Dear Minister, for sovereign manufacturing capability – start with steel

Comment by Peter Roberts

Dear industry minister Karen Andrews,

Your government is to be commended for supporting key sovereign industrial capabilities in defence and, now in the light of the Covid-19 pandemic, extending that thinking to broader strategic national manufacturing capabilities.

With respect, there can be no manufactured product more crucial to Australia’s national sovereign defence and economic security than the steel industry.

Steel is the stand out necessity of any modern economy, and today we produce 44 per cent of our crude steel needs, with a total steelmaking capacity of 2.6 million tonnes per annum.

Without steel almost nothing is possible, be it buildings large and small, reinforced concrete structures, railways and mines, ports and airports, ships, trucks and buses, tin cans and bottle tops, and certainly not armoured vehicles, bullets, offshore patrol boats, frigates or submarines.

Without steel and cut off from the world in a crisis Australia would be powerless.

So to create a truly independent nation we need to support our steel industry, and not just tolerate it as we do today, allowing foreigners to dump cheap product locally while we overlook local sources in government procurement and big resources projects.

Fortunately the steel industry of old, maligned for its entrenched unionism, anachronistic management and aged facilities, is no more.

Our two primary steel producers have been reborn in recent years.

BlueScope Steel with its blast furnace at Woolongong in NSW is a financially strong and technologically rich company making steel in Australia and value-added products throughout South East Asia, India, the United States and China.

Its steel rolling, coating and painting technology is the world’s very best, and its creation of Colorbond as a desirable consumer product is a global case study in excellent industrial marketing.

The other contender, Liberty PrimarySteel and its Infrabuild buildings group, owned by Sanjeev Gupta, is perhaps even more dynamic.

In January Gupta re-organised his businesses between Liberty Steel Group which includes the Liberty Primary Steel blast furnace at Whyalla in South Australia, and Liberty GreenSteel which operates electric arc furnaces.

Liberty is pushing ahead with greening its Whyalla mines andfactories with the construction of the Cultana Solar Farm which will boast 780,000 solar PV panels, backed up by pumped hydro energy storage systems in former iron ore pits such as Iron Knob near Whyalla.

Gupta has already let contracts worth $600 million to expand the capacity of the Whyalla works to 1.8 million tonnes a year.

Crucially, he has contracted China Metallurgical Group Corporation (MCC) to run a feasibility study into building a new steel plant in Whyalla capable of producing 10 million tonnes a year, the largest in any developed nation.

The 10 million tonne opportunity is one of those once in a lifetime proposals that all too oftewn get bogged down in government red tape and bureaucratic inertia.

Dear Minister, this is our great opportunity as a nation to transform ourselves from steel also-ran into a global green-steel powerhouse.

Please pull out all stops to clear away impediments, to assist where needed and to push this massive expansion of our steelmaking capabilities.

Our sovereign industry capability and national economic security depends on it.

Picture: Liberty Primary Steel/Whyalla steelworks

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