Stephen Jones (Whitlam, Australian Labor Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

Australia's the largest exporter of iron ore in the world. It's an essential component in steelmaking. As a result, we have benefited from the fact that the modern world is built on steel. It's the second-most abundant man-made substance on earth, after concrete. Around 1.8 gigatons were produced last year alone. It's importance to the Australian economy can't be underestimated. It's worth about $29 billion and employs literally tens of thousands of Australians. Australia has five steel mills, and they make about 5.5 million tonnes of steel a year. The largest, in my hometown of the Illawarra, produces roughly half of that—big by national but not by international scale. We produce less than two per cent of the steel that is produced globally. China produces about half of the steel in the world.

Nonetheless, our domestic steel industry is a vital part of the supply chain for so many local industries. It's a key supplier to residential and commercial construction industries. The local saying goes: where goes a building boom goes a steel boom. There's a lot of steel in a modern residential development. It's used to make grain silos on farms, electrical transformers for our rail network, girders and pipes for major civil projects, and bearings and brake components for the vehicle component industry. It's a major supplier to the Australian naval defence industry. The value of having a domestic steelmaking capacity onshore here in Australia cannot be overstated. We saw during the pandemic how disruptive supply chains can be to the entire economy. That's why Labor's future Made in Australia policy and our government procurement policy are so crucial in giving the steel industry a chance to compete for even more work.

But that's just the start: the steel industry needs to deal with the climate change and energy challenge, as every other business in the economy does. The steel industry is well versed in dealing with these challenges. In my lifetime there have been three challenges and significant shocks in the steel industry alone. It knows it has a central role in decarbonising its industry—and, as a result of that, the economy—and in driving the process and technologies that will lead to cleaner production. From wind turbines to electric vehicles, steel will be a critical and integral part of the energy transition. It also has a role to play in bringing down its own emissions. This is because steel is a major source of greenhouse gas emissions. The industry accounts for seven per cent of all global greenhouse gas emissions from the energy system—equal to global aviation, shipping and chemical emissions combined.

BlueScope—the biggest employer in the steel industry in my electorate in the Illawarra—is aware of the challenge. It has committed to net zero emissions by 2050. So has its predecessor, BHP. The steel industry has started down the path to decarbonise its business, but it cannot do it alone. It needs a reliable source of large quantities of renewable energy; it needs a power grid which is capable of hooking that energy source up to the emerging steelmaking technologies; and it needs a government which is committed to action, not just a slideshow. It needs a national climate change policy that encourages investment and maintains competitiveness and ensures a viable industry for decades to come. Let me explain why.

There's been a lot of talk in this place about the capacity for green steel. It's not a term used by the people who make steel, by the way. They know that it's red, brown or grey—but never green. But we know what proponents of green steel mean. They mean decarbonising the steelmaking process. There are exciting developments going on overseas, but the glide path to decarbonise steel is probably about 15 years away. In the meantime, we need to ensure that we have a viable steel industry in Australia. The steps towards decarbonised steel are not going to be one big step but lots of little ones, and to achieve that we need certainty in government policy and ongoing support and this parliament, the state parliaments and the local councils around the country to say: Australia doesn't want to just be the people who dig dirt up and send it overseas; we want to continue to make steel here.