Algoma speeds up EAF transition, shifts focus to supplying mostly plate to Canadian market

The loans are part of a larger government initiative aimed at supporting Canada’s struggling steel industry. The sector is working to regain its footing in a tough trade environment that has been trampled by an unfriendly Trump regime.

“The ongoing imposition of a 50% tariff on Canadian steel has closed the U.S. market to Canadian steelmakers,” said Algoma CEO Michael Garcia, making the governmental support necessary “to withstand this unprecedented U.S. governmental action.”

Speeding up shift to EAF steelmaking

Garcia said the loans will allow the company to accelerate its transformation from blast furnace to electric-arc furnace steelmaking.

Since the 50% Section 232 steel tariffs have effectively closed the US market to Canadian steel, Algoma’s entire cross-border business model has been undermined. Last week, it told SMU it was evaluating its options.

On Monday, the company said the situation has made the continued operation of its blast furnace and coke ovens unsustainable.

“Accordingly, Algoma will begin to exit these primary operations as it accelerates its transition to electric arc furnace (“EAF”) steelmaking,” it stated.

Algoma has two blast furnaces. The No. 6 furnace has been idled for some time now. The remaining No. 7 furnace has a daily ironmaking capacity of 8,400 short tons, which is equivalent to ~3 million st per year, according to SMU’s Blast Furnace Status Table. Once the company completely transitions to using its two new EAFs, which have a combined annual raw steelmaking capacity of ~3.7 million st, the two blast furnaces will be demolished.

The company said it will now focus on as-rolled and heat-treated plate products, as well as “select coil products.” Supporting Canada’s infrastructure, manufacturing, defense, and nation-building initiatives, these products should provide reliable domestic demand.

Last year, Algoma completed a CA$135-million plate mill modernization project, which boosted its annual shipped plate capacity from 450,000 st to 650,000 st. It is the only discrete plate and heat-treat facility in Canada.

Garcia added, “We look forward to supplying Canadian steel – from right here in Sault Ste. Marie – to, as the prime minister has said, help protect our sovereignty, grow our industries, export our energy, and build one strong Canadian economy.”

Algoma Steel did not respond to SMU’s requests for further information.