This is priceless.
Mainland Australia’s last wind tower manufacturer will be forced to mothball its plant in a major embarrassment for the Albanese government after cheap imports using heavy-polluting Chinese steel have destroyed the local industry and cast a shadow over Labor’s domestic renewables policy.
Keppel Prince has blasted the federal and Victorian governments after a long-running lack of certainty and failure to deal with heavily subsidised Asian steel imports forced the Portland-based manufacturer to close its wind tower manufacturing facility, once one of the nation’s biggest.
Keppel Prince executive director Stephen Garner singled out Climate Change Minister Chris Bowen for criticism, saying he had been to the plant and was well aware of the challenges facing local producers who are competing with China, where there are generous subsidies for producers that have crippled Australian competitors.
Local Liberal MP Dan Tehan said the government’s Made in Australia policy was “failing before their eyes”.
…“All the people are using the Chinese (towers). They want to import the things because it’s cheaper. But the quality is no good,’’ Mr Garner said.
…He also said the Victorian government, which has embraced renewables, had failed to follow through with contracts in recent years, making it even harder to survive.
At one point, Mr Garner had considered Chinese steel but it was being offered at double the price of that being given to his overseas competitors.
…“For many, many years I feel like I’ve been the pied piper,’’ he said. “I’ve been standing on a soap box preaching this for so long, that China has been subsidised. We know that (in) China the government gives a 12 per cent subsidy for every tower that they export.
The are many issues here:
- There is no industry policy.
- Australia produces roughly three-quarters of its steel from blast furnaces, which can’t compete with dumped Chinese steel.
- The other quarter is electric-arc furnaces run on exceedingly expensive power thanks to the gas cartel.
This is no surprise. The same thing will happen to Albo’s Made in Australia solar panels rubbish.
It will be nothing more than an assembly plant of Chinese manufactures that will go out of business the moment subsidies are dropped owing to much higher labour costs.
The answer is not subsidy or bailout; it is to fix policy and market structure:
- Get an industry policy that includes preferred local supply to the government.
- Fix the gas cartel to lower energy costs.
- Quality control behind the border where it is necessary.
- Slash immigration to lower interest rates and currency.
- Use macroprudential policy to ensure land prices fall.
- Train local labour.
This does not guarantee that wind tower manufacturing will survive, but it does mean Aussie manufacturing will be cost-competitive and stop shrinking.
