Algoma Steel considering alternatives to bolster liquidity amid trade impasse

Algoma Steel (ASTL) Group commented on the ongoing trade impasse and prolonged tariff environment in Canada. The company said,”Algoma acknowledges the ongoing efforts of Canadian government negotiators to secure a fair and durable trade resolution with the United States. While bilateral trade negotiations continue, the Company is concerned with the significant impact the current 50% Section 232 tariff on Canadian steel is having on its operations and outlook. Algoma is Canada’s only independent and publicly owned steelmaker, and the nation’s only producer of steel plate. The Company is near completion of an over C$900M investment in electric arc furnace steelmaking that is expected to lower the Company’s carbon footprint and, absent tariffs, benefit all stakeholders and improve cash flow generation. Algoma has sufficient resources on hand to manage its liquidity over the near term. However, given the ongoing uncertainty caused by the U.S. tariffs resulting in a structural imbalance in the Canadian market, the Company is considering various alternatives to bolster liquidity. Algoma anticipates that such support would be used to support the Company’s continuing operations while exploring diversification of the Company’s customer base to facilitate long-term competitiveness. The amount of additional financing that Algoma will seek will depend, in part, on the duration and severity of the trade dispute and the extent to which the Canadian steel market remains exposed to unfairly priced imports. As part of ongoing constructive engagement with the Government of Canada, Algoma is exploring targeted liquidity tools and funding programs that could support its current operations and enable strategic diversification. This includes an application to the federal Large Enterprise Tariff Loan program for $500M, ongoing discussion of potential terms of LETL support and an evaluation of capital investments that align with long-term domestic demand in sectors such as defense and construction, while reinforcing Canada’s industrial resilience and low-carbon transformation.”