Algoma Steel's Q2 2025: Unpacking Contradictions on Tariffs, Exports, and Market Conditions

Tariff impact on pricing, U.S. export opportunities, working capital and EAF transition, government import restrictions and market conditions, plate market conditions and pricing are the key contradictions discussed in Algoma Steel Group Inc.'s latest 2025Q2 earnings call.



Challenging Global Steel Market Conditions:
- Algoma Steel reported lower realized prices and higher production costs in Q2 2025.
- The decline was largely due to tariff uncertainty, particularly the increase in U.S. tariffs on Canadian steel from 25% to 50%.

Electric Arc Furnace Milestone:
- First steel production from Unit One of the EAF complex was achieved in early July 2025.
- This represents a major accomplishment in the ongoing EAF project and positions Algoma as a leading decarbonization project in Canada.

Liquidity Position and Tariff Loan Support:
- Algoma's liquidity ended the quarter at over $400 million.
- The company has applied for a $500 million loan from the federal large enterprise tariff loan facility to manage liquidity risks associated with prolonged U.S. tariffs.

Plate Market Performance:
- Plate shipments reached approximately 103,000 tons in Q2 2025.
- Algoma's increased production and quality enhancements contributed to a market share of over 40% in the Canadian plate market.

Trade Barriers and Market Disruptions:
- The company's outbound shipments to the U.S. were subject to a 25% tariff starting March 12, increasing to 50% in June.
- These tariffs resulted in higher production costs and reduced revenue, impacting Algoma's financial performance.