China is “playing a hard game” on the global minerals and metals market and Australian smelters need taxpayer support to “play hard back”, according to a senior union official. 

Without assistance, Australian Workers’ Union organiser Mick Hopgood said 800 jobs were at risk at the Port Pirie lead and zinc smelter in South Australia.

Worker and union delegate Grant Petagna said the regional city, 2.5 hours north of Adelaide with a population of 17,000, could become a “ghost town” if the smelter shut.

“I’ve worked at the Port Pirie smelter for 32-and-a-half years. My dad did his apprenticeship on site … my grandpas both did stints down at the smelters as well, so three generations,” Mr Petagna told 7.30.

“The Port Pirie smelter is important, not only to me, it’s important to the whole town.

The plant’s owner, Nyrstar, last year secured a $135 million state and federally funded bailout.

It’s now seeking more funding to keep its Australian operations afloat, including a zinc smelter in Hobart which employs 500 workers.

The company said the Port Pirie smelter had been losing tens of millions of dollars each month because of international competition and market distortion.

‘Governments have to invest’

Despite those losses Nyrstar’s parent company Trafigura, a global commodities giant, last year reported a $US2.7 billion ($3.7 billion) profit. 

South Australia Premier Peter Malinauskas said the company was profitable because it makes “hard-headed decisions around what is commercial and what isn’t”.

He also told 7.30 that other nations seek to harm smelting operations in Australia, but held back from specifically naming China.

“Do we want smelting capacity? If the answer to that question is yes, then governments have to invest, plain and simple.”

Taxpayer support for embattled Australian industries is part of the federal government’s “Future Made in Australia” agenda to encourage more local production and to protect jobs.

In February last year, the South Australian and federal governments announced $2.4 billion to keep the Whyalla steelworks running because of its sovereign value. Since then more than $200 million in further federal support has been earmarked. 

In October the Queensland and federal governments granted $600 million in assistance to Glencore’s Mt Isa copper smelter and Townsville refinery.

Then in March 2026 they spent a further $2 billion bailing out Rio Tinto’s Boyne Island aluminium smelter.

The Commonwealth has also promised to help the Tomago aluminium smelter in New South Wales because of high energy costs.

Prime Minister Anthony Albanese has said Australia cannot “allow ourselves to be so vulnerable that we depend upon being at the end of the global supply chains” and is working with Nyrstar on commercial arrangements in “Port Pirie and Tasmania”.

Industry Minister Tim Ayres declined 7.30’s request for an interview but a spokesman said Nyrstar’s Port Pirie and Hobart smelters were “strategically important”.

Mr Hopgood, who previously worked at the smelter, said there was too much at stake to let these assets fail.

“It’s not a matter of being able to afford it, it’s a matter of we have to do it,” he told 7.30.

Former Productivity Commission chair Michael Brennan told 7.30 that taxpayer support packages should be delivered through “well-developed frameworks with a degree of anticipation”, but “inevitably they come down to a crisis”.

“It’s always important, I think, to take a sceptical view of government propping up businesses and industrial capacity,” Mr Brennan said.

“It’s very hard to know whether we are getting value for money.”

However, Mr Brennan also said that at some point governments must make tough decisions — like former prime minister Tony Abbott did in 2013 — when his government refused to increase subsidies to Holden.

The car maker pulled out of Australia in 2017.

“There is some importance attached to avoiding a world where we are perpetually providing assistance, and that was of course the risk that did manifest with the automotive industry,” he said.

Mr Malinauskas has acknowledged that taxpayer support for metals industries cannot continue indefinitely.

“Our very clear plan in Whyalla is to support it through a transition to get it to a point where it’s able to produce steel for the country and stand on its own two feet economically and commercially,” the SA premier said.

Critical minerals to the rescue?

The first smelting operations started in Port Pirie in 1889 and it’s since grown to be one of the world’s largest multi-metals smelters. It has undergone multiple ownership changes and financial challenges.

Mr Malinauskas said he hoped Nyrstar could become self-sufficient, with a feasibility study underway to upgrade the Hobart and Port Pirie smelters, to produce sought-after critical minerals, including antimony.

“Antimony is critical to defence industries for a range of different products and there is a market for it in the US,” Mr Malinauskas said.

“There’s clearly a market for it, which is why … the meeting between the prime minister and President Trump was so critical … where antimony and the work at Port Pirie was specifically listed as part of the critical minerals partnership between our nations.”

Mr Petagna, 52, who works as an electrician at the smelter and is also a local councillor, remains optimistic about the future.

“It’s very important for the whole of Australia to get behind these sort of things,” he told 7.30.

“I know where people are coming from, saying they shouldn’t prop companies up, especially foreign-owned companies like Nyrstar. 

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