URGENT UPDATE: Molycop has just announced it may close its Newcastle operation, threatening the loss of 150 jobs as a result of competitive pressures from undervalued Chinese train wheels. The company is calling on the Anti-Dumping Commission (ADC) to take swift action to prevent this closure, which could devastate the local economy.
The Newcastle facility, which injects $40 million annually into the Waratah-based region, previously lost 250 jobs in September 2023 due to similar issues surrounding cheap steel imports from China. Molycop continues to produce essential steel products, including train wheels, axles, and fasteners, yet the threat of closure looms larger than ever.
In a letter to Regional Transport Minister Jenny Aitchison, Molycop’s general manager for rail, Gregor Dalziel, expressed grave concerns about the impact of using Chinese-made wheels on parts of the Sydney Trains fleet. He stated that this shift has drastically reduced demand for locally manufactured wheels, despite existing supply agreements.
“This isn’t a cry for subsidies – far from it. It’s about ensuring fair competition,”
Dalziel emphasized. He highlighted that Chinese manufacturers operate at costs more than 30% lower than their Australian counterparts, often supported by government policies that distort fair market conditions.
Molycop’s ongoing battle against foreign dumping is critical not just for its operations but for the broader Australian manufacturing landscape. The ADC is currently investigating 23 cases of unfair pricing in various sectors, including steel and aluminum, with 15 cases linked to China.
Meanwhile, Industry Minister Tim Ayres has urged the ADC to remain vigilant against the influx of Chinese goods, warning that the rapidly changing geostrategic environment could harm local industries. He emphasized the necessity of a level playing field for Australian producers to thrive.
As the situation develops, Molycop is advocating for the state government to align all fleet maintenance contracts with local procurement objectives. The stakes are high, and the future of the Newcastle operation hangs in the balance.
What comes next for Molycop and its Newcastle facility remains uncertain, but the immediate focus is on securing fair competition and protecting Australian jobs. Stay tuned for further updates on this critical issue as it unfolds.
