$500M loan request top of mind as federal minister visits Algoma Steel

Melanie Joly, the Federal Minister of Innovation, Science, and Industry, visited Sault Ste. Marie on Monday as the company faces huge U.S. tariffs.

Melanie Joly, the federal minister of innovation, science and industry, visited Sault Ste. Marie on Monday for a first-hand look at Algoma Steel’s prized possession – its new electric arc furnace.

Also on the agenda were talks about Algoma’s hopes for a $500-million loan to help it weather 50 per cent tariffs imposed on steel imports by U.S. President Donald Trump.

Last week, CTV News reported that Algoma Steel had submitted the $500-million loan application to the federal government to weather the storm while the trade war rages.

On Monday, Joly and Sault MP Terry Sheehan both said it was on the list of talking points before the minister toured the new electric arc furnace.

“We have started negotiations with the management,” Joly said, who said the talks are “ongoing.”

“(Algoma CEO) Mike Garcia and I … sat down this morning. We had very constructive conversations. And we want to make sure that the steel sector in Canada, which is the crown jewel of our manufacturing sector, is also able to fulfill all the needs of Canadians themselves.”

“The applications are in – we had great discussions and we’re looking at different ways to support the steel industry,” Sheehan added.

“I’m confident that in the end that, you know, we will support the steel industry across Canada and the steel industry will not only, you know, be resilient today, but it will grow in the future.”

Sheehan said that he and his party have been for Algoma Steel in the past when the steelmaker faced major challenges.

“When I was first elected, I was called to a meeting that they were going into bankruptcy,” he said.

“We helped them with that – we helped them modernize with an investment … We also invested heavily in there in 2018 when Trump first put the tariffs on. We continue to have the industry’s and the Steelworkers’ back. And we continue to today.”

Also on Monday, Joly toured the $800-million electric arc furnace, which fired for the first time earlier this month. She said the plant’s steel production is critical to the work her government has planned.

“This plant will be at the core, meeting the demand for all the new nation-building projects that we will soon be approving,” she said.

Key to defence sector

“This plant is key to our defence sector.”

As part of Bill C-5, Sheehan said the federal government believes the steel produced in the Sault could be used in many more projects than just defence.

“We know for a fact Algoma Steel produces military grade plate, and that is going to be used in shipbuilding programs, submarines,” Sheehan said.

“It could be armoured vehicles, but there are other applications – bridges, building beams for housing, even rail.”

In the meantime, times are tough, with U.S. tariffs on steel severely impacting Algoma’s bottom line.

It’s a company that does the majority of its business south of the border.