About 600 workers will lose their jobs after South Australia’s Whyalla Steelworks permanently shut down its blast furnace, which was neglected by its previous Indian billionaire owner.
The South Australian government took control of the steelworks from controversial businessman Sanjeev Gupta’s GFG Alliance in February 2025, and forced it into administration, triggering a $1 billion federal and state-funded funding package.
Administrators KordaMentha said at the time the steelworks was in a “state of disrepair” and was losing $1.5 million a day because it was selling goods too cheaply to another GFG-owned company, InfraBuild, which itself posted a loss of $250 million in the last financial year.
The ageing blast furnace stopped working in April, and on Monday Sebastian Hams from KordaMentha said it was “simply unsustainable to continue the blast furnace recovery, and the failure of the blast furnace is inevitable”.
Mr Hams confirmed that the workforce would be reduced from 1,700 to 1,200, with 500 steelworkers to lose their jobs, along with about 100 labour hire workers. Another 200 contractor roles are also at risk.
Labor Premier Peter Malinauskas was also present at the announcement, and pointed the finger at GFG for failing to maintain the blast furnace, which had been operating since the 1960s.
“It is an old, clapped out blast furnace that has not been well cared for or looked after, particularly by the previous owner,” he said.
Mr Malinsauskas said the federal and state governments would provide a $10.2 million transition and support package to help workers with re-skilling and re-accreditation. Workers who are made redundant will receive their full entitlements, costing another $60 million to $80 million.
When the steelworks went into administration GFG, which ran the site through subsidiary entity OneSteel Manufacturing, said it had invested billions into the business, and blamed the previous owners for leaving it not fit for purpose.
The steelworks is Whyalla’s largest employer, and produces 75% of Australia’s structural steel.
The job losses come after a Tasmanian smelter collapsed and left hundreds of workers jobless in July, just four years after it was purchased by GFG.
Administrators said the Liberty Bell Bay manganese smelter could have remained profitable if Mr Gupta had not loaned $191 million of its cash to his other businesses.
The administrators also stated that they believed the company had been operating while insolvent since May last year, months before the unsuspecting Tasmanian government gave it a $20 million loan, $14 million of which was spent on a single ore shipment that was delivered but never used.
Header image: Left, Peter Malinauskas addresses workers at the steelworks on Monday. Right, Sanjeev Gupta and wife Nicola (GFG Foundation).
