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OMH competition closing up shop. S32 to close Tasmanian smelter. OM Sarawak Malaysia with cheap power putting pressure on all other smelters.

Temco smelter in Tasmania under a cloud, putting 300 jobs at risk


A smelter in north Tasmania will be sold, closed or mothballed. Picture: Chris Kidd

• MATTHEW DENHOLM
  TASMANIA CORRESPONDENT
  
  

There are concerns for 300 jobs and the broader economy of northern Tasmania, with news a manganese alloy smelter, in the marginal seat of Bass, will be sold, closed or mothballed.
Loss of the Temco plant would be a major blow to the region, particularly George Town in the Tamar Valley, and potentially to the state-owned power generator, Hydro Tasmania.
Global mining and metals company South32 Ltd today confirmed “changes in market dynamics” had “reduced the attractiveness of our exposure” to production of the alloy, used in steel production.

“South32 is reviewing options for our manganese alloys smelters … in Gauteng, South Africa, and Temco in Tasmania,” a company spokesman said.
“Over the next few months we will undertake an assessment of the options for each operation including divestment, care and maintenance, or closure.
“No final decision has been made on the way forward. We will provide a further update in October 2019.”
Acting George Town Mayor Tim Harris told The Australian the news had placed the entire community “on edge”. “If Temco were to shut down that would be fairly big loss to the north (of Tasmania), not just George Town,” he said.
“There’s a fair bit of angst around the community — not only the workers, but our schools, shop keepers and the whole gamut. The whole community is on edge.”
He said “every avenue” was being explored with the company to try to save the ageing plant, although he was concerned about the timing of the announcement so close to an election.
“There seems to be a political football around quite a lot of our industry every time there is an election,” he said. “Whether it’s industry trying to get a better electricity price or saying ‘we need a leg up to stay afloat’ ... it has happened before.”
Sitting Labor MP Ross Hart expressed his solidarity with the workers. “I know these people; I want to ensure they remain in employment,” he said.
The company would not comment on whether it would be seeking any assistance from government to retain the plant, which has been operating for more than 50 years.
Tasmanian Treasurer Gutwein said the smelter was a “key contributor to the state” and the government was seeking more information from the company.
“The Department of State Growth has been in contact and arranged a meeting with the company on Friday morning, to be briefed and gain a better understanding of the situation,” Mr Gutwein said.
It is understood the main driver of its rethink is a global shift in manganese alloy production globally, with China and India increasing steel production and developing their own alloy capacity.
As well, the company is understood to be cognisant of significant new capacity in Malaysia, which has access to cheap hydro power and is closer to markets.