Algoma Steel Completes EAF Transition Amid Tariff Pressures and Record Plate Sales
Event summary
- Algoma Steel completed its transition to Electric Arc Furnace (EAF) steelmaking, permanently closing its blast furnace on January 18, 2026.
- First-quarter 2026 revenue dropped to $296.9 million from $517.1 million in the prior-year quarter due to transition costs and tariff impacts.
- Record plate sales of 116,000 NT were achieved, with further upside expected as the plate-first strategy scales.
- Adjusted EBITDA loss of $28.7 million, inclusive of a $90.2 million capacity utilization adjustment, was reported.
- Direct tariff costs rose to $27.4 million, compared to $10.5 million in the prior-year quarter.
The big picture
Algoma Steel's transition to EAF steelmaking marks a significant shift in the Canadian steel industry, aligning with global trends toward decarbonization. The company's focus on discrete plate production positions it uniquely in the Canadian market, but it must navigate ongoing tariff pressures and operational challenges to realize its strategic goals. The scale of the EAF transformation and its potential to reduce carbon emissions by 70% underscores the broader industry movement toward sustainable steel production.
What we're watching
- Operational Ramp-Up
- The pace at which Algoma Steel can fully ramp up its EAF Unit 1 and commission EAF Unit 2 will determine its ability to improve financial performance.
- Tariff Impact
- How the 50% U.S. Section 232 tariff on Canadian steel imports will continue to affect Algoma's commercial strategy and financial results.
- Strategic Partnerships
- Whether Algoma's partnerships with Roshel Inc. and Hanwha Ocean Co. Ltd. will successfully diversify its product portfolio and drive long-term growth.
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