Stelco’s Bayfront land purchases spark talk of blast furnace restart
Hundreds of new jobs would be in play if company pulls the switch, experts say
Stelco’s buying spree of Hamilton Bayfront property is a sign the company’s owners must be looking seriously at restarting an idled blast furnace as part of an expansion of steel operations in Hamilton, a steel analyst says.
“I think they are making moves to open up that possibility ... that they are ramping up,” says Peter Warrian, from the University of Toronto Munk School of Global Affairs.
“They’re aligning the pieces to be able to do that. But they are not pulling the switch just yet.”
The blast furnace — which is on 750 acres of property the company is purchasing at what used to be called Hilton Works — has been idled since 2006. Restarting would cost up to $50 million, experts say, and would lead to hundreds of new jobs.
The speculation about plans by Stelco’s owners Bedrock Industries comes after a sudden announcement Friday that the steelmaker is buying nearly 3,000 acres of land in Hamilton and Nanticoke for $114 million, most of which it had previously been leasing from a land trust.
The move was a surprise because a key component of the restructuring deal last summer — that was completed with Bedrock as the new owner after the company emerged from three years of bankruptcy protection — was the creation of the land trust.
Among other things, the land trust meant the company was protected from environmental liability arising from historic contamination of the property.
Now Stelco is saying that protection — offered through the Ministry of Environment and Climate Change — has been grandfathered to the new deal. A ministry spokesperson was not able to confirm or deny that.
Warrian said the enthusiasm for restarting the blast furnace at Stelco has to be tempered somewhat by U.S. President Donald Trump’s 25 per cent tariff on imported steel that went into effect June 1. It means it is tougher to sell Canadian steel in the U.S.
And yesterday, U.S. Steel announced it is restarting the second of two blast furnaces at its plant in Granite City, Ill., in anticipation of increased domestic sales because of the tariffs. The move will lead to more than 300 new jobs.
That announcement is expected to bolster pro-tariff arguments in the U.S., that tariff walls will encourage more domestic steel production and American jobs.
However, Warrian believes it’s not clear whether the steel tariffs are “just a side show, a hostage taking, to try to get a better deal with the NAFTA renegotiations or whether Trump plans to stick with them.”
Meanwhile, Hamilton City Manager Chris Murray says the city is watching developments closely over plans for the newlyacquired property.
The City is hoping to meet with Stelco’s owners to discuss development possibilities on portions of the land that will not be used for steelmaking.
The city, he says, is concerned that excess lands might be “squandered” on “low value” uses such as storage or warehousing. “We feel there is so much more that is possible.”
Murray said he understands that Laborers’ International Union of North America — for one — has expressed interest. LiUNA has apparently filed a letter of interest in acquiring up to 500 acres, if available, for unspecified redevelopment. A spokesperson for LiUNA could not be reached.
Stelco has not commented on its intentions for the land.
However a media release Tuesday said, “We look forward to engaging with various other parties including the City of Hamilton on further development opportunities of the land and port area.”
Officials with the city say no meeting so far has been scheduled. It will not likely take place until Mayor Fred Eisenberger returns from a trip in England.