South Australia’s Whyalla Steelworks will permanently shut down its 60-year-old Blast Furnace No. 2.
The decision by OneSteel Manufacturing comes after five months of efforts to restart the furnace proved unsuccessful, with the company finding it unsustainable to continue the recovery.
The closure will end steelmaking operations and parts of the pellet plant operation at Whyalla, affecting up to 500 direct employees and about 100 labour-hire workers, according to investment firm KordaMentha, which was appointed as the voluntary administrator.
However, the Whyalla Port, mining operations, and Steel Products division will continue operating using stockpiled and externally sourced semi-finished steel.
“This is a difficult decision, but it is a necessary one as the company transitions to modern steelmaking technologies. The blast furnace and the current basic oxygen furnace were always intended to be replaced,” joint administrator Sebastian Hams said.
Hams also said OneSteel Manufacturing’s immediate priority was to “engage openly and transparently with employees, unions and other stakeholders throughout the consultation process.”
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Whyalla’s Blast Furnace No. 2 was commissioned in 1965 and relined in 1972, 1981, and 2004.
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The federal and South Australian governments responded with a $10 million (US$7.1 million) package to support Whyalla workers, their families and the broader community.
The governments also said they would continue funding the administration to ensure workers’ wages are paid while consultations proceed.
Federal Employment Minister Amanda Rishworth said her department had staff on the ground in Whyalla from the day of the announcement to coordinate local support and quickly connect workers and families with assistance.
Federal Industry Minister Tim Ayres called the outcome “disappointing” but said the workforce’s resilience “has been extraordinary.”
South Australian Premier Peter Malinauskas said the blast furnace’s closure had always been considered inevitable, with the only question being when it would happen.
“The equipment is more than 60 years old and has not had the investment it deserves through recent decades. In fact, it is only due to the Herculean efforts of the workers in Whyalla that it has survived this long,” he said on X.
However, the premier stressed that the closure does not mean the end of the steel manufacturing facility.
“Whyalla’s future has never rested on this blast furnace. The Steelworks needs the right new owner, willing and able to deliver new capital investment to set up Australian steelmaking for the long term,” he said.
19 Months Under Administration
At the time, the steelworks produced 75 percent of Australia’s structural steel and was the country’s only domestic producer of steel long products.
It also employed about 1,100 workers directly and supported more than 2,000 jobs indirectly.
