Australia’s leading manufacturers have warned that the country’s “broken” east coast gas market could cost thousands of jobs and undermine the federal government’s Future Made in Australia policy.

Speaking at the National Press Club in Canberra, BlueScope Steel chief executive Mark Vassella said the nation risked repeating the United Kingdom’s industrial decline if gas prices were not brought under control.

“Australian manufacturing is at a dangerous crossroad,” Mr Vassella said. “Major change is required to fix our broken gas market and reinstate a fair domestic price. If we can’t, we face a decline similar to that of the UK steel industry.”

Mr Vassella, representing industry group Manufacturing Australia, called for an east coast gas reservation policy and a $10-a-gigajoule price cap to ensure affordable supply for domestic manufacturers. The group argues that reserving one-third of current production would meet domestic and residential needs while maintaining export volumes.

Despite Australia’s vast gas reserves, manufacturers pay some of the highest prices in the world — averaging $10.30 a gigajoule last year, compared with $2.20 in Qatar and $3 in the United States. “Local gas users are effectively paying for export infrastructure they don’t use,” Mr Vassella said. “It puts Australian industry at a structural disadvantage.”

Manufacturing Australia chief executive Ben Eade said the federal government’s $12-a-gigajoule cap had failed to reduce costs. “It’s not a cap, it’s effectively a floor,” he said. “Production is up, demand is down, yet prices have tripled. That’s a broken market.”

The Australian Competition and Consumer Commission’s latest gas inquiry report found recent interventions had delivered “no material improvement” for major users and warned of potential shortfalls by mid-2026 if uncontracted LNG continued to be exported.

High prices have already forced several industrial closures, including Qenos, Oceania Glass, and Incitec Pivot’s Gibson Island plant. Aluminium maker Capral said gas now makes up 7 per cent of its costs — triple what it was five years ago.

Manufacturers are calling for a nationally consistent gas reservation scheme similar to Western Australia’s, which has long ensured cheaper domestic prices.

“A future made in Australia depends on affordable gas being made available for Australian industry,” Mr Vassella said. “No gas, no future made in Australia.”

Material prices across Australia are continuing to rise despite global markets easing, with industry experts warning that deep-rooted productivity problems are driving the nation’s escalating construction costs.

The Productivity Commission’s 2025 report shows housing productivity has plunged more than 53 per cent over the past three decades, meaning it now takes twice the effort and cost to deliver the same level of housing output as 30 years ago. The decline comes amid a worsening national housing crisis, with projects taking longer and requiring more labour per dwelling.

These inefficiencies have created ripple effects through the supply chain, forcing material suppliers to adjust to volatile demand and pushing local prices higher. Skills shortages and a surge in construction insolvencies — up 21 per cent to a record 3,595 cases in 2024–25 — are adding further pressure.

Quarterly data highlights the structural imbalance: concrete prices rose 2.5 per cent this quarter and 6.6 per cent year-to-date, while plasterboard jumped 4.3 per cent over the quarter and 6.5 per cent annually. Bricks climbed 6.4 per cent over the year, despite a slight quarterly dip. Steel prices edged higher, while global oversupply has done little to ease costs.

In contrast, diesel prices fell 6.5 per cent this quarter, returning to pre-pandemic levels, and copper pipe prices rose 6.7 per cent, reflecting genuine demand from electrical trades rather than inefficiency.

Cost escalation is forecast to remain elevated through 2027, led by Brisbane at 7.0 per cent next year, before easing slightly. Sydney and Melbourne sit around 4.5 per cent, and Perth is projected at 5.75 per cent.

Analysts say international price drops are failing to reach local markets because domestic inefficiencies dominate final costs. Extended project timelines, stop-start production, and high energy use are eroding savings.

Experts argue that genuine cost relief will only come when productivity improves through modular construction, offsite manufacturing, standardised design, and digital project management. Until then, Australia’s construction sector faces a prolonged period of high costs, shrinking margins, and worsening housing shortages.

The Minns Labor Government has extended its subsidies for commercial flights serving some of Western NSW’s most remote communities, ensuring critical air links remain in place until November 2026.

The $2 million investment, funded through the Regional Development Trust, supports flights operated by Air Link between Dubbo, Bourke, Walgett and Lightning Ridge, and by Fly Pelican between Sydney and Cobar.

Under the program, Fly Pelican operates six return flights weekly between Sydney and Cobar, while Air Link provides eight return services connecting Dubbo to Bourke, Walgett and Lightning Ridge.

Minister for Regional NSW Tara Moriarty said the extension would help regional communities stay connected to essential services and economic opportunities. “Regional communities rely on air travel for its convenience and speed, to reach healthcare, business appointments, and to bring in visitors and workers,” she said.

Local leaders, including Cobar Mayor Jarrod Marsden, Bourke Mayor Lachlan Ford, and Walgett Mayor Jasen Ramien, welcomed the decision, saying the subsidy is vital to the social and economic wellbeing of isolated communities.

The program forms part of the NSW Government’s commitment to delivering smarter, more reliable services for regional communities.

The Australian Government has committed $58 million to establish the Additive Manufacturing Cooperative Research Centre (AMCRC), part of a $271 million investment over seven years to strengthen sovereign manufacturing and industrial innovation.

The AMCRC will unite 101 partners, including Boeing, more than 70 small-to-medium enterprises, three industry associations, 13 universities, and the CSIRO. The centre will focus on advancing additive manufacturing (AM) technologies to improve production efficiency, reduce costs and waste, and support Australia’s transition to a net-zero economy. Target sectors include defence, aerospace, healthcare, automotive, and construction.

“Additive manufacturing has evolved from a prototyping tool to full-scale industrial production,” said Simon Marriott, AMCRC Director and Bid Lead. “This transformation is reducing lead times and material costs, creating more efficient and sustainable supply chains for Australian manufacturers.”

Boeing Aerostructures Australia will be among the major industry participants. Matthew Wall, the company’s Additive Manufacturing and Innovation Lead, said the AMCRC would accelerate collaboration between technology developers and researchers. “Boeing is committed to advancing AM technologies that will define the future of aerospace production. The AMCRC will help build national capability in tooling and materials,” he said.

Developing a skilled workforce is another key objective. AMTIL CEO Lorraine Maxwell, also an AMCRC Director, said a coordinated focus on education and training would ensure Australia keeps pace with global AM leaders. Marriott added that with the involvement of 13 universities and the CSIRO, the centre would support industry-led PhD programs, grow undergraduate enrolments, and expand access to vocational training.

The AMCRC’s launch aligns with a broader international push to embed additive manufacturing in national industrial strategies. Germany’s coalition government has included 3D printing in its technology roadmap, while the UK Labour Government has pledged to prioritise advanced manufacturing and Industry 4.0 under its new Industrial Strategy Council.

Together, these developments mark a global shift toward advanced, digitally integrated production — one that Australia now aims to lead through coordinated public-private investment and research collaboration.

The Albanese and Minns Labor governments are working together to build Australia’s future by growing the Australian manufacturing workforce, through Free TAFE.

Four new Free TAFE courses have been established, designed to upskill Australians, boost onshore capability, and support employment opportunities in the industry.

The four Free TAFE courses are being offered through the TAFE NSW Manufacturing Centres of Excellence, announced late last year to support manufacturing education and training across engineering, transport and renewable energy sectors.

Funded by $78.6 million matched investment from the Commonwealth and NSW governments ($157.2 million total over four years), the specialised training Centres are being established at TAFE NSW campuses in three of NSW’s major manufacturing industry areas – Newcastle/the Hunter, Western Sydney, and the Illawarra.

The Free TAFE courses have been designed with industry to upskill existing workers and equip the future domestic manufacturing workforce for emerging industry needs, boosting onshore manufacturing capability and providing more career opportunities for local workers.

Enrolments are now open for three Microskills (self-paced short courses) delivered online and one Microcredential:

• Discover renewable manufacturing careers – a Microskill introducing the industries, technologies and practices enabling renewable manufacturing in Australia.
• Discover advanced manufacturing careers – a Microskill introducing advanced manufacturing and its role in driving innovation, sustainability, and economic growth in Australia.
• Maths foundations in the manufacturing industry – a Microskill supporting students and workers with mathematical concepts to perform accurate calculations and solve problems in a manufacturing setting.
• Generative design and analysis – a Microcredential providing specialised training in advanced computer-aided drafting software for manufacturing product design and modelling to solve real-world manufacturing challenges.  

The four courses are the first of a series of short courses, education and training planned for delivery through the TAFE NSW Manufacturing Centres of Excellence this year.

To further support tertiary harmonisation, a University Partnership Panel has also been established to collaborate with the TAFE NSW Manufacturing Centres of Excellence on design and delivery of the specialised training. 

10 university partners across New South Wales, Victoria, and Queensland have been included on the University Partnership Panelandwill collaborate with TAFE NSW over the next four years to support expertise in manufacturing education. 

This could include contributing subject matter expertise to inform new manufacturing courses, providing access to specialist equipment and facilities, and development of educational pathways and higher education qualifications.

The 10 universities are:

• University of Sydney
• University of Technology, Sydney
• Western Sydney University
• Macquarie University
• University of Wollongong
• University of Newcastle
• Charles Sturt University
• Griffith University
• RMIT University
• Swinburne University

Locally, the TAFE NSW Net Zero Manufacturing Centre of Excellence will boost local capability, enabling the community to take advantage of the opportunities of renewable manufacturing and the Hunter-Central Coast Renewable Energy Zone.

The Centre will deliver tailored, industry-aligned training needed to skill local workforces ready to lead in onshore manufacturing capabilities in resources, aviation, defence and transport.

The TAFE NSW Manufacturing Centres of Excellence are a joint initiative between the Australian Government and NSW Government under the National Skills Agreement.

Quotes attributable to Minister for Skills and Training Andrew Giles:

“Free TAFE is changing lives and it is building Australia’s future. 

“The TAFE Centres of Excellence were established to be job-creating hubs, and this is more evidence that what we’re doing is working. 

“The Albanese and Minns Governments are ensuring manufacturing needs at a local, state and national level are backed by a pipeline of skilled workers and a strong economy for years to come.

“More Free TAFE courses, means more Free TAFE students and more Free TAFE success stories. 

“Through strong ongoing with industry and universities, TAFE is shaping the future of manufacturing education in Australia.”

Quotes attributable to the Minister for Skills, TAFE and Tertiary Education Steve Whan:

“These first four Fee-Free TAFE courses being delivered through the Centres of Excellence are just the beginning of the collaboration across TAFE NSW, universities and the manufacturing industry to support a skilled workforce to meet national challenges across the manufacturing sector.

“This partnership will deliver more technical and hands-on training to students across renewable energy and advanced manufacturing, with a focus on sustainable and technological innovation.”