The heavy industry city of Wollongong in NSW continues to be hit with job losses as another steel plant is set to close.
Loss-making steelmaker OneSteel, on Thursday announced its manufacturing plant at Kembla Grange would cease operations on May 31, as the company looks to cut costs.
OneSteel, which recently reported a $74 million first half loss, is under pressure from the strong Australian dollar and high raw material prices.
The OneSteel Oil and Gas Pipe business employs 56 people, manufacturing and selling up to 50,000 tonnes of pressure pipe to the oil and gas, and steel markets in Australia each year.
"The company has been keeping the employees of this business aware of its challenges for some time and will continue to provide support and assistance leading up to its closure," OneSteel said in a statement.
It is the third recent closure of a steel plant in the Port Kembla area.
BlueScope has shut ts number six blast furnace at Port Kembla, resulting in 800 job losses, and Orrcon's large pipe manufacturing plant at Unanderra, which employed 47 people, was closed in September.
OneSteel's closure comes less than a month after it flagged up to 430 job cuts from its manufacturing businesses in order to save about $90 million.
The company will take a $13 million writedown on its distribution segment as a result of the Oil and Gas Pipe closure plus $5 million in pre-tax costs.
Those charges will be included in the company's results for the six months to June 30.
But if OneSteel is successful in selling the plant, its equipment and related land, the loss on the closure could be reduced.
OneSteel shares were up 2.5 cents at $1.19 on Thursday.
