Cleveland-Cliffs has reported that Stelco’s performance in the third quarter of this year was the best since its acquisition by the U.S. company in 2024. Despite this success, a significant number of employees at Stelco’s facilities in Hamilton and Nanticoke, Ontario, are facing imminent job losses due to ongoing layoff notices.
According to Cleveland-Cliffs CEO Lourenco Goncalves, the third quarter marked a notable improvement in the Canadian hot-rolled market since the acquisition. However, Goncalves emphasized the necessity for additional actions by the Canadian government to address the oversupply of galvanized steel in the country.
Stelco Holdings Inc. announced plans in late September to temporarily idle a portion of its Hamilton plant to secure the company’s viability amid challenges posed by U.S. tariffs impacting sales. The president of United Steelworkers Local 1005, Ron Wells, disclosed that around 333 layoffs are anticipated in Hamilton, while John McElroy, president of USW Local 8782, indicated up to 50 job cuts at the Lake Erie Works in Nanticoke.
During a recent earnings call, Goncalves highlighted the growth of Cleveland-Cliffs’s major profit drivers and expressed support for U.S. President Donald Trump’s trade policies, which he believes are conducive to fostering local investments and expanding domestic production, despite Stelco attributing economic hardships to tariffs.
Goncalves credited the success of the hot-rolled steel sector to Canada’s tariff-rate quota framework, which restricts the volume of imported products. The federal government has underscored Cleveland-Cliffs’s commitment to maintaining employment levels as stipulated during the acquisition, urging adherence to these obligations amid current challenges.
Goncalves conveyed that the layoffs are temporary measures pending a resolution in Canada-U.S. trade negotiations. He urged the government to restrict galvanized steel imports to enable the rehiring of laid-off workers promptly. Additionally, Goncalves expressed readiness to sell Stelco and confront legal challenges from the Canadian government to safeguard the layoff plan.
Minister Mélanie Joly stated that Ottawa is exploring legal actions under the Investment Canada Act’s Section 40 against Cleveland-Cliffs. Potential measures include financial penalties, court mandates for compliance with commitments, or a directive to divest Canadian assets.
United Steelworkers representatives have criticized the layoff situation, citing worker discontent and confusion over the company’s profitability amid department closures. They have urged Minister Joly to enforce the Investment Canada Act and address the challenges faced by affected employees.
