Whyalla Steelworks' Blast Furnace Closure Sparks Uncertainty for Locals

The closure of the blast furnace at Whyalla's steelworks has brought uncertainty to locals, despite union officials and the mayor describing the community as "stubbornly determined" and resilient.

"I just use the term 'stubbornly determined'," AWU organiser Shane Karger said. "We've had a rough end of the stick for quite a few years now, you know, just over 10 years and we've never given up. We're still not going to give up."

The blast furnace closure, which was announced by the government, hasn't come as a surprise to locals — workers have been pushing to get the 60-year-old plant back online since April.

Mayor Phill Stone said it was a sad day for Whyalla, but it would allow people to move forward. "Our community, in some respects, will breathe a sigh of relief that this announcement has been made," he said. "This is essential. There is no other way out other than to close the blast furnace and we as a council and the government and our community, I believe, will pull together to ensure the minimal impact on those that are going to suffer."

The Whyalla steelworks is Australia's biggest manufacturer of structural steel, used for rail lines, bridges and industrial buildings. The loss of the blast furnace is the latest blow to an industrial city that's become used to hard knocks.

Whyalla began as a mining settlement at the turn of the 20th century, when BHP began mining nearby iron deposits. The first blast furnace was built in the late 1930s, and as Australia went to war, BHP added a shipyard.

The shipyards saw Whyalla boom, and in 1976 it was South Australia's biggest regional city with a population of 33,000 and a plan to expand to 100,000. But in 1978, the last ship was built in the city.

The closure of the shipyards resulted in a rapid population decline, with current numbers down to just more than 21,000. Despite the end of shipbuilding, the steelworks kept going and became the city's largest employer.

However, the steelworks has struggled through a decade of financial problems and uncertainty. In 2016, owner Arrium collapsed into voluntary administration. A saviour came in the form of British billionaire Sanjeev Gupta, who promised to keep local jobs and even add to them.

His pledge came with a projection of population growth to 80,000, as Mr Gupta said he would build a "next-gen mega steel plant" that would be one of the biggest in the world. But Mr Gupta's global operations began to struggle following the collapse of his key lender, Greensill Capital.

In 2025, the South Australian government took the extraordinary step of forcing the steelworks into administration. It was celebrated as a move to save the steelworks, with hopes it would turn the plant's fortunes around.

"Workers at the steelworks itself, they will now have their futures assured," Premier Peter Malinauskas said at the time. "They're in a situation now where they're not going to wake up tomorrow and the administrator is making people redundant."

But the blast furnace closure will now reduce the workforce from 1,700 to 1,200. Workers have been pushing against the odds to restart the aging blast furnace since April.

There are two bidders to take over the steelworks, and the state government says that process remains on track despite the blast furnace closure. It's expected the winner of that bidding process will be announced by the end of the year.

Local businesses are worried the economy will suffer, with some locals losing confidence. Cafe worker June Worsnop said job losses would bring uncertainty to the local economy and residents. "Everyone is going to stop spending money, they're going to be scared," she said. "All this money they've put into the plant, what for?"

"I know this could be the crunch and if so, what, we'll end up being a welfare town?"

Darryl Durdin owns a local scaffolding business and says he's now facing possible closure. "Here I am on the outside, looking in, I'm watching it implode," he said.

But Mr Durdin is holding on to some hope, and says it is "possible" his business could hang on until a new buyer has taken over the steelworks. "If you lose hope, you've lost everything," he said. "I'm shrewd with my money, I never waste my money, things like that. You've just gotta do what you've gotta do to hang in there."