The primary employer in Sault Ste. Marie, a city in northern Ontario, is set to receive $500 million in government loans to safeguard its workforce amid U.S. tariffs. Federal Jobs Minister Patty Hadju revealed the assistance during a visit to the steel mill on Monday.
Under a “term sheet” agreement, the federal government is extending a $400 million loan to Algoma Steel through its “large enterprise tariff loan” program, while the Ontario government has committed an additional $100 million under the same terms. This funding aims to support the plant in sustaining operations, transitioning to a business model that reduces dependence on the United States, and minimizing disruptions to its employees.
This financial aid is part of a $10 billion financing initiative unveiled in March to assist large companies in combating tariffs and associated challenges. It complements various tariff-related initiatives introduced by the federal government to bolster the Canadian steel sector.
Established in 1901, Algoma Steel is now a prominent manufacturer of hot- and cold-rolled steel sheet and plate products in North America. The company employs approximately 2,600 individuals in Sault Ste. Marie, a city with a population of around 72,000.
Earlier in July, Algoma Steel had applied for a $500 million loan from the federal government due to the 50% tariffs imposed on Canadian steel exports to the U.S. In response to the tariffs’ adverse effects on its operations and prospects, the company expressed concerns and emphasized the need for supportive policies.
Algoma Steel CEO Michael Garcia stated, “We are evaluating the implications of sustained trade barriers in a cautious and strategic manner. Timely and judicious policy support is crucial to ensure the viability of Canadian steelmakers, which are integral to the country’s economic strength, environmental objectives, and national security. With appropriate frameworks in place, we are confident that Algoma will play a crucial role in Canada’s development agenda.”
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