AWU calls for smelter strategy amid growing crises

The Australian Workers Union has backed calls for a strategy to manage the billions of dollars being sought to prop up fiscally troubled metal smelters, as The Australian Financial Review reports.

National secretary Paul Farrow said the AWU would welcome a smelting strategy under Labor's Future Made in Australia policy, with equity or long-term loans on the table for businesses being forced to weather global markets being distorted by China and others.

“Patient investment in many sites could ultimately deliver a return to government – boosting not draining the balance sheet,” Farrow said.

The AFR last month revealed the Tomago aluminium smelter was in urgent talks to secure billions of dollars from the NSW and federal governments to save it from failing due to crippling energy costs.

Meanwhile, Swiss-based Glencore and Nyrstar Australia, owned by Swiss commodities giant Trafigura, have pitched for support to keep open smelters in Mount Isa in Queensland, Port Pirie in South Australia and Hobart.

The multiple crises underline the financial struggles faced by manufacturers of aluminium, nickel, copper and other metals amid significant declines in treatment and refining revenues due to strong competition from smelters in China, as well as rising energy costs.

The annual benchmark for copper concentrate smelting prices has recorded an unprecedented 75 per cent collapse so far this year.

Independent MP for Kennedy Bob Katter wrote to Resources Minister Madeleine King and Industry Minister Tim Ayres criticising Glencore's reported request for $2 billion a year over 10 years to keep its copper smelter operating.

Katter described the request as “rather brazen” given he claimed it did not come with an equity stake.

“I do believe there is a positive way forward that could allow for the mine and smelter to continue operations without a government bailout,” he said.

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