The carbon tax was not responsible for Illawarra Coke Company's decision to close the Coalcliff Cokeworks, a spokeswoman for Federal Climate Change Minister Greg Combet said.
"Illawarra Coke has been under considerable pressure from the high Australian dollar, high input costs and low coke prices," the spokeswoman said.
"Coke production is provided the highest level of assistance under the Jobs and Competitiveness Program. The 94.5 per cent assistance rate is equivalent to over $17 for every tonne of coke they produce.
"Given the substantial assistance arrangements, it is the general market conditions and not the carbon price which is behind this decision."
ICC's managing director, Rex Wright, wasn't blaming the carbon tax for the closure either.
"It wasn't a big problem, it just increased our cost base," Mr Wright said.
"It's a cost and it's a cost that our [overseas] competitors don't have to bear.
"The thing that's impacted us is the European economic crisis and the effect that's had on the worldwide steel industry."
The minister's spokeswoman said the Gillard government's "immediate thoughts are with the workers and their families, just weeks before Christmas".
"The Gillard government stands ready to provide support to any workers who require assistance as a result of this decision," she said.
"If required, workers will be able to access employment and training support through Job Services Australia to help them find new employment."