fulfill all the needs of Canadians themselves.”
“Mike Garcia and I … sat down this morning. We had very constructive conversations. And we want to make sure that the steel sector in Canada, which is the crown jewel of our manufacturing sector, is also able to fulfill all the needs of Canadians themselves.”— Melanie Joly, Minister of Innovation, Science, and Industry
“The applications are in -- we had great discussions and we’re looking at different ways to support the steel industry,” Sheehan added.
“I’m confident that in the end that, you know, we will support the steel industry across Canada and the steel industry will not only, you know, be resilient today, but it will grow in the future.”
Melanie Joly, the Federal Minister of Innovation, Science, and Industry, visited Sault Ste. Marie on Monday for a first-hand look at Algoma Steels’ prized possession – its new electric arc furnace. (Cory Nordstrom/CTV News)
Sheehan said that he and his party have been for Algoma Steel in the past when the steelmaker faced major challenges.
“When I was first elected, I was called to a meeting that they were going into bankruptcy,” he said.
“We helped them with that -- we helped them modernize with an investment … We also invested heavily in there in 2018 when Trump first put the tariffs on. We continue to have the industry’s and the Steelworkers’ back. And we continue to today.”
Also on Monday, Joly toured the $800 million electric arc furnace, which fired for the first time earlier this month. She said the plant’s steel production is critical to the work her government has planned.
“This plant will be at the core, meeting the demand for all the new nation-building projects that we will soon be approving,” she said.
Key to defence sector
“This plant is key to our defence sector.”
As part of Bill C-5, Sheehan said the federal government believes the steel produced in the Sault could be used in many more projects than just defence.
“We know for a fact Algoma Steel produces military grade plate, and that is going to be used in shipbuilding programs, submarines,” Sheehan said.
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“It could be armoured vehicles, but there are other applications -- bridges, building beams for housing, even rail.”
In the meantime, times are tough, with U.S. tariffs on steel severely impacting Algoma’s bottom line.
It’s a company that does the majority of its business south of the border.
Cory Nordstrom
CTVNorthernOntario.ca Journalist
Sheehan said that he and his party have been for Algoma Steel in the past when the steelmaker faced major challenges.
“When I was first elected, I was called to a meeting that they were going into bankruptcy,” he said.
“We helped them with that -- we helped them modernize with an investment … We also invested heavily in there in 2018 when Trump first put the tariffs on. We continue to have the industry’s and the Steelworkers’ back. And we continue to today.”
Also on Monday, Joly toured the $800 million electric arc furnace, which fired for the first time earlier this month. She said the plant’s steel production is critical to the work her government has planned.
“This plant will be at the core, meeting the demand for all the new nation-building projects that we will soon be approving,” she said.
Key to defence sector
“This plant is key to our defence sector.”
As part of Bill C-5, Sheehan said the federal government believes the steel produced in the Sault could be used in many more projects than just defence.
“We know for a fact Algoma Steel produces military grade plate, and that is going to be used in shipbuilding programs, submarines,” Sheehan said.
Download the CTV News app nowSign up for breaking news alertsGet daily newsletters with the top local stories emailed to your inbox
“It could be armoured vehicles, but there are other applications -- bridges, building beams for housing, even rail.”
In the meantime, times are tough, with U.S. tariffs on steel severely impacting Algoma’s bottom line.
It’s a company that does the majority of its business south of the border.
Cory Nordstrom
CTVNorthernOntario.ca Journalist
By The Canadian Press
Updated: July 24, 2025
Algoma Steel says it is seeking a large loan from the federal government to ensure its survival in the face of huge tariffs being imposed by the United States.
Algoma Steel Group Inc. is seeking $500 million in federal support as the company faces continued uncertainty from U.S. tariffs on Canadian steel.
The Sault Ste. Marie, Ont.-based steel producer said Thursday that it applied for the funding under the Large Enterprise Tariff Loan program, announced by Ottawa in March to support companies affected by tariffs and countermeasures.
“We are taking a measured and disciplined approach to evaluating the implications of sustained trade barriers,” said chief executive Michael Garcia in a statement.
“We continue to call for timely, prudent policy support to ensure Canadian steelmakers can remain viable contributors to the national interest.”Latest updates on investing here
The company says it remains concerned with the “significant impact” U.S. tariffs are having on its operations and outlook. The U.S. doubled its steel and aluminum tariffs to 50 per cent in June, a level the Canadian Steel Producers Association has said effectively shuts it out of the market.
Last year, Canadian steel producers exported just over half of their production, with over 90 per cent of it going to the U.S.
Algoma says it has enough capital in the near term, but given the uncertainty created by tariffs it is looking at various ways, including government support, to boost its liquidity.
It said the capital boost would help give it room to diversify its customer base as it explores potential investments that align with long-term domestic demand from industries like defence and construction.
The amount of additional financing it could seek will partly depend on the duration and severity of the trade dispute and how much the Canadian steel market “remains exposed to unfairly priced imports,” it said.
The federal government has already moved to reduce steel imports that the industry says are unfairly subsidized, especially from China.
The government imposed 25 per cent tariffs on Chinese steel products last fall, while last week it announced increased protection measures, including 50 per cent tariffs on steel imports above certain thresholds, and a 25 per cent surtax on imports that contain steel that originated in China.
The added supports announced July 16 also included revised terms for the $10 billion Large Enterprise Tariff Loan program to allow targeted support for the steel industry.
Changes include reducing the proposed interest rate, extending the loan maturity, enabling the government to hold equity in companies, as well as requiring companies to prioritize worker retention.
At the time, the Canadian Steel Producers Association welcomed the supports, which also included other financial supports and explicit prioritization of domestic steel in federal projects.
“We appreciate the government’s support as the consequences are devastating from the unjustified trade action by the United States administration,” said chief executive Catherine Cobden in a July 16 statement.
Trade War coverage on BNNBloomberg.ca
Algoma which had about 2,800 employees at the end of last year, bills itself as Canada’s only independent and publicly-owned steelmaker, and says it is the only Canadian producer of steel plate.
The company reported a net loss of $24.5 million last quarter compared with a $28 million profit a year earlier. The company listed lower pricing, linked to a drop in demand because of trade uncertainty, along with higher input costs as major factors in the drop.
The company is almost done a $900 million project to switch to electric arc furnace steelmaking that should slash emissions by 70 per cent. The project was supported by $420 million in federal funding.
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Ian Bickis, The Canadian Press
This report by The Canadian Press was first published July 24, 2025.
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