The CEO of the parent company of Stelco in the U.S. asserts his legal right to halt production at a steel mill in Hamilton, leading to around 500 job cuts, citing the ongoing trade dispute between Canada and the U.S.
This statement comes after Prime Minister Mark Carney mentioned that Ottawa will utilize all available powers against Cleveland-Cliffs, pursuing legal action against the Ohio-based company to the fullest extent.
In an interview with CBC News, Cleveland-Cliffs CEO Lourenco Goncalves explained that Stelco’s ability to freely sell steel produced in Hamilton to U.S. buyers was a key condition agreed upon during the company’s acquisition in 2024. This condition included maintaining substantial employment levels in Canada and significant operations in Hamilton, under the Canada-U.S.-Mexico Agreement (CUSMA) that was in effect at the time of the purchase.
Goncalves emphasized that the ability to sell steel into the U.S. market was crucial for him to acquire Stelco, expressing regret over the hostile trade relations between Canada and the U.S. post-acquisition.
Despite the ongoing trade war, CUSMA remains valid until 2036, despite the U.S. halting discussions for a renewal in July.
Goncalves defended his actions as a responsible business owner, stating that he would address Carney’s concerns in court once a lawsuit is filed against him.
The decision to lay off up to 500 employees at Stelco was directly attributed to the trade tensions between the U.S. and Canada, prompted by President Trump’s imposition of significant tariffs on foreign steel imports under Section 232 of the Trade Expansion Act.
Goncalves clarified that the influx of foreign steel imports into Canada has impacted the market for Stelco’s cold-rolled steel production, leading the company to focus on hot-rolled products due to market pressures.
While there were claims of Stelco turning down orders, Goncalves stated that there were no orders to refuse, emphasizing the challenging market conditions.
Goncalves reiterated that the core issue for Stelco is the uncertainty in Canada-U.S. trade rather than financial constraints, stating that money alone could not resolve the ongoing challenges.