Canada is a key player in global steel manufacturing, but the country’s steel industry has been in decline since 2007, according to an industry source.
While steel production in the country has been steadily rising in recent years, the industry source said it is in need of a big boost in investment, which could include building new factories.
Canada’s government has committed $100 million in new capital investment for the steel industry, but many experts believe it will only be sufficient to get steel production back on track, if it can attract investment.
“We need a lot more investment,” said Michael Chaudhary, an analyst at Morgan Stanley Canada.
“There are a lot of pieces that need to come together.”
Canada’s steel production fell by 4.3% in 2016, according a report by the International Steel Institute, a research group in Geneva, citing data from Statistics Canada and Statistics Canada Canada.
The institute also reported that steel production plunged 7.5% in the second quarter of 2017, and that production was down 8.2% in 2017.
Chaudbary said that while the country is a large producer of steel, it lacks the scale needed to compete with China, where it is one of the world’s largest producers of steel.
Chretien’s government, meanwhile, has been trying to revive its steel industry with $15 billion in public investment over the next four years.
In 2017, the government announced it was building a $3 billion steel mill in Guelph, Ontario, that would produce steel plates for export to China.
Choudhary noted that Canada’s economic performance over the past decade has been very mixed.
In the years following the financial crisis, it saw its steel exports grow faster than the rest of the industrialized world, but it also saw its production decline sharply.
Chautauqua, Ont.-based steelmaker PSC Canada Ltd.
said it has invested $1.2 billion to build a new plant in Guellans-Lamont, Que., in 2018.
PSC will begin production of steel plates next year, and the company expects to begin exporting the products within the next two years, said co-owner and president Mark Pritchard.
“This is a win-win for all parties,” said Pritchett.
“The country is investing and the manufacturing is growing, and I’m sure we’ll be able to see continued growth in the future.”