• $1 Billion Green Iron Investment: Australia commits A$1 billion ($636 million) to boost green iron manufacturing and supply chains.
• Whyalla Steelworks Bailout: A$500 million allocated to transform and sustain the Whyalla steelworks, preserving local jobs.
• Economic & Environmental Strategy: The fund aims to secure future demand for Australian iron ore and drive global decarbonization.

Australia’s Green Iron Push

Australia on Thursday unveiled a A$1 billion ($636 million) Green Iron Investment Fund to support green iron manufacturing and its supply chains, including an initial A$500 million to rescue the Whyalla steelworks in South Australia.

On Wednesday, South Australia’s premier placed Whyalla into administration for unpaid bills, emphasizing the state’s ambition to develop lower-carbon steel production. The A$500 million is part of a larger A$1.9 billion state and federal package to stabilize the GFG Alliance-owned steel plant.

“Investment in green iron and steel will secure future demand for Australia’s iron ore as the world moves toward lower-emissions iron and steel,” said the Department of the Prime Minister.

Strategic Economic Impact

Australia, the world’s largest iron ore producer, earned over A$100 billion in export income in 2023-24. The broader iron and steel sectors support more than 100,000 jobs.

A key element of the Labor government’s Future Made in Australia policy is leveraging the clean energy transition to drive manufacturing growth and add value to critical minerals.

According to The Superpower Institute, green iron and steel opportunities could be worth up to A$400 billion. Additionally, a single green iron plant could add $85 billion to GDP and create over 1,500 full-time jobs, according to the Minerals Institute of Western Australia.

Related Article: Nippon Steel to Start Making Low-Carbon Ingredients for Green Steel

Whyalla Steelworks & Broader Ambitions

The Whyalla steelworks bailout will help transform the site into a hub for green iron and steel, safeguarding local jobs and supporting South Australia’s roadmap to green iron. The site offers a strategic advantage with access to a deep-water port, high-grade magnetite ore reserves, and renewable energy.

At least A$500 million of the fund will be available nationwide for green iron projects, targeting both existing facilities and new developments.

Companies such as BHP, Rio Tinto, and BlueScope Steel are already exploring low-carbon iron production from Pilbara ores. Emerging green iron technology players include Calix, Element Zero, and the Helios Project.

Government’s Broader Green Initiatives

The Albanese government is bolstering Australia’s green metals sector with:

• $2 Billion Investment: In Australian-made aluminium.
• Production Tax Credits: For hydrogen and critical minerals, despite opposition from the Liberals and Nationals.
• Major Critical Minerals Projects: Through the Critical Minerals Facility, including investments in Iluka and Arafura.
• $3.4 Billion in Geoscience Australia: To accelerate resource discovery.
• Funding for Hydrogen Headstart: To drive Australia’s hydrogen and clean energy industries.

Prime Minister Anthony Albanese emphasized, “This fund will not only create jobs but also support global emissions reduction at a massive scale.”

The Big Picture

With elections looming by May, the Labor government is positioning Australia as a green iron powerhouse, aiming to secure its market share in the global steel supply chain amidst increasing competition.

The initiative reflects a dual strategy: strengthening the domestic economy and contributing to global decarbonization by tapping into the surging demand for low-emission iron and steel products.

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