New Zealand Steel restructure puts 200 jobs on the line

New Zealand Steel's Glenbrook Mill south of Auckland. Photo / Greg Bowker

By RNZ

New Zealand Steel is to restructure its business with the likely loss of up to 200 jobs, but maintain steelmaking at its Glenbrook mill.

The Australian owner of the mill, Bluescope, signalled in May it was reviewing the future of the loss-making business because it was not paying its way.

Chief executive Gretta Stephens said the mill would keep making its top-selling Colorsteel, but loss-making products would be cut and other operations changed.

"We are proposing to change the mix of products and continue our focus on reducing costs to become a leaner and more resilient business that is 'fit for purpose, fit for market'."

She said between 150 and 200 jobs may go out of the 1400-strong workforce.

Stephens said all options had been considered during the review but it needed to take action to ensure the survival of steelmaking in this country in the face of challenging conditions.

"Unfavourable public policy in relation to carbon, energy costs and trade remedies have compounded the financial pressures and the business can no longer continue in its current operating model."

The mill made an operating loss of $6.5 million (AU$6m) in the past year, and Bluescope had taken a $213.42m (AU$197m) writedown of the business in its latest results.

The business includes the steelmaking plant at Glenbrook, south of Auckland, and Pacific Steel, and it had already closed down one production unit last year.

Bluescope said last month the restructuring was expected to cost between $32-54m (Au$30-50m).

- RNZ