Stelco posts strongest quarter since 2024 acquisition as layoffs proceed
The steelmaker's parent company says its Canadian operations were profitable last quarter, but blames imports for job cuts.
HAMILTON — Cleveland-Cliffs says Stelco had its strongest quarter since the U.S. company acquired it in 2024, even as it moves ahead with hundreds of layoffs at its Ontario operations.
"Third quarter was Stelco’s strongest ... since we acquired the company two years ago. The Canadian hot-rolled market has improved substantially," Cleveland-Cliffs CEO Lourenco Goncalves said in a statement Monday.
Ron Wells, president of United Steelworkers Local 1005, told CBC that 333 layoffs were expected in Hamilton. USW Local 8782 president John McElroy said up to 50 layoffs are expected at the Lake Erie Works in Nanticoke.
READ MORE: Stelco defends layoffs as steel exports to U.S. plunge, imports surge
READ MORE: Stelco layoffs in Hamilton signal risk to Canada's steel industry, union says
Goncalves said the layoffs are a temporary measure tied to an oversupply of galvanized steel in Canada. "However, more needs to be done by the Canadian government to correct a clearly oversupplied market for galvanized steel in Canada," he said.
He said laid off workers could be brought back immediately if Ottawa brought in tighter import restrictions. "If the Canadian government uses the power they already have ... to block or severely reduce imports of galvanized steel into the Canadian market, Stelco can immediately bring back all the temporarily laid-off workers," Goncalves said during an earnings call.
He added that the government offered financial support, "but that’s not what Stelco needs."
Federal Industry Minister Mélanie Joly has said "a business decision or even a change in market conditions cannot be used to not follow their commitment." The federal government has said Cleveland-Cliffs's purchase included promises to employ at least the same number of unionized employees as in 2024 through 2029.
Yadude Books reported in October that Ottawa is considering legal action, which could include forcing the company to sell its Canadian assets.
Goncalves said he is prepared to fight the Canadian government in court to preserve the plan to lay off workers.
Wells told CBC Hamilton that workers are feeling "underappreciated" as layoffs proceed. "They're dedicated, loyal employees," he said. "They work weekends, they work holidays, they missed their kids' hockey games, graduations, and that loyalty isn't being repaid."
He also called Goncalves's messaging "confusing." "He said Stelco's Q3 results were good, they're profitable. If they're profitable, why'd he shut down our [cold-rolled] and coated [steel] departments?" Wells said.
Colin Mang, an assistant professor of economics at McMaster University, said the strong quarterly results are "certainly going to be demoralizing for the steelworkers here in Hamilton to know that the company is still doing well financially but is willing to cut them off."
Goncalves praised U.S. President Donald Trump's trade policies, saying they are "helping create the conditions needed for companies like ours to continue investing." In June, Trump signed an executive order applying up to 50 per cent tariffs to certain steel and aluminum imports from Canada.
Stelco produces hot-rolled steel at its Lake Erie Works for products like construction materials, while its Hamilton Works processes steel into cold-rolled and coated products, including galvanized steel.
Joly said Friday that a federal response to the layoffs is just "days" away.
With files from The Canadian Press, CBC News and BNN Bloomberg