Algoma Steel guided adjusted EBITDA between negative $10 million and negative $20 million for Q3FY26, with total steel shipments around 145,000 tons. The loss was driven by a power outage at Lake Superior Power that constrained production at its electric arc furnace. A replacement turbine is now installed and power has been fully restored, while management used the downtime to advance commissioning of EAF Unit Two. The guidance includes a capacity utilization adjustment of $50 million to $55 million, which softened the operational loss. Without that adjustment, the quarter would have been considerably worse. Algoma is positioning this as a temporary infrastructure disruption rather than weak steel demand, and notes steel prices are improving. The bigger climate story is Algoma's shift from blast furnace to EAF steelmaking, which is expected to reduce carbon emissions by about 70% once fully transitioned. With the second EAF nearing commercial operation, the company's next quarters will show whether the emissions and cost benefits materialize as planned.
