Cleveland-Cliffs has reported that Stelco’s performance in the third quarter of this year was the most robust since the U.S. company acquired it in 2024. Despite this positive development, a significant number of employees at the steel manufacturer in Ontario are facing job cuts in Hamilton and Nanticoke. The layoff process began earlier this month and is ongoing.
Lourenco Goncalves, CEO of Cleveland-Cliffs, stated on Monday that the third quarter marked Stelco’s strongest performance since the company’s acquisition two years ago. He highlighted the notable improvement in the Canadian hot-rolled market. However, Goncalves emphasized the need for further action by the Canadian government to address the oversupply issue in the galvanized steel market.
Stelco Holdings Inc. announced on September 28 its intention to temporarily halt operations at part of its Hamilton facility to safeguard the company’s sustainability amid challenges posed by U.S. tariffs affecting its sales. According to Ron Wells, president of United Steelworkers Local 1005, approximately 333 job cuts are anticipated in Hamilton, while John McElroy, president of USW Local 8782, mentioned an expected reduction of up to 50 positions at the Lake Erie Works in Nanticoke.
During an earnings call, Goncalves expressed satisfaction that all major revenue streams of Cleveland-Cliffs had shown growth. He commended the trade policies of U.S. President Donald Trump, asserting that they are conducive to supporting investments in local communities and expanding domestic production, despite Stelco attributing economic challenges to tariffs.
The current steel market is experiencing the most favorable pricing environment in three years, Goncalves noted. He attributed the success of the hot-rolled steel business to the Canadian government’s tariff-rate quota system, which limits imported product volumes.
Goncalves reaffirmed Stelco’s position that the layoffs are temporary until trade negotiations between Canada and the U.S. yield an agreement. He stressed the need for government intervention to restrict the influx of galvanized steel imports to enable Stelco to rehire laid-off employees promptly.
Meanwhile, discussions are ongoing between Ottawa and Cleveland-Cliffs regarding potential legal actions under the Investment Canada Act. Federal Industry Minister Mélanie Joly has emphasized the importance of upholding commitments made during Cleveland-Cliffs’ acquisition of Stelco.
Union representatives have criticized the messaging from the CEO, citing confusion among workers and questioning the shutdown of certain steel departments despite reported profitability. Workers expressed feelings of being undervalued, with concerns raised about the impact of foreign imports on the industry. The union remains hopeful that Minister Joly will enforce the provisions of the Investment Canada Act as promised.