The head of Algoma Steel says that even if Canada reaches a deal with the United States on steel, there’s no going back to the way things were.
Chief executive Michael Garcia, who is set to retire at year-end, says a resolution would help margins but that the company would have to be cautious.
“It wouldn’t mean a return to business as usual,” said Garcia on a conference call Thursday.
“We would be mindful of the strategic risk of just going back to the old business model.”
The federal government had suggested talks with the U.S. were close on trade deals for sectors like steel and aluminum, before U.S. President Donald Trump announced an abrupt halt to negotiations last week.
Garcia said that while tariff relief would help put wind in the company’s sales, it’s focused on reorienting production to domestic demand in areas like defence, infrastructure, energy and manufacturing.
“We still believe in and are committed to being a strategic part of Canada’s nation-building agenda,” he said.
Algoma reported almost half a billion dollars in losses last quarter as the 50 per cent tariffs on steel imposed by the U.S. effectively shut it out of the market.
The $485.1 million net loss came after it took a $503.4 million non-cash impairment charge in the quarter related to tariffs and pressure on the company’s valuation.
Direct tariff expenses totalled $89.7 million.
With access to the U.S. market uncertain, Algoma is focused especially on ramping up steel plate production for the Canadian market.
Big contracts like shipbuilding will help boost that demand, but it will take many projects to fill the gap of the U.S. market, said Garcia, noting that the company could produce all the plate needed for 10 Canadian warships in around two days.
“So it’s not going to be one major program which moves the needle, it’s going to be a lot of demand throughout the entire economy and all types of projects.”
The company has accelerated a shift to more flexible electric arc furnace-based production, and toward plate over steel coil, but the market in general is experiencing weakness from the trade dispute, he said.
To help see the company through its transition to focus more on the domestic market, the Ontario and federal governments have provided $500 million in financing. Export Development Canada has also extended a US$75 million credit facility, to bring its asset-backed revolving credit facility to US$375 million.
The funds will help turn Algoma from a cross-border commodity producer to a Canadian-focused supplier of essential steel products, said Garcia.
“This transformation strengthens both Algoma and Canada’s industrial future,” Garcia said.
This report by The Canadian Press was first published Oct. 30, 2025.
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