RIO TINTO has suspended operations at the Hismelt joint venture pig-iron plant near Perth for three months.
According to the company, it is hoping this will allow it to weather the economic downturn.
The 150 workers at the plant have been put on leave with full pay over the suspension period.
Pig iron now costs more to produce than what it fetches on the market.
Starting 22 December, Rio Tinto shut down all its iron ore mines in the Pilbara region for two weeks, as demand from steel mills declined. This move reduced the miner’s iron ore output by around 10%.
The Hismelt plant is a joint venture by Rio, Nucor, Mitsubishi and Shougang. It uses a new process where raw materials and non-coking coals are directly injected into a molten iron bath to produce high quality pig iron.