Administrator cuts 500 jobs at broken Whyalla blast furnace

By Caleb Reed · 2026-09-15

Furnace declared beyond repair

Administrator KordaMentha confirmed on 14 September 2026 that the blast furnace at the OneSteel Manufacturing Whyalla Steelworks will never restart, bringing all iron production to a permanent end at a facility that has operated on the South Australian coast for six decades.^[1] KordaMentha was appointed administrator of OneSteel Manufacturing Pty Ltd, the owner and operator of the steelworks and its associated mining operations.^[2]

Blast Furnace No. 2 was commissioned in 1965, relined in 1981 and again in 2004, and ran continuous iron production until it was suspended in April 2026 amid irreparable structural damage. South Australian Minister for Energy and Mining Tom Koutsantonis said the workers had done everything possible. "The blast furnace was originally commissioned in 1965 and is at the end of its life, hastened by a lack of appropriate investment by the previous owner. The workers of OneSteel have done a heroic job trying to revive it, but all advice now points to the fact that it will not restart," Koutsantonis said.^[2]

Jobs toll

About 500 direct employees face redundancy from a total Whyalla workforce of 1,700, with a further 100 labour hire workers and roughly 200 embedded contractors in uncertain positions.^[1]

Mining, port and other process operations continue on the OneSteel Whyalla site, supplying iron ore and stockpiles for steelmaking while the sale process runs.^[1] Premier Peter Malinauskas said the closure, while painful, was unavoidable. "This is a difficult day, but one which is inevitable. The blast furnace at Whyalla is 60 years old and for many years has not had the investment it deserves through recent decades," Malinauskas said.^[2]

Government support and the sale race

The Albanese and Malinauskas Governments announced a joint $10 million support package for Whyalla workers, their families and the broader community.^[2] Redundancy costs across the affected workforce are estimated at $60 to $80 million, leaving a gap between what workers are owed and what governments have committed.^[1]

The administrators shortlisted Jindal Group and M Resources as the two final bidders to acquire the steelworks, with BlueScope Steel retaining a right of final offer.^[3] Both shortlisted bidders are proposing to convert Whyalla to a low-emissions direct-reduced iron and electric arc furnace facility under the Commonwealth and South Australian governments' $1.9 billion sovereign steel commitment.^[3]

A preferred buyer is expected to be announced before year's end, with the governments' $1.9 billion commitment contingent on a new owner proceeding with the low-emissions conversion.^[3] The sale process carries a target of completion within 18 months of the administration intervention, pointing to a close before the end of 2026.^[4]

Caleb Reed

Caleb Reed covers breaking news and sport. He works to the rhythm of a story as it unfolds, and he is happiest when the facts arrive faster than anyone can spin them.