U.S. Steel–Algoma Pellet Dispute Heads to Binding Arbitration

SEATTLE (Scrap Monster): U.S. Steel’s legal battle with Canada-based Algoma Steel over unpaid iron ore pellets is moving forward under binding arbitration, marking a key procedural shift in the high-stakes dispute. The case stems from an October lawsuit filed in federal court in Pittsburgh, in which U.S. Steel accused Algoma of breaching a long-term supply agreement signed in 2020 and set to run through 2027.

Under a December 12 order issued by U.S. District Judge Marilyn Horan, the dispute will now be reviewed by a panel of three neutral arbitrators. The ruling follows Algoma’s earlier attempt to have the contract voided by a Canadian court, arguing that U.S. import tariffs had rendered its blast furnace operations uncompetitive in the American market.

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U.S. Steel responded by filing suit, claiming Algoma already owed approximately $22 million, with potential damages approaching $100 million. Judge Horan also rejected Algoma’s request to dismiss the case for lack of jurisdiction, noting that payments were routed to U.S. Steel accounts in Pittsburgh and that the contract explicitly required disputes to be resolved in Pennsylvania.

Algoma did not immediately respond to requests for comment, leaving arbitration as the next critical phase in the dispute.