Cleveland-Cliffs has announced that Stelco had its most robust third quarter performance since being acquired by the U.S.-based company in 2024. Despite this positive development, a significant number of employees at the steelmaker’s facilities in Ontario, specifically in Hamilton and Nanticoke, are facing imminent job losses as layoff notifications began circulating earlier in the month.
Lourenco Goncalves, the CEO of Cleveland-Cliffs, highlighted the exceptional performance of Stelco in the third quarter, citing substantial improvements in the Canadian hot-rolled market. However, Goncalves emphasized the necessity for further action by the Canadian government to address the issue of oversupply in the country’s galvanized steel market.
Stelco Holdings Inc. disclosed its intention to idle a portion of its Hamilton plant on September 28 to safeguard the company’s sustainability amid challenges posed by U.S. tariffs impacting its sales. Ron Wells, president of United Steelworkers Local 1005, predicted approximately 333 job cuts in Hamilton, while John McElroy, president of USW Local 8782, anticipated up to 50 layoffs at the Lake Erie Works in Nanticoke.
During an earnings call, Goncalves applauded the positive performance of Cleveland-Cliffs’s key profit drivers and credited U.S. President Donald Trump’s trade policies for fostering an environment conducive to investments and domestic production growth. Despite Stelco attributing its economic struggles to tariffs, Goncalves expressed optimism about the present steel sales environment, which he described as the most favorable in three years.
Goncalves underscored the pivotal role of the Canadian government’s tariff-rate quota system in the success of the hot-rolled steel business. He reiterated Stelco’s commitment to maintaining the current workforce levels as agreed upon during the company’s acquisition by Cleveland-Cliffs.
Addressing the temporary layoffs, Goncalves mentioned that they were contingent on the resolution of trade negotiations between Canada and the U.S. He stressed the vulnerability of the Canadian market and urged government intervention to curtail the influx of galvanized steel imports, proposing that such action could lead to the reinstatement of the laid-off workers.
Moreover, Goncalves indicated a readiness to engage in legal battles with the Canadian government to uphold the layoff plan if necessary. Meanwhile, Federal Industry Minister Mélanie Joly reiterated the government’s stance on potential legal actions against Cleveland-Cliffs under the Investment Canada Act.
Union representatives expressed concerns about the ongoing layoffs, with Ron Wells stating that the affected workers felt undervalued despite their dedication and loyalty to the company. He criticized the perceived contradiction in Goncalves’s messaging, questioning the decision to shut down certain steel departments despite Stelco’s reported profitability.
Wells also highlighted the call for reduced foreign steel imports, cautioning that Cleveland-Cliffs, as a significant importer to Canada, might exacerbate the existing challenges. He urged Minister Joly to enforce the Investment Canada Act as a means of addressing the situation effectively.