Nyrstar, a leading international metals producer, will receive a $135 million bailout package. The federal, South Australian, and Tasmanian governments have agreed to support. This package aims to stabilise Nyrstar’s operations at Port Pirie and Hobart and address financial challenges threatening jobs and production in both cities.
Bailout Structure and Funding Details
The Australian Government will provide $57.5 million. The South Australian Government will commit $55 million. The Tasmanian Government will invest $22.5 million. These funds will allow Nyrstar and its parent, Trafigura, to maintain operations while planning engineering upgrades. The Company earmarked the investment for critical maintenance at the Port Pirie lead smelter and significant projects at the Hobart zinc smelter, including furnace and wharf upgrades.
Nyrstar’s CEO Guido Janssen described the funding as timely support during “extremely challenging global market conditions”. He noted the strategic significance of Nyrstar’s Australian operations for sovereign capability and global supply of essential metals. Trafigura CEO Richard Holtum stated the investment would keep both sites viable for the foreseeable future and highlighted the importance of sustaining domestic capability.
Nyrstar’s CEO Guido Janssen described the funding as timely support
Strategic Upgrades and Future Production
The Company will use some of the funds for feasibility studies into new critical metals production. Plans include expanding output to antimony and bismuth at Port Pirie and germanium and indium at Hobart. The Port Pirie project involves a pilot plant for antimony production, a metal vital for munitions and electronics. Holtum said, “The fact that this site can produce 40 per cent of all the antimony required by the United States for critical tasks such as the hardening of bullets demonstrates the vitalness of these sites … and the absolute importance of Pirie and Hobart.”
Federal Industry Minister Tim Ayres indicated that the funds would underpin the first phase of a two-year feasibility study to expand metals production. He said the funding would extend “well into” the first half of 2026, modernising Port Pirie’s plant and building future capability. Nyrstar employs 1,400 people directly in Australia and supports 6,600 indirect jobs, reinforcing the plant’s economic weight.
An overhead view of Nyrstar’s Port Pirie lead smelter
Repurposed and Additional Funding
Federal cabinet minister Julie Collins clarified much of the funding derives from previously announced commitments. She stated, “$50 million of the $57 million federal contribution had been announced in 2022 for an electrolysis plant at the Hobart zinc smelter. That is being repurposed and we’re adding an additional $7.5 million.” The Tasmanian Government’s $20 million commitment has been repurposed and increased by $2.5 million to meet current priorities.
Financial Struggles and Market Pressure
Nyrstar’s financial challenges have intensified in 2024. CEO Matt Howell said in June that Port Pirie was losing tens of millions of dollars each month, warning of the urgent need for government action. Company officials also confirmed the Hobart zinc smelter could not run independently if Port Pirie closed. In March, Trafigura’s global management identified Nyrstar Australia as an “uncompetitive asset” unsuitable for exclusive private management.
Trafigura’s Holtum noted the Company would match government investments at both sites and cover operational losses during the feasibility phases. The Hobart smelter, which employs over 500 workers, reduced output by 25 percent in April. Australian Workers Union Tasmanian assistant secretary Robert Flanagan reported no indication that the reduction would be lifted soon.
Lead product at Nyrstar’s Port Pirie smelter site
Market Conditions and Global Factors
Nyrstar attributes its difficulties to market distortions from China. Company leaders have pointed to Chinese subsidies for acquiring Australian raw materials and processing them into finished metals, making it hard for Australian plants to compete. Rebecca Knol from the South Australian Chamber of Mines and Energy described how China’s long-term concentrate contracts have driven up feedstock prices for domestic operators.
South Australian Premier Peter Malinauskas framed the government intervention as essential. He said, “One also has to think about the counterfactual. The counterfactual would be to allow the western world to see China consolidate all of its smelting capacity, all of the world’s smelting capacity, which means we don’t get to participate in the … critical mineral supply chain of the future. That’s an unacceptable risk, particularly in the current geostrategic environment.”
Also Read: Western Australia Advances Green Technology and Energy Transition with New Initiatives
Site Projects and Upgrades
The Port Pirie smelter refines lead, silver, zinc fume, copper matte, and by-products such as sulphuric acid. The Hobart facility produces zinc and by-products including copper sulphate, cadmium, gypsum, and sulphuric acid. The $135 million will fund essential plant maintenance at Port Pirie and upgrades, including a state-of-the-art electrolysis plant for zinc production at Hobart. Nyrstar aims to complete design and construction at Hobart within three years.
Future Development and Pilot Projects
Nyrstar will also invest in feasibility studies for producing germanium and indium at Hobart. These minerals are vital for modern technology, including touchscreens. Howell said the Port Pirie pilot plant would soon produce up to half a tonne of antimony daily. He added, “Before the end of this nine-month … feasibility study we will have a full-size demonstration plant up and running.”
Through targeted investment and strategic planning, Nyrstar and its government backers aim to secure the Company’s future, protect jobs, and strengthen Australia’s position in global metal production.
