CHEAP imports of canned vegetables were yesterday blamed for the closure of Australia’s last tin mill, with farmers warning thenational vegetable industry could go the same way.

BlueScope Steel, the country’s biggest steel maker, said it had been forced by rising raw material costs and competition from imports to shut down its 50-year-old tin plate mill at Port Kembla, south of Sydney.

The mill, the closure of which will result in the loss of 250 jobs, was the only local source of tin plate — thin rolled steel with a coating of tin. The decision to close will force the country’s can manufacturers, Amcor, Visy and NCI, to rely solely on imports.

Industry experts say demand for tin cans is falling as consumers increasingly prefer fresh food and manufacturers diversify into new packaging such as plastic and cardboard. The big retailers, Woolworths and Coles Myer, are also agressively expanding their own- brand products, sometimes at the expense of local producers.

And cheap imports of vegetables, particularly EU-subsidised canned Italian tomatoes, are hurting the demand for cans and local canned vegetables.

“This is something that we feared would happen,” said Tasmanian vegetable grower Michael Badcock, who chairs the grower body AusVeg.

Mr Badcock said growers and processors were being squeezed by rising imports. “No matter how efficient we are, we just can’t compete,” he said, blaming EU subsidies and higher costs in Australia for labour, regulation, fertiliser and fuel taxes.

Australia’s trade deficit in vegetables has worsened this year to $90 million, compared with $60million at the same stage last year. Imports of processed tomatoes alone are up more than 6 per cent at $44.6 million.

Mr Badcock fears that vegetable processing could eventually go the same way as tin plate and leave Australia wholly dependent on imports. “That is the great danger,” he said, warning that once processing was shut down it was unlikely to restart.

News that the mill would be shut was met with stunned silence by workers and claims by the union that the job losses would be an economic disaster for the Illawarra region around Port Kembla and Wollongong.

“Everyone was devastated,” veteran line worker Necati Dun, 40, told The Australian after just coming off a 12-hour overnight shift. “There was a total silence, not a good silence.”

After 19 years at the mill, during which time he lost his right index finger in an accident, Mr Dun now faces an uncertain future as he seeks to cover a large mortgage and provide for his family. He has two sons, aged 11 and eight. “To take away from them because you are losing your job and not earning the wage you used to, it is a shock,” he said.

BlueScope chief executive Kirby Adams was unrepentant. “BlueScope Steel is making tough decisions for volatile times,” he said.

BlueScope head of Australian manufacturing Brian Kruger said Australian manufacturers “just can’t compete against grocers who import own-brand tinned foodstuffs in preference to Australian tinned produce”.

Wayne Phillips, acting Port Kembla branch secretary of the Australian Workers Union, said the looming job losses were “devastating”.