An Illawarra union boss admits "things are serious" at BlueScope Steel, but says the problem could be fixed if the government used more Australian steel.
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South Coast Labour Council secretary Arthur Rorris said the market prices were "in BlueScope's favour", despite many aspects of the manufacturing industry often being beyond its control.
"The input prices of coal and iron ore are at the bottom end of their cycle, so that's good news, as is the fact that the value of the Australian dollar is also a lot lower than where it was previously when it was squeezing the steelmaker," Mr Rorris said.
"They are normally the things that are working against us, but in this case these things should provide a good cost environment for the steelmaker."
BlueScope said on Thursday it needed to adopt a "game-changing approach" to save millions of dollars and keep steel operations at Port Kembla viable.
Speculation the company planned to cease steel manufacturing in the Illawarra by 2017 were denied by the company and the Australian Workers' Union.
Mr Rorris said a reliance on domestic sales and consumption had been evident since the company shut down its No.6 blast furnace at Port Kembla in 2011.
"The problem that we are having is something that can be fixed ... government policies can be changed for local procurement," he said. "If we used more Australian steel, even if it was just [for] the taxpayer-funded infrastructure and other projects that are already in the pipeline that would have a dramatic impact on the demand and sales at BlueScope Steel.
"These are things that are in our power to change and they don't have anything to do with the steelmaker having to cut more jobs," Mr Rorris said.
"This is a call ... to all governments, but in particular to the federal and state governments, to say there is something that can be done and our community, I think, wants it to be done and that is to use local steel."
Mr Rorris said the United States, China and Europe had policies in place that resulted in a higher utilisation of local steel.
"Now, particularly now at this hour, at five minutes to midnight, it is essential the federal government changes tack ... to do something more akin to what others are doing around the world to ensure the survival of their steel and manufacturing industries," he said.
"Things are serious [at BlueScope], there's no doubt about that, but the good news is they can actually be addressed."
BlueScope can survive for a long time in the Illawarra but everyone needs to come together and find a solution that works best for the whole community.
That was the call made on Thursday by the Illawarra Business Chamber, in response to the market pressures facing BlueScope.
Chamber chief executive Debra Murphy said BlueScope’s situation was not unique and it was important for everyone, including the unions, to work together and look at the big picture to find the best solution.
‘‘Our March business conditions survey found that 91per cent of Illawarra businesses are prioritising lowering costs by increasing efficiency,’’ Ms Murphy said. ‘‘BlueScope, like thousands of other businesses, is facing increasing market pressures and must make adjustments to be competitive in today’s global environment.’’
Ms Murphy said a solution would require the ‘‘dinosaur’’ union attitudes and behaviours of the past to be left in the past.
‘‘All parties involved need to accept today’s market environment and work together constructively to find ways to alleviate the extensive global and local market pressures on the manufacturing and steel industry,’’ she said.
‘‘We call on all involved, including employees, management and unions to collaborate sensibly and openly to find workable solutions that optimise outcomes for the region as a whole.
‘‘Prehistoric ways of working are no longer effective. All involved need to accept that new and innovative ways of adapting to a competitive landscape are essential for the ongoing viability of BlueScope, as well as the flow-on contractors and suppliers in the region.’’