Algoma’s new EAF to produce steel in Q2 2025

Published by:Alesha Alkaff<>
30 Apr 2025 @ 17:45 UTC

Algoma’s new electric arc furnace (EAF) is scheduled to begin producing steel in the second quarter of the year instead of the company’s original April deadline, thanks to harsh weather conditions that impacted the timeline of the project, chief executive officer Michael Garcia said during the company’s first-quarter earnings call on Wednesday April 30.

The project, which has racked up a cumulative investment of $824 million, involves the commissioning of two new EAFs to replace the company’s existing No7 blast furnace, cokemaking, and basic oxygen steelmaking operations.
The Sault Ste. Marie, Ontario-based company anticipates its first EAF to begin producing steel in the second quarter of the year and the second EAF to be fully operational by the end of the year.
Once both furnaces achieve full operation, we anticipate reaching a capacity of 3 million tonnes annually. This production level will optimize our currently underutilized downstream finishing capacity, Garcia said.
The first EAF was originally scheduled to be operational in April, but unfavorable weather conditions and higher-than-expected levels of snow delayed the plant’s start date.
We had colder-than-expected seasonal temperatures, which affected our ability to commission some of the critical systems, especially the water treatment plant, Garcia said.
The shift to steelmaking via EAF is expected to decrease Algoma’s annual carbon emissions by up to 70% compared with current levels.
Canadian steel prices at a 25% discount vs US: Garcia Prices for steel in the Canadian market are about 25% lower than that of the US, Algoma’s CEO said on the call, citing comparatively cheaper imports coming into Canada that are oversupplying the market.
Over 50% of the Canadian market is serviced by imported steel, and a lot of that imported steel is coming in at pretty low pricing. We believe there’s a significant amount of it that is unfairly traded into Canada, Garcia said.
The presence of all the foreign steel in Canada…has led to the current situation where the Canadian market pricing is significantly lower than the US market pricing, and it’s settling out about that at that 25% lower level, he said.