US Steel has filed a lawsuit against Algoma Steel (TSX: ASTL), one of Canada’s largest steel producers, alleging the company backed out of a multimillion-dollar contract to purchase iron ore pellets.
The complaint, filed in federal court in Pittsburgh, claims Algoma Steel breached a five-year-old agreement to buy millions of tons of iron ore pellets from US Steel’s Minnesota mining facilities.
Algoma refused a scheduled shipment in late September and subsequently blamed the dispute on the Trump administration’s 50% tariffs on Canadian steel and aluminum, according to court documents.
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The contract, signed in May 2020, was set to run through January 2027 with negotiated rates for the iron ore pellets. Under Pennsylvania law, which governs the agreement, disputes must be resolved through arbitration in Pittsburgh.
US Steel argues that Algoma is obligated to honor the contract despite changing trade conditions. Algoma Steel has not yet filed a response or issued a public comment on the lawsuit.
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