❓ Dr. Honey questions the Minister about the closure of several major industrial operations in WA. The Minister responds by attributing the closures to global market forces and highlighting government efforts to diversify the economy and support affected industries.
AnsweredQoN 531Legislative Assembly
QuestionView source ↗
STATE ECONOMY — DOWNSTREAM MANUFACTURING
531. Dr D.J. HONEY to the Minister for State and Industry
Development, Jobs and Trade:
During the minister's term
of government, we have seen three foundational industries in the Kwinana and Rockingham industrial areas close down or announce
closure this year, being the BP oil refinery, the Alcoa Kwinana alumina
refinery and the BHP nickel refinery. In addition, BHP has announced the
mothballing of its entire nickel business, and now Albemarle in Kemerton has announced
the shutdown of its second production train with major job losses.
(1) Why is the
minister's government allowing the dismantling of downstream
manufacturing in Western Australia?
(2) What actions
is the minister taking to reverse this catastrophic trend?
531. Dr D.J. HONEY to the Minister for State and Industry
Development, Jobs and Trade:
During the minister's term
of government, we have seen three foundational industries in the Kwinana and Rockingham industrial areas close down or announce
closure this year, being the BP oil refinery, the Alcoa Kwinana alumina
refinery and the BHP nickel refinery. In addition, BHP has announced the
mothballing of its entire nickel business, and now Albemarle in Kemerton has announced
the shutdown of its second production train with major job losses.
(1) Why is the
minister's government allowing the dismantling of downstream
manufacturing in Western Australia?
(2) What actions
is the minister taking to reverse this catastrophic trend?
AnswerView source ↗
(1)–(2) I never thought I would find myself in the position
of explaining how the market works to a former Leader of the Liberal
Party, but alas. Something we are used to on this side is explaining to the
Liberal and National Parties how the world actually works. We know that,
particularly in the lithium industry, prices have fallen significantly since
the peaks of 2022, largely off the back of rising global lithium supply and
falling demand. The projections of lithium demand, particularly in the United
States, have not been as strong as market leaders anticipated.
The challenges faced by our lithium
industry highlight the volatility of global commodity markets and reinforces
the importance of my government's work to diversify the economy and
build resilience into the resources sector. That is what we should be doing and
that is what we are doing. It is about making sure that our economy can ride
out the ebbs and flows of the resources industry. We are seeing changes in the
market at the moment in relation to the iron ore industry, and, of course,
nickel is suffering from difficulties related to oversupply at the moment.
Western Australia is a global market
trade-exposed economy. We cannot just simply wish those global market conditions
to go away or to change. We have to make sure that we understand them, continue
to diversify the economy and assist industry to do whatever it needs to ride
out these fluctuations. We all know that royalty relief is not the silver
bullet for worldwide battery metal demand not hitting where we thought it
would. The Minister for Mines and Petroleum continues to work with industry to
understand its challenges and to employ whatever policies we can to assist it.
In May, we released our refreshed Western
Australia's battery and critical minerals strategy 2024–2030 to help guide future investment as the state continues its push to become a major
global player in the downstream processing of critical minerals. The Cook
government will continue to support global green steel and critical minerals
processing industries to drive the diversification of WA's economy to
create long-term local jobs and set up our state for the long term.
We cannot simply wish global market
conditions to go away. There are a range of things we can do. We are doing
them, and they are welcomed by industry. For instance, a spokesperson for
Albemarle said on 1 August that its decision had ''nothing to do''
with state and federal government policy, and that —
''Today's decisions
regarding Kemerton are entirely due to market conditions �''
That is the market upon which the
Liberal Party has built its entire value set. On 11 July, Nickel West said that
its decision to temporarily suspend operations —
� could not be countered by the
welcome policy interventions made by the WA and Federal governments.
There is an acknowledgement that
governments at both the state level and federal level are doing a range of
things to support these industries. However, we cannot simply wish away global
market conditions. On 16 January, the executive vice president of Alcoa said
that its decision to curtail operations at its Kwinana facility was the result
of multiple factors, not government policy. He went on to say —
''Politicisation of the matter
is an unfortunate distraction at a time when the focus should be on caring for
our people and others impacted,''
I could not agree more with that
gentleman.
Mr S.A. Millman interjected.
The SPEAKER : Member for Mount
Lawley!
of explaining how the market works to a former Leader of the Liberal
Party, but alas. Something we are used to on this side is explaining to the
Liberal and National Parties how the world actually works. We know that,
particularly in the lithium industry, prices have fallen significantly since
the peaks of 2022, largely off the back of rising global lithium supply and
falling demand. The projections of lithium demand, particularly in the United
States, have not been as strong as market leaders anticipated.
The challenges faced by our lithium
industry highlight the volatility of global commodity markets and reinforces
the importance of my government's work to diversify the economy and
build resilience into the resources sector. That is what we should be doing and
that is what we are doing. It is about making sure that our economy can ride
out the ebbs and flows of the resources industry. We are seeing changes in the
market at the moment in relation to the iron ore industry, and, of course,
nickel is suffering from difficulties related to oversupply at the moment.
Western Australia is a global market
trade-exposed economy. We cannot just simply wish those global market conditions
to go away or to change. We have to make sure that we understand them, continue
to diversify the economy and assist industry to do whatever it needs to ride
out these fluctuations. We all know that royalty relief is not the silver
bullet for worldwide battery metal demand not hitting where we thought it
would. The Minister for Mines and Petroleum continues to work with industry to
understand its challenges and to employ whatever policies we can to assist it.
In May, we released our refreshed Western
Australia's battery and critical minerals strategy 2024–2030 to help guide future investment as the state continues its push to become a major
global player in the downstream processing of critical minerals. The Cook
government will continue to support global green steel and critical minerals
processing industries to drive the diversification of WA's economy to
create long-term local jobs and set up our state for the long term.
We cannot simply wish global market
conditions to go away. There are a range of things we can do. We are doing
them, and they are welcomed by industry. For instance, a spokesperson for
Albemarle said on 1 August that its decision had ''nothing to do''
with state and federal government policy, and that —
''Today's decisions
regarding Kemerton are entirely due to market conditions �''
That is the market upon which the
Liberal Party has built its entire value set. On 11 July, Nickel West said that
its decision to temporarily suspend operations —
� could not be countered by the
welcome policy interventions made by the WA and Federal governments.
There is an acknowledgement that
governments at both the state level and federal level are doing a range of
things to support these industries. However, we cannot simply wish away global
market conditions. On 16 January, the executive vice president of Alcoa said
that its decision to curtail operations at its Kwinana facility was the result
of multiple factors, not government policy. He went on to say —
''Politicisation of the matter
is an unfortunate distraction at a time when the focus should be on caring for
our people and others impacted,''
I could not agree more with that
gentleman.
Mr S.A. Millman interjected.
The SPEAKER : Member for Mount
Lawley!
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