The unit price of aluminium is more than 50 times greater than the unit price of bauxite.  Yet Australia is growing its presence at the lower-value end of this industry – while perversely shrinking its presence in an industry whose output sells for 50 times as much.  In recent years, Australia’s downstream capabilities in aluminium manufacturing (including alumina refining, smelting, and secondary fabrication and manufacturing) have been substantially deindustrialised, even as exports of raw or barely-processed resources grow. Australia is shipping billions of dollars in value-added, and many thousands of jobs, to other countries.  This would get worse, if further manufacturing facilities — such as the smelter in Portland — are permanently closed.

This report, prepared by the Centre for Future Work for the Australian Workers’ Union, describes the perverse evolution of Australia’s role in global aluminium production in recent years, including the growth of raw extraction, the decline of value-added activity, and the resulting shrinkage in net income and employment in the industry.  It also estimates the impact of the potential closure of another threatened smelter, in Portland, Victoria, on overall employment, output, exports, incomes, and government tax revenues.  The loss of another major manufacturing facility would be a significant blow, at a time when the failure of the previous extraction-dominated model of economic development has become abundantly clear.