Alcoa’s Port Henry aluminium smelter at Geelong will have a review of its operations handed down in March, with jobs of more than 500 employees to go if the struggling plant closes.
The Australian reports that the US-based company’s review is tipped by analysts such as Credit Suisse to recommend the plant be shut down. The price of aluminium remains low due to high Chinese production and Australian production of the metal is expensive.
The Geelong plant was bailed out to the tune of $40 million by the previous government in June 2012 on the condition it stay open until at least June 2014. Credit Suisse has predicted a shutdown will come in the second half of the year.
Prime minister Tony Abbott indicated the government’s negativity towards propping up unviable factories after Holden announced in December that it would end its Australian manufacturing in 2017. The office of industry minister Ian Macfarlane has refused to say whether or not extra help would be given to Alcoa.
“We are very concerned about the future generally of Australian aluminium but Point Henry in particular because it is under formal review,” the Australian Workers Union’s Paul Howes told The Australian.
“...the global conditions for aluminium are still very negative, and with the dollar sitting where it is at -- even though it eased off it is still well above where it was 10 years ago -- Australia has become a very expensive place to produce aluminium.”
The smelter’s closure would be another hit to Geelong, with Royal Dutch Shell announcing last year that its refinery was up for sale and Ford Australia to close its engine plant in 2016.