Department of Finance Canada announced federal and Ontario financial support for Algoma Steel Inc. in response to trade pressure on Canada's steel sector.
The federal support is structured through the Large Enterprise Tariff Loan facility. Finance Canada said the term sheet would provide $400 million in federal financial assistance to help Algoma continue operations, reduce reliance on the United States, and limit workforce disruption.
Ontario is adding $100 million under the same terms. Together, the announced support would put $500 million of public financing behind the company while steel producers adjust to changed U.S. trade conditions.
Finance Canada placed the announcement in the context of a rapidly changing trade landscape. The department said more than 85% of Canada's trade with the United States remained tariff-free, but that the effect on sectors such as steel was still profound.
The Large Enterprise Tariff Loan facility was created in March 2025 with $10 billion in available financing for large Canadian companies affected by actual or potential tariffs and countermeasures.
Finance Canada also changed access to the facility. The minimum annual revenue requirement was reduced from $300 million to $150 million, the minimum loan size from $60 million to $30 million, and the loan maturity was extended from five years to seven years.
The department said the updated terms also lowered the initial interest rate and required participating companies to prioritize worker retention.
The business-policy issue is direct. Tariff-related financing affects liquidity, jobs, investment choices, and industrial capacity in a sector that feeds construction, manufacturing, energy, and defence supply chains.
For taxpayers, the public-finance question is how governments use repayable financing to stabilize strategically important companies without turning every tariff shock into a permanent subsidy.