Cleveland-Cliffs has reported that Stelco had its most robust third quarter performance since being acquired by the U.S. company in 2024. Despite this positive news, a significant number of employees at Stelco’s operations in Ontario are facing job cuts in Hamilton and Nanticoke. The layoff process began earlier this month and is ongoing.
Commenting on Stelco’s performance, Cleveland-Cliffs CEO Lourenco Goncalves emphasized the strength of the Canadian hot-rolled market, stating that more improvement is needed in the oversupplied galvanized steel market in Canada. Stelco Holdings Inc. announced plans to idle part of its Hamilton plant to secure the company’s survival amid challenges from U.S. tariffs affecting its sales.
Union representatives revealed that 333 layoffs are anticipated in Hamilton, with up to 50 more expected at the Lake Erie Works in Nanticoke. During an earnings call, Goncalves highlighted the growth in Cleveland-Cliffs’s major profit drivers and commended U.S. President Donald Trump’s trade policies for fostering conditions conducive to company investments and domestic production expansion.
Goncalves attributed the success of the hot-rolled steel business to Canada’s tariff-rate quota system, limiting steel imports. He expressed concerns about the Canadian market’s vulnerability and called for government intervention to restrict the importation of galvanized steel, which could facilitate the rehiring of laid-off workers at Stelco.
In response to the layoffs, Federal Industry Minister Mélanie Joly emphasized Cleveland-Cliffs’s commitment to maintaining employment levels as agreed upon during the Stelco acquisition. Joly indicated that legal actions under the Investment Canada Act, including financial penalties or asset sale requirements, are being considered to ensure compliance.
Union representatives criticized Goncalves’s messaging, expressing dismay at the layoffs despite positive quarterly results. They highlighted the dedication of workers and called for clarity on the company’s decisions regarding department closures. They also urged Minister Joly to uphold commitments under the Investment Canada Act.
The situation at Stelco reflects a complex interplay of market forces, government regulations, and corporate decisions, highlighting the challenges faced by workers and stakeholders in the steel industry.
Image: Stelco steel works in Hamilton are pictured on Oct. 9. The U.S.-based steelmaker announced 300 to 350 layoffs amid the Canada-U.S. trade war. (Evan Mitsui/CBC)