Smoke exits the Stelco Hamilton Works steel mill.Carlos Osorio/Reuters
Cleveland-Cliffs Inc., the American owner of Stelco Inc., is locked in a blustery battle of wills with Ottawa over Canadian job cuts.
The Ohio-based steelmaker, which is waging Washington’s trade war by proxy, is goading Prime Minister Mark Carney’s government to take it to court for violating labour commitments tied to its takeover of Stelco two years ago.
Canadian officials, too, are refusing to back down, floating possible legal action that could result in financial penalties and the forced divestiture of Stelco. But in characteristic Canadian fashion, they have also consistently conveyed a willingness to resolve the conflict in conjunction with the company. You know, the old-fashioned way, by talking face to face.
Joly warns Stelco owner of forced divestment if Ontario layoffs go ahead
“Everything is on the table and so therefore, I’m always open to sit down with the company and find a solution, but we’re looking at everything that is possible to keep jobs in Canada,” Industry Minister Mélanie Joly said at The Globe and Mail’s defence summit in Ottawa on Wednesday.
Cleveland-Cliffs’s chairman and chief executive Lourenco Goncalves, who takes credit for influencing Washington’s steel and aluminum tariffs, is confusing classic Canadian collaboration with capitulation, much like his political paladin, U.S. President Donald Trump, did in August. Canadians, though, are in no mood for more American monkeyshines – and Mr. Carney and his cabinet know it.
At stake in this dispute are up to 500 jobs in Hamilton and Nanticoke, Ont., meaning the Stelco layoffs strike at the heart of the province’s manufacturing heartland.
Although Stelco is long past its heyday, its fate is still of strategic importance to Canadians. As Mr. Carney points out, domestic steelmaking is key to Canada’s national security because it is used to make defence products and critical energy infrastructure.
Ms. Joly is insistent that Cleveland-Cliffs made legally binding employment guarantees in exchange for Ottawa’s approval of its $3.4-billion acquisition of Stelco in 2024. Mr. Carney has appropriately called it a betrayal.
Indeed, a government statement from that time makes clear the company promised to “continue to employ at least the same number of unionized employees and the vast majority of non-unionized employees” for five years.
But in recent days, Cleveland-Cliffs has denied violating its commitments, contending its undertakings did not include a vow to avoid layoffs at Stelco.
Opinion: The steel jobs may never come back. Ottawa should consider nationalizing Stelco
Its executives have engaged in other mental gymnastics by brazenly arguing that its promise to maintain job levels does not apply to every single day of the five years covered by its undertakings with Ottawa. Huh?
They are also claiming the company would call back laid-off Canadian workers once Ottawa reaches a “Fortress America” trade pact with the U.S. – another sign that Mr. Goncalves is carrying water for Washington.
Cleveland-Cliffs announced the Canadian layoffs on Sept. 28, purporting it couldn’t compete in the galvanized steel market because of the trade war with the United States.
Yes, the very trade war that its top executive, Mr. Goncalves, encouraged in the first place, ostensibly because of “trade distortions enabled by foreign countries,” as he said on an investor call in February, 2025, according to a transcript from S&P Global Market Intelligence. Of course, market disruptions caused by the U.S. are acceptable.
“These tariffs are critical to addressing the problem, and we thank the Trump administration to have the courage to implement these tariffs,” he said on the same conference call.
Mr. Goncalves has since clarified that those comments shouldn’t be interpreted as an attack on Canada because he was merely expressing support for Mr. Trump’s policies.
That still doesn’t explain why the company failed to apply for provincial tariff relief if Canadian jobs were at risk.
In a previous interview with The Globe, Mr. Goncalves also mocked an aggrieved Canadian steel customer as a “walking eagle” – a euphemism for a bird grounded by the weight of its own excrement.
It’s all a bit rich.
Cleveland-Cliffs telegraphed the potential for broken promises in its 10-K annual report filed with the U.S. Securities and Exchange Commission on Feb. 9, stating that it faces “ongoing risks arising out of the Stelco acquisition.” Those uncertainties, it said, include “our ability to satisfy our operational, employment, environmental, charitable or other undertakings made to the Canadian government.”
In late July, the company signalled again that Canadian jobs could be in jeopardy. “We continue to defend our point of view with the Canadian government officials, asking them to do what is right to protect the steel industry in Canada, just as our American government has done here in the United States,” Mr. Goncalves said on the company’s second-quarter earnings call.
Are Canadians really to believe that Cleveland-Cliffs is a hapless victim of U.S. tariffs?
At least the shenanigans that U.S. Steel Corp. pulled with Stelco years ago were ordinary corporate fecklessness. Cleveland-Cliffs, on the other hand, is choosing to cheerlead Mr. Trump’s churlish trade war.