Schedules keep getting tighter for Algoma’s order book. A 50 percent U.S. Section 232 tariff on Canadian steel took effect early June, making many exports uneconomic and pushing the mill to focus at home. From June onwards, Algoma booked C$64.1 million in tariff costs on C$589.7 million of revenue, posting a C$110.6 million net loss. These numbers are staggering and that’s before the recent edition of Trump’s latest 10 percent added on top.
CEO Michael Garcia said the quiet part out loud earlier this year that a 50 percent duty “has closed the U.S. market to Canadian steelmakers.” He repeated that message this week, warning there’s no quick re‑entry even if talks thaw. The solution is to build a Canadian sales plan and stop waiting on Washington.
U.S. shipments still made up 54 percent of volume in the first half of 2025, so unwinding those commitments will take months. With offshore options limited, Garcia has bluntly said that practical export markets beyond the U.S. are thin. That means more plate and select coil pointed at domestic buyers, not a romantic Atlantic crossing.
Tariffs Decide The Sales Mix
The tariff spike that doubled to 50 percent on June 4, did more than tax exports. It flooded Canada with displaced foreign tons and undercut prices. Algoma says Canadian spot realizations ran up to 40 percent below U.S. levels in the June quarter, a spread that turns margins into dust.
Ottawa’s new Large Enterprise Tariff Loan program is meant to bridge that gap. The facility launched in April with up to C$10 billion, later easing terms for steel, cutting the revenue threshold to C$150 million, minimum loan size to C$30 million, and stretching maturity to seven years. That is cheap oxygen, but it comes with job‑retention strings.
Algoma applied for C$500 million under the program in July, then secured a C$400 million federal term sheet in September, matched by C$100 million from Ontario. Cash is not a long term strategy, but it buys time to reshape contracts toward defence, construction, and other Canadian projects.
One line indicates the direction of travel: “We require this liquidity support to withstand this unprecedented U.S. governmental action.” The money keeps furnaces running while the sales team rewrites the customer list.
Loans Keep The Furnaces Hot
The electric arc furnace build hit first arc July 10, and the plant is targeting 3.7 million tons of raw steel capacity, with a 70 percent emissions cut versus old blast furnaces. The tech lowers conversion cost, which matters when price is set by someone else’s politics.
For Canadian jobs, the company listed about 2,800 workers at year‑end, the constituency behind the financing and the shift to domestic orders. Ottawa will expect to see those jobs on the floor, not in footnotes.
Leadership is lined up for the next phase. CFO Rajat Marwah takes the CEO chair on January 1, 2026, with Michael Moraca stepping in as CFO the same day. That locks a handover before the next contract cycle, and it ties accountability to the pivot, not the past.
If the tariff wall drops, margins improve, but the company says it won’t sprint back to old patterns. After paying C$64.1 million in one quarter just to cross the border, caution is not a slogan but cash management. Until rules change, Canada is the market and procurement policy is the price sheet.
