A Rio Tinto aluminium smelter in Jonquière, Que. The Saguenay-Lac-Saint-Jean region has four aluminium smelters and produces a third of the metal produced in Canada thanks to abundant and cheap hydroelectric power.Renaud Philippe/The Globe and Mail
The federal government is having conversations with Rio Tinto RIO-N about how it can provide financial assistance to the mining and metals giant as it faces crushing U.S. tariffs on aluminum and steel.
Industry Minister Mélanie Joly mentioned the talks during a meeting on Thursday with business leaders in Quebec’s Saguenay region, a significant hub for aluminum production also known as Canada’s Aluminum Valley.
“Businesses need liquidity. Conversations with Rio Tinto began [Wednesday], to know how we can help,” she said in French at an event hosted by the Saguenay–Le Fjord chamber of commerce.
Ms. Joly’s comments follow a visit she made on Wednesday to a Rio aluminum smelter in Arvida, Que., where she said she met with leadership of the company, in addition to its employees and the union that represents them.
As the U.S. continues to impose steep sectoral tariffs, Ms. Joly said one of her priorities is protecting jobs, including those in the aluminum sector in Quebec. To do that, the federal government is looking at supporting businesses with liquidity, she said.
Ms. Joly said the federal government is also ready to have conversations with other businesses involved in the aluminum industry.
Canada to limit foreign steel imports to help producers hit by U.S. tariffs
Headquartered in London, Rio is one of the largest mining companies in the world, with a market value of about US$100-billion. It has a significant presence in Canada, with operations in several provinces, mostly in aluminum and iron ore production.
It’s unclear why the federal government is discussing liquidity support with Rio Tinto in particular. Isabella Orozco-Madison, a spokesperson for Ms. Joly, said the government does not have more details to share about those talks at the moment.
Rio Tinto did not immediately respond to a request for comment.
U.S. President Donald Trump escalated his global trade war last month by doubling tariffs on steel and aluminum imports to 50 per cent. The move was especially damaging for Canadian producers, who export the majority of their products to the U.S.
Last month, Prime Minister Mark Carney announced that Canada will limit steel imports to protect domestic producers from dumping, a practice where companies export their products at artificially low prices to gain market share.
The federal government said it will apply a 50-per-cent tariff on aluminum and steel imports that exceed 2024 levels from countries that don’t have free-trade agreements with Canada.
Over the next 20 years, the aluminum producer Aluminerie Alouette will invest $1.5-billion in its facilities in Sept-Îles, Que., pictured here in 2019.Jacques Boissinot/The Canadian Press
Mr. Carney is trying to negotiate a trade and security agreement with Mr. Trump by July 21 that would give Canadian businesses some relief from tariffs.
Based on the results of those negotiations, Mr. Carney said the federal government will adjust its countertariffs on U.S. aluminum and steel.
On Friday, aluminum producer Aluminerie Alouette announced a $1.5-billion investment in its Sept-Îles facilities over the next 20 years. Rio Tinto is the largest shareholder of Aluminerie Alouette, with a 40-per-cent stake.
Representatives of Aluminerie Alouette said the announcement is tied to an agreement in principle with the province’s hydro utility on electricity rates until Dec. 31, 2045.
At a news conference in Sept-Îles, Que., the company said it has committed to investing $750-million by 2030, for a total of at least $1.5-billion by 2045.
Quebec Premier François Legault told the news conference the electricity deal is a positive sign for an industry that has been hit by 50-per-cent tariffs on imports to the U.S.
The government says the agreement allows Hydro-Québec to share in the profits when aluminum prices are high, and permits the company to stay competitive when market prices for the metal drop.
The smelter employs approximately 950 people and has an annual production representing 20 per cent of the aluminum produced in the province.
With a report from The Canadian Press