Canadian steel producer Algoma Steel provided its financial and operating guidance for the first quarter ended March 31, 2026. The manufacturer said total steel shipments for the period are expected to reach approximately 220,000 tonnes, while adjusted EBITDA is forecast to be in the range of minus $25 million to minus $35 million.
The company indicated that expected adjusted EBITDA includes a capacity utilization adjustment of $90-95 million, reflecting excess fixed costs incurred during quarter as production volumes remained below optimal levels as electric arc furnace (EAF) production ramped up.
EAF transition drives higher costs despite structural benefits
According to Algoma Steel, the negative EBITDA outlook is primarily due to the transition phase following electric arc furnace commissioning. The company highlighted that lower production volumes during the ramp-up period resulted in underutilization of capacity and higher fixed costs.
Algoma Steel CEO Rajat Marwah said the first quarter of 2026 represents a key milestone in the company's operational transformation. He noted that the shutdown of blast furnaces and coke ovens had been completed, marking a full transition to EAF steel production following an investment of nearly $1 billion.
Algoma Steel said that while soft demand in the short term continues to impact supply levels,
