Why we need to support the Australian steel industry
Kate Harris, GECA | 20 April 2016
Some say what you accept you deserve – I’m done accepting!
Chinese steel and its impacts on our Australian steel economy has been in the news a lot lately. This is yet another Australian manufacturing story with a possible unhappy ending.
We have seen the death of the car industry – is this the next one to go?
There is a glut of steel on the market – currently over 100,000,000 tonnes in surplus. Well done to China for realising it had to wind down and transition not only the amount of production, but also to stop producing poor practice steel. China also understands the huge social impact on almost two million workers to be laid off, and are trying to manage this responsibly through a staggered approach.
This excess of steel at cheaper prices is impacting our Australian steel industry, along with many others, and the worst may still be to come.
We learnt in previous articles in The Fifth Estate that there are great technological solutions in Sweden and that they are on their way, but not at a fast enough speed to solve our systemic problems in steel.
So I ask, how are we also supporting our best practice steel production in Australia?
Australia is a global leader in industry collaboration and best practice, and should be congratulated. In particular, the Steel Stewardship Council has done wonderful work driving best practice for manufacturing across steel industries in many countries. BlueScope Steel’s Ross Davies and many others are doing excellent work and should be commended.
This is the kind of leadership we should be proud of. We should be supporting their great work.
Australian industry has the additional challenges of a small market and high labour cost but we need to look to the future and understand how not supporting our own Australian steel industry impacts us in the future. There will be challenges such as loss of jobs, knowledge and export opportunities; an over-reliance on trade relationships; and hurting the Australian economy; to name a few.
We do not produce all types of steel required in Australia but we do have excellence in the ones we do produce.
So do we use them?
It seems not all states or projects throughout Australia insist on specifying Australian steel where possible and often look for cheap imports.
So who do we blame if we do not support our own industry? We can only blame ourselves.
As a South Australian who did part of her nursing training in Whyalla and worked at the Royal Adelaide Hospital, it is confusing to read articles such as a recent piece from Daniel Wills and Luke Griffiths in The Advertiser on the 12 April.
The article confessed that foreign-made structural steel – the same type made by Arrium in Whyalla – had been used in the most expensive construction contract South Australia has ever signed.
Obviously the community of Whyalla will want to know why we are not using our own product, as the future of Arrium looks bleak. The Arrium issue has been quoted as being bigger than the Holden impact.
Transport and Infrastructure Minister Stephen Mullighan confirmed to The Advertiser that overseas structural steel had been used in the new Royal Adelaide Hospital – but said the scale and complexity of the project made it impossible for him to detail how much Whyalla product had been included.
Apparently the South Australian government recently mandated locally sourced steel for projects – so what about the rest of us?
Senator Xenophon said the NSW Government was one of the worst offenders at favouring foreign over Australian steel.
He was recently quoted by the ABC as having said: “The NSW Government has been a disgrace in the way it has implemented its procurement policies.
“It has recently imported 100 kilometres of steel rail track from Spain for one of their infrastructure projects and there is no excuse for that. It could have been procured locally.”
And what are the other ramifications?
Along the grapevine it seems that imported steel is not all that it is all cracked up to be – and cracking is only one of the issues stemming from poor quality imports that cannot be discussed due to consumer in-confidence arrangements.
So who is doing the checking? How can we have assurance with such a complex supply chain? GECA is yet to create a steel standard but it is high on the agenda, especially knowing the issues in the industry.
So next time you are going over a bridge or on the 53rd floor of a commercial high rise, let’s hope they used the good stuff. Ask for not only quality, but assured sustainability from your suppliers, and know that you will not only support long-term outcomes in quality and sustainability but also the Australian economy.
Kate Harris is chief executive of Good Environmental Choice Australia.