CCP Trade Tactics Could Devastate Australian Towns, Cost 73,000 Jobs: Report

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Small Australian towns could be eviscerated if the federal government does not take steps to curb an ongoing CCP strategy to flood global markets with cheap commodities.

That’s the message from the McKell Institute, with its latest report laying bare the consequences if Chinese mineral refining practices are allowed to continue unchecked.

McKell warns “deliberate geoeconomics interference” from Beijing could impact 73,000 Australian jobs dependent on metal manufacturing and refining—the industry directly employs around 55,000 workers.

“Australia is experiencing the repercussions of a geoeconomics strategy by China, crafted to undermine the industrial foundations of rival economies while establishing China as the central hub of the global industrial landscape,” the report states.

By boosting its own capabilities through subsidies and saturating global markets with its own cut-price products, the Chinese Communist Party (CCP) can undermine competing sectors—forcing the eventual closure of mines and refineries.

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This will create a cascading effect where Western democracies lose vital workers, skills, and industry sectors. Eventually, when the competition dwindles, Beijing will be dominant market leader.

“This interference is destabilising and, over time, threatens to weaken the industrial base of strategic rivals, including Australia and other regional and global economies,” the report says.

“Such a shift could ultimately hinder competitors’ ability to produce arms and heavy machinery.”

Population Loss from Aussie Towns

McKell’s Cavanough also says its not just the job losses that are an issue, smaller towns that revolve around mining or smelting operations will likely be devastated.

“Our analysis shows that if the Port Pirie smelter were to close, the town’s population could drop by around 2,000 people—that’s 11 percent —in the first year alone,” he said.

“These would be the town’s most economically productive residents leaving with their families.

“South Australia simply cannot afford to lose industrial anchors such as the Port Pirie smelter—anchors that have sustained regional communities for generations.”

The report also estimates the town of Whyalla could lose 11.4 percent of its population (5,349 people), Mount Isa 3.9 percent (881 people), and Port Kembla 3.3 percent (10,698 people—the area is part of the greater Wollongong area).

Australia Playing Whack-A-Mole

Like dominoes, Australian policymakers have spent recent weeks shoring up collapsing refiners and processing facilities.

This week the Labor government announced $50 million to assist lithium miner Liontown, and a $135 million rescue package for Nyrstar’s facilities in Hobart and Port Pirie in South Australia, which has been battered by a flood of cheap zinc from China.

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The Nyrstar zinc smelter in Lutana, Hobart in Australia on March 28, 2025. AAP Image/Ethan James

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Whyalla Steelworks in South Australia continues its search for new buyers, and calls continue for Labor to step in and assist Glencore’s Mount Isa and Townsville copper facilities, which face imminent shutdown.

So far, Australia’s nickel industry has largely gone into hibernation in response to mass Indonesian-Chinese nickel production. Current estimates are about 10,000 jobs have been lost or are at risk.

Where Australia is Falling Short

The McKell Institute says a holistic, nationwide strategy is needed from the Commonwealth government.

Rather than propping up individual refineries, which the report likens to playing Whack-a-Mole, Australia should look at its anti-dumping regulations to prevent large shipments of cut-price commodities entering the market.

The report also calls on Australia to limit the amount of scrap metal it exports to other markets for recycling and reuse, noting this work could be kept onshore.

McKell also says incentives to keep refining and processing onshore are essential, with portions of the National Reconstruction Fund allocated for this purpose.

The government should consider establishing an East Coast Gas Reservation policy to keep energy costs down.

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