Ontario-based Algoma Steel says it has made the “difficult decision” to issue layoff notices to about 1,000 workers as it prepares to shut down its blast furnace and coke-making operations in early 2026, blaming steep U.S. tariffs for fundamentally changing its business.
The Sault Ste. Marie company, which employs roughly 2,700 people, has been hit hard by the 50 per cent tariffs imposed last summer by U.S. President Donald Trump, a major blow given that most of its customers are in the United States.
“The North American steel market is highly integrated, and Algoma Steel has been significantly impacted by the unprecedented tariffs imposed by the United States,” spokesperson Laura Devoni said in a statement. “These tariffs have fundamentally altered the competitive landscape and sharply limited our ability to access the U.S. market.”
As a result, Algoma will end its long run as an integrated steelmaker and move entirely to Electric Arc Furnace (EAF) steelmaking, a transition the company says it is now being forced to implement a year earlier than planned. The approximately 1,000 layoff notices issued Monday take effect in 16 weeks, on March 23, 2026.
“This transition is necessary to protect Algoma’s future in the face of these extraordinary and external market forces,” Devoni said, adding the company will continue to push for a “competitive and fair trading environment for Canadian steel.”
In September, Ottawa and Queen’s Park announced a combined $500 million in loan support to help Algoma adapt to the tariff-driven shock, with $400 million coming from the federal Large Enterprise Tariff Loan program and $100 million from the Ontario government.
For workers on the ground, the news is a major blow. Bill Slater, president of United Steelworkers Local 2724, called the announcement “devastating,” especially with the holidays approaching. “Sitting around the Christmas table knowing that your job is coming to an end will not be a fun thing to do,” he told CTV News. Slater said the union is pushing to get an action centre in place in Sault Ste. Marie by the end of January to support affected workers once layoffs begin in March.
Ontario Trade Minister Vic Fedeli said the province will activate a local POWER (Protect Ontario Workers Employment Response) centre to provide retraining and other supports to help workers transition to new jobs. He also pointed to the Buy Ontario Act, which prioritizes domestic inputs, including Ontario steel, for government procurement, and urged the federal government to accelerate projects that can use Ontario-made steel in pipelines, infrastructure, ships and defence equipment.
Sault Ste. Marie–Algoma MP Terry Sheehan said he is in contact with federal departments and agencies to ensure services and supports for laid-off workers are fast-tracked. “Our new government has already taken significant steps to strengthen protections and increase assistance for workers impacted by layoffs,” he said, pledging to “fight tirelessly” for affected families and the community.
Algoma maintains that the layoffs, while painful, are aimed at ensuring the company’s long-term viability. “We fully understand how unsettling this news is for our employees, their families, and the broader Sault Ste. Marie community,” Devoni said. She added that the company will work with federal and provincial partners, unions and local agencies in the coming months to provide support and transition assistance to all affected employees.