Miners slash jobs

More than 1000 mining and construction jobs will be lost.

More than 1000 Australian mining and construction jobs are set to be lost with Rio Tinto, Caterpillar, and Iluka Resources all reporting major cuts.

Rio will cut 705 Queensland jobs as the company cuts back bauxite production at its Weipa mine and scales back on a refinery expansion project in the State’s mid-north.

Rio’s decision to slow construction of the Yarwun alumina refinery expansion in Gladstone and cut 2009 bauxite production by 22.7% to 15 million tonnes follows sharp declines in prices and demand for both alumina and aluminium.

The cuts will result in the loss of 100 permanent roles at Weipa, around 570 contract positions in Gladstone, and a further 35 permanent roles lost from the Yarwun refinery and at Boyne Smelters also in Gladstone.

Rio Tinto’s bauxite and alumina president Steve Hodgson said the current market made the “difficult decision” to cut jobs necessary.

“Even with alumina industry capacity cuts equivalent to 21 million tonnes per year since the beginning of the crisis, including cuts of 12 million tonnes made since January, there is still little improvement in the alumina price,” he said.

“At current prices around 70% of the industry is currently operating at a financial loss.

“We are strongly focused on minimising costs and conserving cash, and this work is ongoing in our operations as we continue to closely monitor market conditions.”

Weaker demand for products has also forced Iluka Resources to reduce its output.

The minerals sands miners will axe 135 jobs as it cuts its 2009 zircon production by 20% to 350,000 tonnes, and reduces the combined rutile/synthetic rutile output by about 10% to match short term demand estimates.

Like Rio Tinto, slowing demand has left Iluka with little choice but to cut production, managing director David Robb said.

“Iluka believes that in the current environment lower prices will not increase demand and the prudent course of action is to match current production to a lower estimate of forward demand,” he said.

The Sydney Morning Herald reports Federal MP Sid Sidebottom said 280 jobs from Caterpillar’s 700-strong Tasmanian workforce will be lost by the end of the month.

According to Sidebottom, Caterpillar told him “280 workmen would be losing their jobs in the next couple of weeks.”

“These job losses are quite devastating for the area but it’s a very resilient region with a diversified economy,” Sidebottom said.

Caterpillar announced in January that the construction and mining equipment manufacturer would be cutting 20,000 worldwide jobs in an effort to cuts costs.

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