One of the state’s most experienced mineral processors says Queensland is at a crossroads in its manufacturing development.

Referring primarily to the closure of Glencore’s Mount Isa Copper Operations and the reported rough road faced by Townsville-based Sun Metals zinc refinery, director of Core Resources Jon Loraine said the goal posts had shifted.

Main Image: Copper Refineries Townsville

It applied by extension to the temporary closure of BHP’s Nickel West plant and the Whyalla Steelworks‘ trading difficulties, with Mr Loraine saying the trend represented an epoch in economic development.

They had been taken for granted, he said.

“We’re no longer a country with cheap land, cheap power, cheap labour, cheap capital costs where we can do bulk mineral processing. And also, you’re faced with very aggressive competition around the world, not at least from China. 

“The nature of supply chains have (also) changed a lot. So there’s an increasing situation around the world where mineral processing is part of a total supply chain, not just acting independently of a supply chain. 

“Many manufacturers and producers of finished products are trying to go back upstream and control their entire supply chain.

“So they may not really care at the end of the day how much it costs to smelt their copper or their zinc. What they want to do is actually have control of the entire supply chain.”

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The cost of smelting in China was between zero and $20/tonne and in some cases, the smelters were paying mines to processes their concentrate, Mr Loraine said.

It was an impossible situation and if the public wanted to keep processing plants they would need to be subsidised, he said.

“They’re going to find it very hard to survive because they’re competing against competition that is part of these fully integrated supply chains. I mean the Chinese actually don’t really care how much it takes, how much it costs to refine copper. 

“What they want to do is control the entire supply chain. Now in the west, there’s a lot of talk about trying to get transparent, secure supply chains that are not controlled by China. 

“But so far, no one’s actually said they’re prepared to pay any premium for robust independent supply chains that aren’t shackled to China.”

Glencore is expected to announce the future of the Mount Isa copper smelter in the first quarter of the financial year.