Algoma Steel Comments on Ongoing Trade Impasse and Prolonged Tariff Environment
Rhea-AI Summary
Algoma Steel (NASDAQ: ASTL), Canada's only independent and publicly owned steelmaker, has addressed concerns regarding the ongoing trade dispute with the United States and its impact on operations. The company faces significant challenges due to a 50% Section 232 tariff on Canadian steel, despite nearing completion of a C$900 million investment in electric arc furnace steelmaking.
To address liquidity concerns, Algoma is pursuing various alternatives, including an application for a $500 million federal Large Enterprise Tariff Loan (LETL). The company aims to support current operations while exploring strategic diversification into sectors such as defense and construction. While Algoma maintains sufficient near-term liquidity, it seeks additional support to manage the structural imbalance in the Canadian market caused by U.S. tariffs.
[ "Near completion of C$900 million investment in eco-friendly electric arc furnace technology", "Currently maintains sufficient resources for near-term liquidity", "Potential access to $500 million federal LETL program support", "Strategic opportunities for diversification into defense and construction sectors" ]Positive
- None.
Negative
- Facing significant impact from 50% Section 232 tariff on Canadian steel
- Structural imbalance in Canadian market due to trade dispute
- Need for additional financing due to trade uncertainty
- Exposure to unfairly priced imports affecting market position
News Market Reaction 36 Alerts
On the day this news was published, ASTL declined 11.15%, reflecting a significant negative market reaction. Argus tracked a trough of -6.1% from its starting point during tracking. Our momentum scanner triggered 36 alerts that day, indicating elevated trading interest and price volatility. This price movement removed approximately $84M from the company's valuation, bringing the market cap to $667M at that time. Trading volume was above average at 1.8x the daily average, suggesting increased trading activity.
Data tracked by StockTitan Argus on the day of publication.
SAULT STE. MARIE, Ontario, July 24, 2025 (GLOBE NEWSWIRE) -- Algoma Steel Group Inc. (NASDAQ: ASTL; TSX: ASTL) (“Algoma” or “the Company”), a leading Canadian producer of hot and cold rolled steel sheet and plate products, today commented on the ongoing trade impasse and prolonged tariff environment in Canada.
Algoma acknowledges the ongoing efforts of Canadian government negotiators to secure a fair and durable trade resolution with the United States. While bilateral trade negotiations continue, the Company is concerned with the significant impact the current
Algoma has sufficient resources on hand to manage its liquidity over the near term. However, given the ongoing uncertainty caused by the U.S. tariffs resulting in a structural imbalance in the Canadian market, the Company is considering various alternatives to bolster liquidity. Algoma anticipates that such support would be used to support the Company’s continuing operations while exploring diversification of the Company’s customer base to facilitate long-term competitiveness. The amount of additional financing that Algoma will seek will depend, in part, on the duration and severity of the trade dispute and the extent to which the Canadian steel market remains exposed to unfairly priced imports.
As part of ongoing constructive engagement with the Government of Canada, Algoma is exploring targeted liquidity tools and funding programs that could support its current operations and enable strategic diversification. This includes an application to the federal Large Enterprise Tariff Loan (LETL) program for
“We are taking a measured and disciplined approach to evaluating the implications of sustained trade barriers,” said Michael Garcia, CEO of Algoma Steel. “We continue to call for timely, prudent policy support to ensure Canadian steelmakers can remain viable contributors to the national interest. A strong Canadian steel industry is essential to Canada’s economic strength, environmental goals, and national security. With the right frameworks in place, we are confident Algoma will emerge from this period as a vital part of Canada’s nation-building agenda.”
Cautionary Statement Regarding Forward-Looking Statements
This news release contains “forward-looking information” under applicable Canadian securities legislation and “forward-looking statements” within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 (collectively, “forward-looking statements”), including statements regarding the anticipated impact of U.S. tariffs on Algoma, alternatives Algoma is considering to bolster its medium- and long-term liquidity needs, including potential funding under the LETL program, Algoma’s strategic objectives, completion of Algoma’s electric arc technology (EAF) project, the anticipated impact of Algoma’s EAF project and its plate mill modernization project and Algoma’s future financial performance, resulting reduction in carbon emissions following completion of the EAF project, Algoma’s future as a leading producer of green steel, transformation journey, ability to deliver greater and long-term value, and Algoma’s ability to offer North America a secure steel supply and a sustainable future, and investment in its people, and processes. These forward-looking statements generally are identified by the words “believe,” “project,” “expect,” “anticipate,” “estimate,” “intend,” “hope,” “strategy,” “future,” “opportunity,” “plan,” “design,” “pipeline,” “may,” “should,” “will,” “would,” “will be,” “will continue,” “will likely result,” and similar expressions. Forward-looking statements are predictions, projections and other statements about future events that are based on current expectations and assumptions. Many factors could cause actual future events to differ materially from the forward-looking statements in this document. Readers should also consider the other risks and uncertainties set forth in the section entitled “Risk Factors” and “Cautionary Note Regarding Forward- Looking Information” in Algoma’s Annual Information Form, filed by Algoma with applicable Canadian securities regulatory authorities (available under the company’s SEDAR+ profile at www.sedarplus.com) and with the SEC, as part of Algoma’s Annual Report on Form 40-F (available at www.sec.gov), as well as in Algoma’s current reports with the Canadian securities regulatory authorities and SEC. Forward-looking statements speak only as of the date they are made. Readers are cautioned not to put undue reliance on forward-looking statements, and Algoma assumes no obligation and does not intend to update or revise these forward-looking statements, whether as a result of new information, future events, or otherwise.
About Algoma Steel
Based in Sault Ste. Marie, Ontario, Canada, Algoma is a fully integrated producer of hot and cold rolled steel products, including sheet and plate. Driven by a purpose to build better lives and a greener future, Algoma is positioned to deliver responsive, customer-driven product solutions to applications in the automotive, construction, energy, defense, and manufacturing sectors. Algoma is a key supplier of steel products to customers in North America and is the only producer of discrete plate products in Canada. Its state-of-the-art Direct Strip Production Complex (DSPC) is one of the lowest-cost producers of hot rolled sheet steel (HRC) in North America.
Algoma is on a transformation journey, modernizing its plate mill and adopting electric arc technology that builds on the strong principles of recycling and environmental stewardship to significantly lower carbon emissions. Today, Algoma is investing in its people and processes, working safely, as a team to become one of North America’s leading producers of green steel.
As a founding industry in their community, Algoma is drawing on the best of its rich steelmaking tradition to deliver greater value, offering North America the comfort of a secure steel supply and a sustainable future.
Communications contact:
Laura Devoni
Vice President – Human Resources & Corporate Affairs
Tel: 1.705.255.1202
E-mail: communications@algoma.com
Investor contact:
Michael Moraca
Vice President – Corporate Development & Treasurer
Phone: 705.945.3300
E-mail: IR@algoma.com
FAQ
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What immediate liquidity concerns does Algoma Steel (ASTL) face?
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