Bhp's Output Cut Thanks To Asia
Illawarra Mercury
Thursday January 28, 1999
Continuing weak demand in Asia has bitten deeper into BHP Co Ltd's steel business with the announcement yesterday of a 15 per cent cut in rolling mill production at the Whyalla steelworks in South Australia.
The 70,000-tonne cut to production will pare back annual production from the rolling mill to 400,000 tonnes per year.
This followed a 14 per cent cut in raw steel production, or 1.2million tonnes on an annualised basis in late November, which was also attributed to poor world market conditions.
The company said 70 jobs would be scrapped at the Whyalla rolling mill with employees being offered voluntary redundancies. Under a security of employment agreement in work contracts, those who do not want to take the package will be found work elsewhere on the site. ``This change will result in the reduction of one operating shift. The need to reduce production directly results from the ongoing lower demand from our traditional Asian markets," a BHP spokesman in Whyalla said.
``The company has consulted rolling mills employees and union over the last 12 months about the weakened market and its potential to impact the operations."
For the six months to November 30 BHP's integrated steel suffered a 25 per cent drop in earnings while steel products' earnings tumbled 38 per cent. In November the Sydney Steel Mill and Newcastle steelworks cut steel production back by 1250 tonnes a day, Port Kembla cut 1700 tonnes of production a day, Whyalla cut 300 tonnes per day and Glenbrook in New Zealand cut 200 tonnes a day.
© 1999 Illawarra Mercury
