Miner and steel maker Arrium is cutting 20% of its workforce at its Waratah site in Newcastle.
In a presentation released today, the miner stated that it will ‘right size’ production and cost base for demand at the site, leading to a workforce reduction of approximately 120 people at its Waratah site.
It will carry out the cutback in June this year.
According to the company this restructuring is due to its new Cilegon facility in Indonesia becoming fully operational in the June quarter.
Previously the shortfall in capacity at Cilegon was met by Waratah.
This was compounded by a lower demand for rail wheels and lower steelmaking requirements.
Arrium stated that this will generate labour savings of $14 million annually, after an initial restructuring cost of $15 million.
However the company has seen a growth in its mining consumables division, and predicting continued development in the sector.