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The future of steelmaking in the Illawarra remains under a cloud and BlueScope workers still fear for their jobs a week after reports emerged that the firm planned to cease manufacturing in the region by 2017.
BlueScope Steel and the Australian Workers Union quickly denied this was the case but the manufacturing giant did confirm it needed to save about $130 million a year to keep Port Kembla steel operations viable.
AWU branch secretary Wayne Phillips said up to 1000 jobs could be directly affected as BlueScope engaged in large-scale cost-cutting to reduce the cost of steelmaking by at least $50 per tonne.
BlueScope corporate affairs manager Michael Reay said no decision had been made on where proposed savings were to be found, but admitted the company was looking at options, including importing steel rather than manufacturing at Port Kembla.
He confirmed the $50 per tonne saving was a target, and said the company had projects in place to make that happen.
BlueScope employees are in the midst of enterprise bargaining with management. Mr Phillips said the reports of closure had "scared the hell out of a lot of workers" and claimed the company would use the opportunity to scale back employee entitlements like sick leave.
"They say they're not in crisis mode, but they're very worried.
"They have to save a lot of money, otherwise they'll look at other ways to get steel, like importing rather than manufacturing on site," he said.
"If they can't do that, the option might be to shut down operations."
The region's politicians expressed their shock amid reports cost-cutting at BlueScope's Port Kembla steelmaking plant will see jobs go.
Most MPs urged the company to "come clean" about its future in the region.
"Steelmaking at Port Kembla is a part of our history. Whenever we see speculation like this we know that it is very difficult not just on the families but also the associated businesses who rely on the steelmaking at BlueScope," Keira MP Ryan Park said.
Shellharbour MP Anna Watson said this was a bombshell for the Illawarra and it was crucial that BlueScope management as a matter of urgency explained what its intentions were on the future of steelmaking in the region.
Federal Member for Throsby Stephen Jones said he spoke to the company and expected BlueScope to negotiate with workers in good faith.
Parliamentary secretary for the Illawarra Gareth Ward also spoke to the company, saying he was told they were committed to the region.
Australian Industry Group regional manager Leanne Grogan did not expect BlueScope would put off hundreds of workers in the near future.
But she said in terms of the global market, BlueScope had to find savings somehow.
South Coast Labour Council secretary Arthur Rorris said the market prices were "in BlueScope's favour", despite many aspects of the industry often being beyond its control.
"Things are serious [at BlueScope], there's no doubt about that, but the good news is they can actually be addressed," he said.
Mr Rorris said if all governments used local steel that would "have a dramatic impact on the demand and sales at BlueScope Steel".