Steel Mills
Algoma Swings to Loss in Q3, Upbeat About '23 on Higher Prices
February 14, 2023
Algoma Steel said lower production volumes and steel selling prices, as well as the jump in the price of key inputs, hit its fiscal Q3 earnings as the company swung to a loss.
The Sault Ste. Marie, Ontario-based steelmaker posted a net loss of Canadian $69.8 million ($52.3 million USD) in its 3Q ended Dec. 31 vs. net income of C$123.0 million a year earlier on revenue that slid 47% to C$567.8 million.
Specifically, the company cited the higher prices of metallurgical coke, natural gas, alloys, and scrap compared with the previous year.
Algoma reported steel shipments of 458,341 tons in its 3Q, down 17% from 552,544 tons in the same quarter a year earlier. The company blamed the decrease in shipments on a previously disclosed plate mill modernization commissioning and additional maintenance delays.
Commenting on the loss, CEO Michael Garcia said he’s been disappointed by production and shipment levels in the last two quarters.
“As such, my management team and I have been laser-focused on rectifying these shortfalls,” he said in a statement. “We believe the challenges experienced over the prior quarters are now largely behind us, and our facilities are returning to normal production levels.”
Garcia said, as reported at SMU’s Tampa Steel Conference, that Algoma’s transition from integrated to electric-arc furnace (EAF) steelmaking remains “on time and on budget.”
For the C$700-million project, a cumulative total of approximately C$220 million has been spent as of Dec. 31. EAF startup is expected to occur in mid-2024, the company said.
The EAF steelmaking facility is designed to have an annual raw steel production capacity of approximately 3.7 million tons, which matches its downstream finishing capacity, Algoma said.
Garcia noted that some bright spots are the recent rebound in North American hot-rolled coil steel prices and strong plate pricing.
“We expect calendar 2023 to be more in line with our historical production levels,” Garcia said. “Our transformation to electric-arc steelmaking is progressing as expected and we will maintain our relentless focus on creating long-term value for all of our stakeholders.”
By Ethan Bernard, ethan@steelmarketupdate.com
Latest in Steel Mills

USW seeks clarity on plans for Granite City Works
The United Steelworkers union has asked U.S. Steel to elaborate on its Granite City Works plans following reports that the steelmaker is ending processing at the facility.

Nucor maintains plate prices, opens October order book
Nucor aims to keep plate prices flat for a seventh straight month with the opening of its October order book.

ArcelorMittal Mexico to import from sister mills as it works to resume DRI production
ArcelorMittal has partially restarted operations at its direct reduction plant in Lazaro Cardenas, Michoacan. An explosion on Aug. 18 rocked the massive steelworks on Mexico’s Pacific coast, impacting production of direct-reduced iron (DRI).

Fall maintenance outages are coming in hot
Labor Day has passed, the sun is starting to set a little earlier each day, and cooler weather has begun to find its way down to many of us across North America. And you know what that means for the steel industry… Fall maintenance outages!

AISI: Domestic steel production ticks up
US raw steel production ticked up in the week ending on Sept. 6 after a decrease the week before, according to the most recent data from the American Iron and Steel Institute (AISI).