The Australian steel industry has urged the federal and state governments to take the lead to ensure the sector remains sustainable.
Amid concerns for local producer Arrium, and in particular its Whyalla operations in South Australia, the Australian Steel Institute says governments must develop a more sustainable procurement model for future infrastructure projects.
“State and federal governments have a clear role to play in establishing procurement policies that both encourage Australia’s industrial productivity while honouring the nation’s international obligations to treat all suppliers fairly,” institute chief executive Tony Dixon said.
“This doesn’t need to be at the cost of a sustainable Australian industrial sector.”
Mr Dixon’s comments came as Industry Minister Christopher Pyne urged NSW to follow South Australia’s lead to ensure the use of Australian steel in major developments.
SA Treasurer Tom Koutsantonis warned that ensuring Arrium’s future at Whyalla would involve government funding and unions called on Arrium to put strong and clear demands to the government “before it’s too late”.
Australian Workers Union National Secretary Scott McDine said the fate of Whyalla and thousands of Australian jobs was on the line, and the company had a social responsibility to be far more proactive.
“What we need is a clear plan. Arrium needs to be very precise about what it … needs to keep its operations afloat and thousands of Australians employed,” he said.
Mr Koutsantonis said the state government was working with Arrium to determine what were the best options to provide for its long-term survival rather than just a “sugar hit” of extra cash.
Mr Pyne said the commonwealth was also doing all it could but cautioned that Arrium was not just under pressure from cheaper steel that may be being dumped in Australia by Asian producers.
The age of the plant at Whyalla, falling iron ore prices and a global steel glut were also issues for the company.
Mr Dixon said if history was any guide, global steel gluts would be balanced with years of shortages.
It was in those times that the resilience of a local steelmaking capability really comes into its own, he said.