Forty jobs expected to go as Orica adjusts capacity

FORTY jobs are set to be cut from the Orica workforce at Yarwun, Gladstone as the company reduces its capacity because of challenging market conditions.

Of the 40 positions, 11 are already vacant. Orica Yarwun currently employs about 215 people.


>> Explosives giant Orica to cut 700 jobs in 2015

Jobs will be cut from a cross-section of the workforce as capacity slows from 320,000 tonnes of ammonium nitrate this year to 280,000.

Management began talking to workers today to outline the company's position and the process that would now begin.

Yarwun general manager David Buick said briefings with the workforce would be completed by the end of the week.

He said most people knew the announcement was coming - it was just a matter of magnitude and timing.

In November Orica announced it would cut about 700 jobs across the company in 2015.

The explosives giant had already cut 1300 positions in the past two years.

Mr Buick said the company had been optimizing its business like every other company, looking at how it could improve efficiencies.

"We make a couple of products, and will be doing a business review of the entire structure," he said.

"The forecast for next year is such that we will take half the plant offline. But we will have it sitting there so if needed it can be turned back on.

"We have more labour than we need for current demand."

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Mr Buick said there would be quite an extensive process in developing selection criteria for redundancies.

He expected most of the workforce would be let go between September and December, but there may be some positions cut before then.

Unions would be notified, but Mr Buick wasn't expecting any pushback.

What the company said in its statement:

A statement from the company read:

Orica today confirmed that in response to challenging market conditions, it is adjusting its operating model at the Yarwun site in Gladstone.

Yarwun general manager, Dave Buick, said: "While we remain confident in the long term outlook for ammonium nitrate, there is a near term oversupply in the market.

"As a result, we have made a preliminary decision to adjust the capacity requirements at Yarwun," Mr Buick said.

"This decision follows extensive analysis of the market and was previously flagged in our interim financial results market briefing in May this year.

"Today, we have begun consulting with our employees to understand and address any impacts on the workforce.

"We expect there will be some impact on staffing levels from this decision.

"However, the fact remains that Orica is operating in a highly competitive market in which supply of ammonium nitrate is higher than demand levels, and we need to pursue strategies that secure the long-term viability of the business."

Mr Buick said there would be no impact on the security of supply of ammonium nitrate to customers as a result of the decision.

"Yarwun is a strategically important manufacturing site for Orica, and we remain committed to the operation and our strong presence in the Gladstone area," he said.