Australia’s aluminium industry, a cornerstone of the nation’s economy, is at a critical juncture as it navigates the global energy transition.
A new report by the Australian Aluminium Council highlights the sector’s significant economic contribution while emphasising the urgent need for government action to secure its future.
The vertically integrated aluminium industry contributes $18 billion annually to Australia’s economy and supports over 75,000 jobs, with 20,700 direct and 55,000 indirect positions.
These jobs, predominantly located in regional areas, offer pay rates 60 per cent above the national manufacturing average.
However, the industry faces significant challenges.
Marghanita Johnson, CEO of the Australian Aluminium Council, warns: “Australia is one of the very few countries anywhere in the world with a complete mine-to-market aluminium supply chain.
“It’s a remarkable achievement by generations of Australians but their legacy is now at risk from disruptions and interruptions caused by the challenges in the energy transition, uncertain environmental approvals, and uneven global competition.”
The report underscores the sector’s vulnerability to supply chain disruptions.
A hypothetical scenario modelled in the study suggests that the closure of a single bauxite mine in Western Australia could result in the loss of 10,000 indirect jobs and reduce Australia’s GDP by $2.7 billion.
To address these challenges and secure the industry’s future, the report recommends four key actions:
- Streamlining environmental regulatory processes across jurisdictions.
- Providing targeted support for decarbonisation and energy transition planning.
- Adding bauxite, alumina, and aluminium to Australia’s critical minerals list.
- Maintaining robust international trade remedies to protect against unfair practices.
Johnson emphasises the industry’s importance in the green technology supply chain, stating, “Aluminium is vital to Australia’s economy and a critical component of green technologies like solar panels, electric vehicles and batteries.”
With annual export revenue exceeding $15 billion, the aluminium industry plays a crucial role in Australia’s economic landscape.
The report argues that with the right policy settings and cooperation between government and industry, Australia can maintain its position as a world leader in sustainable aluminium production and innovation.
As the global demand for green technologies continues to grow, the Australian aluminium industry stands at a crossroads.
The implementation of these recommendations could determine whether the sector can capitalise on the opportunities presented by the energy transition or face decline due to increasing global competition and regulatory challenges.
