Prime Minister Mark Carney says Canada’s federal government will “use all powers that we have” against the U.S. owner of an Ontario steel plant that announced hundreds of layoffs on Monday. 

Stelco, owned by Ohio-based Cleveland-Cliffs, directly linked its plan to cut up to 500 jobs in Hamilton with U.S. President Donald Trump’s trade war with Canada. 

The Trump administration imposed 50 per cent tariffs on foreign steel under Section 232 of the Trade Expansion Act last year. Canada has retaliated with duties on many U.S.-made steel products.

Speaking to reporters on Tuesday, Carney singled out the company’s CEO, Lourenco Goncalves, for “applauding” Trump’s move to impose punishing tariffs on Canadian steel imports to the United States.

“Our thoughts are with the workers and the families who have been betrayed by the company,” Carney said at a news conference in Vancouver.

“The company made representations, and has legal obligations for employment. We intend to use all powers that we have, and pursue them to the fullest extent of the law.”

Cleveland-Cliffs acquired Hamilton-based Stelco in a $3.4-billion Cdn cash-and-stock deal that closed in November 2024. In a news release announcing the deal, Stelco’s then-CEO Alan Kestenbaum stated the transaction “keeps national interests at the forefront and recognizes the importance of the workforce.”

Carney said he is “very disappointed” by the company’s decision to lay off workers.

In a memo obtained by CBC News, Stelco vice-president of sales Frederic Fafard called the situation “an unfortunate but necessary action to help ensure the survival of Stelco in what has become a challenging and unsustainable market.”

The prime minister said on Tuesday that there is “money on the table from the federal government” to help companies like Stelco blunt the impact of the ongoing trade war. 

In an email to CBC News on Monday, a Cleveland-Cliffs spokesperson confirmed Industry Minister Mélanie Joly had been in touch with Goncalves about financial support.

Pat Persico, Cleveland-Cliffs’ senior director of corporate communications, said while Stelco is idling some of its operations in Hamilton, the company expects “a significant number of workers” will be absorbed by the company’s Lake Erie Works in Nanticoke, Ont.

Cleveland-Cliffs did not respond to a request for comment on Wednesday regarding Carney’s mention of potential legal action against the company.