19 February 2025
Collapse of Whyalla steelworks a pivotal moment for sovereign steel capability in Australia
The collapse of the Whyalla steelworks is an opportunity to develop a genuinely competitive steel manufacturing capability in South Australia, according to the company planning to build Australia’s first hydrogen-fueled emissions-free steel plant.
Sydney-based Greensteel Australia (Greensteel) said the collapse of OneSteel Manufacturing in Whyalla was a setback for the hundreds of employees and suppliers that relied on the plant but could be the trigger to modernise and future-proof Whyalla’s steelmaking operations.
Greensteel last year announced it had placed an order from Italian steel group Danieli for infrastructure to support 100% emissions-free steelmaking in Australia, with hydrogen produced from renewable energy used to fuel arc furnaces. It is the only Australian company to have placed an order for a rolling mill in recent years.
Greensteel’s sister company Reosteel, based in Sydney, is a well-established downstream supplier of finished steel products to the construction industry.
“The collapse of Whyalla will not be a surprise to downstream industry participants that have been watching GFG operations closely and experienced increasingly patchy supply in the past year or more,” said Mena Ibrahim, President and Executive Director of Greensteel Australia.
“It’s a disappointing outcome, but we urge the State Government now to take the opportunity to reimagine the place Whyalla occupies in the Australian steel industry landscape,” Mr Ibrahim said.
“We believe it is critical for Australia’s sovereign steel capability that GFG is replaced with another well-capitalised steel manufacturer able to supply the domestic market,” he said.
Greensteel is currently assessing locations with access to suitable power supply for its new plant, which it is planning to be operational by the end of 2026. Greensteel executives will travel to Italy in March to finalise contracts with Danieli for the purchase of a structural mill, two arc furnaces and a Direct Reduced Iron (DRI) plant.
“The existing plant in Whyalla is old and decaying – we do not believe there is a business case to invest in upgrading the existing plant. The far better course in our view is to scrap and replace it with a new, state-of-the-art mill that is technologically equipped to manufacture emissions-free steel. State Government plans for the $600 million hydrogen fuel hub are already drawn up – all that remains is to put the other pieces of the puzzle in place,” he said.
Greensteel is reconsidering previously-announced plans to locate its hydrogen-fueled plant in Newcastle after being advised by the NSW Government that it could not guarantee sufficient renewable energy supply.
“Whyalla, as one of several sites we are considering, is attractive because of the ample power supply it offers,” Mr Ibrahim said.
Issued by Sefiani, part of Clarity Global, on behalf of Greensteel Australia. Media inquiries to Nick Owens, 0421 977 062 or nowens@sefiani.com.au
