Report highlights Australian aluminium industry’s economic impact and need for urgent action
A new report reveals Australia’s aluminium sector generates billions for the economy, but it faces risks without stronger policy support and streamlined regulations.
Australia’s aluminium industry, one of the largest and most integrated in the world, is facing critical challenges that require immediate attention, according to the Australian Aluminium Council. The Economic Contribution of the Vertically Integrated Australian Aluminium Industry report found the industry is a key player in the country's economy, contributing over A$18 billion annually and supporting around 20,700 direct and 55,000 indirect jobs, predominantly in regional areas. However, supply chain vulnerabilities and regulatory delays are putting its future at risk.
Australia is a rare nation with a complete aluminium supply chain, from bauxite mining to downstream processing. The sector’s structure provides an advantage in terms of stability and economic contribution, but it also creates unique challenges, especially in light of the energy transition and increasing global competition.
“Australia is one of the very few countries anywhere in the world with a complete mine-to-market aluminium supply chain,” said Aluminium Council CEO, Marghanita Johnson. “It’s a remarkable achievement by generations of Australians but their legacy is now at risk from disruptions and interruptions caused by the challenges in the energy transition, uncertain environmental approvals, and uneven global competition.”
The report includes modelling of a potential closure of a single bauxite mine in Western Australia. It found that such an event could result in the loss of 10,000 indirect jobs and reduce Australia’s GDP by A$2.7 billion. These risks make it clear that immediate policy changes are needed to safeguard the industry's future.
To help the aluminium sector remain competitive, the report recommends four key actions:
- Simplifying environmental approvals: Regulatory processes across jurisdictions need to be faster, clearer, and more consistent. This would ensure the country’s bauxite resources are economically viable and help speed up the development of essential infrastructure for the energy transition.
- Supporting decarbonisation and energy planning: A coordinated national approach is required to manage the energy needs of the industry, particularly as it moves towards the production of green metals that are crucial for renewable technologies such as electric vehicles and solar panels.
- Adding aluminium to the critical minerals list: This would reduce red tape, attract international investment, and boost funding for decarbonisation initiatives. Bauxite, alumina, and aluminium should be included in Australia's critical minerals strategy to ensure the sector’s long-term competitiveness.
- Maintaining strong trade protections: Measures to prevent dumping and unfair subsidies are vital for Australian manufacturers to compete globally. The report calls for investigations into anti-circumvention practices, which threaten the ability of local producers to compete.
Johnson stressed the industry's long-term importance, stating, “Aluminium is vital to Australia’s economy and a critical component of green technologies like solar panels, electric vehicles and batteries.” The sector's pay rates are 60% above the national manufacturing average, contributing to local economies, especially in regional areas.
Australia’s aluminium industry, which has been operating since 1955, is the largest producer of bauxite and the largest exporter of alumina globally. The report highlights that with the right policy settings, the sector can continue to thrive, contributing to the country’s economic and industrial landscape.
