Editorial: Premier and PM: help business thrive

In the end, BHP wasn’t left with much of a choice.

A glut of cheap supply from Chinese-backed mines in Indonesia had wreaked havoc on global nickel prices.

At the start of 2023, nickel was fetching $46,000 a tonne. That’s fallen back to just $25,000 today.

That price collapse meant it simply wasn’t feasible enough for BHP to keep its WA Nickel arm operating.

And so the difficult decision has been made to mothball its assets.

The good news is that BHP say they’re committed to doing right by WA Nickel’s 3000 employees.

BHP Australia president Geraldine Slattery said every frontline employee of Nickel West will be offered another job with the Big Australian. Best efforts will also be made to find new jobs for others involved in the group’s operations.

And they’re not dusting their hands and walking away from nickel altogether.

BHP will spend $450 million a year keeping Nickel West on care and maintenance, in the hope that conditions will improve enough to make its operation viable again.

It’s hoped that increasing demand from electric car manufacturers will soak up enough of the extra supply for doing so to be profitable.

BHP has also pledged to establish a $20 million community fund “to support local communities” during the suspension, which will be reviewed after February 2027.

As far as mine closures go, it’s a textbook example of what can be done to soften the impact.

But there’s only so much that they can do. There’s no doubt that the towns and communities that are home to WA Nickel’s assets will suffer as a result, and as will its associated satellite industries.

While BHP has a responsibility to do right by its workers and its communities, some of the burden will also fall on governments.

Premier Roger Cook on Thursday said his Government would “do whatever it takes to support those workers and our regional communities” affected.

BHP’s operations are just one in a number of nickel miners which have announced plans to close or scale down production.

A recent report by the Chamber of Minerals and Energy of Western Australia has found up to 10,000 WA nickel jobs were at risk because of the price volatility.

WA’s mining industry, and the men and women who work within it, are extraordinarily resilient.

But as the example of nickel shows, no industry is immune to changing economic circumstances, often driven by global factors out of their control.

History has proven that booms — even the really good ones — are inevitably followed by busts.

So our governments need to prepare for them well before they arrive, by creating systems that are agile and workable. Regulations should be angled towards increasing productivity.

We can’t continue to saddle industries with cost burdens and expect them to survive any coming storm.