Stelco Holdings Inc. to Lay Off Hundreds Amid Shift in Production Due to U.S. Tariffs

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Stelco Holdings Inc. announces plans to lay off up to 500 workers as it idles operations in Hamilton, Ontario, due to a significant decrease in demand for its products following U.S. tariffs.

HAMILTON, ONT. — Stelco Holdings Inc. has made the difficult decision to lay off hundreds of employees as it prepares to idle its finishing operations at the Hamilton, Ontario plant. This move is primarily a response to a shift in production caused by the imposition of U.S. tariffs affecting the steel industry. According to a memo that was reviewed by The Canadian Press, the potential layoffs could impact as many as 500 workers across both the Hamilton and Lake Erie facilities. The company expressed that this decision, while unfortunate, is essential for its survival in the current market conditions. The memo highlighted a significant decline in demand for Stelco's cold rolled and galvanized products, stating that in the second quarter of 2026, demand in the markets that Stelco traditionally services dropped by nearly 25 percent compared to the quarterly average in 2024. This decrease includes a troubling 10 percent drop in market demand within Canada, as local customers and manufacturers of steel products face challenges stemming from ongoing trade conflicts. Although the federal government has implemented measures to reduce imports, Stelco noted that the volume of imports remains excessively high, preventing the company from compensating for the market gap created by these trade tensions. As part of its strategic response, Stelco plans to consolidate production at its Lake Erie facility located in Nanticoke, Ontario. Pat Persico, a spokesperson for Cleveland-Cliffs Inc., Stelco's parent company, indicated that while the product mix will change, the overall tonnage of steel production is expected to remain stable. Persico also reassured that many employees affected by the indefinite idling at the Hamilton facility would be offered job opportunities at the Lake Erie Works. This statement comes in light of the recent acquisition of Stelco by Cleveland-Cliffs in 2024. The situation at Stelco reflects broader challenges within Canada’s steel industry. For instance, in December of last year, Algoma Steel revealed plans to lay off over 1,000 workers, which constituted about a third of its workforce, while also accelerating its transition to new equipment to adapt to the tariff environment. Similarly, in June of the previous year, ArcelorMittal Long Products Canada announced the closure of its wire drawing mill in Hamilton, resulting in the loss of 153 jobs. These developments underscore the ongoing difficulties faced by the steel sector in Canada due to external trade pressures.

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