CSR and the Department of Mines: Success at All Costs
There were a number of factors behind CSR’s and the government’s efforts to make the
Wittenoom mine a successful operation. In the early 1940s CSR, a successful Australian
sugar producing company, was seeking to diversify; its investment in Wittenoom was
intended to provide asbestos for plants in its Building Materials Division as well as develop
domestic and international markets for the fibre.
70
According to the report of W. W. W.
Shepherd, the Chairman of Turner & Newall, a British asbestos corporation, who visited
Wittenoom in 1951, CSR was determined to succeed no matter the amount of investment
required in the mine.
71
It was a financial commitment which CSR would maintain to increase
production, but which they would ignore with regard to occupational health and safety for its
workers. At the same time, the Australian government was seeking to stimulate the country’s
economy after World War 2 and had included asbestos mining in its strategy for growth. The
government wanted Australia to become self-sufficient in asbestos as a precaution against
failure in overseas supplies, as had happened during the war.
The development of the
Wittenoom mine would also facilitate a presence in the isolated northern region of Australia
68
Motley Rice Plaintiff’s Exhibit no. 10496: Memorandum to M. G. King (ABA director) ABA
Wittenoom: Industrial Disease (Asbestosis & Silicosis), 18 September 1963.
69
Commonwealth of Australia (2009), 'Mesothelioma in Australia’, p. 6.
70
McCulloch (2006) Op Cit. p. 4.
71
Shepherd, W. W. F. on Visit to Australia, 28 April, 1951 to 6 June 1951. Turner & Newall Papers
104/1080-1101, Manchester Metropolitan University.
292
seen as vulnerable to the country’s northern neighbours.
72
Both parties’ substantial
investment in the project made Wittenoom’s success an imperative.
CSR’s entry into asbestos mining provided the Building Materials Division with a
suitable additive for its building products and as a result the division increased its profitability.
The company would nevertheless face logistical difficulties and considerable costs in
developing the Wittenoom mine, and they would find it difficult to compete with the price of
South Africa’s blue asbestos. Commonwealth and State governments gave financial support
to CSR to defray the company’s costs.
73
In CSR and the Department of Mines’ endeavour to
see the mine succeed, both proved at times complacent and at times intractable in the face
of Mines Inspectors’ reports and the inspectors’ several threats to prosecute the company
and close the mine. The inspectors cited the dusty conditions, lack of adequate ventilation
and an inefficient exhaust system. The Department of Mines, rather than act upon their
Mines Inspectors’ advice, vacillated in their response. They waited for ABA Limited to carry
out repairs and improvements, which were not always forthcoming. Meanwhile, CSR — who
had the final say on all expenditure and decisions at Wittenoom — questioned the inspectors’
appraisals and concentrated instead on how to cut costs and increase production.
74
On at least two occasions in the early years of the mine’s operation, CSR, with no
experience in mining, reviewed whether to continue the Wittenoom operation.
75
On the basis
of the Commonwealth and Western Australian State governments’ assurances of support,
the company kept the mine open.
76
To address its lack of expertise, CSR established
relationships with overseas asbestos companies by visiting their mines and factories. In 1948
the ABA Limited Managing Director travelled overseas in search of a suitably qualified
candidate with experience in asbestos mining.
77
From the late 1940s, both CSR and ABA
Limited executives made several visits to South Africa’s Northwest Cape Province to review
72
McCulloch (2008), Op Cit. p. 76.
73
Motley Rice Plaintiff’s Exhibit no. 10554: The ABA Story (1963), Chapter 12. Layman (1992), Op
Cit.
74
Motley Rice Plaintiff’s Exhibit no. 10147: Extracts from the CSR Board Minutes (1943-1967
inclusive) concerning the Wittenoom asbestos venture.
75
Motley Rice Plaintiff’s Exhibit no. 10147: Extract from CSR Board Minutes (1943-1967 inclusive)
concerning the Wittenoom mine venture. See entries for February 1945 and February 1946.
76
Motley Rice Plaintiff’s Exhibit no. 10554: The ABA Story (1963), Chapter 1.
77
Motley Rice Plaintiff’s Exhibit no. 10168: The Managing Director’s correspondence to the Wittenoom
manager regarding ‘Mine Matters’, 27 September 1948.
293
Cape Blue Asbestos Limited’s mining practices. Among the company’s executives were
Malcolm King and Wittenoom mine manager Osborne Allan. In 1949 King reported South
African mining practices to be even more primitive than at Wittenoom. Eight years later,
Johns-Manville Limited arranged for Osborne Allan to visit the same mine, to inspect mill
machinery ABA Limited was considering installing at Wittenoom.
78
Both visits were to the
mines where Wagner’s research had reported the deaths of black workers from
mesothelioma in the 1950s.
79
In the recollections King was instructed to record for CSR
directors in 1974, he remarked, “From discussions with Johns-Manville in Canada and a
week later with Cape Asbestos in South Africa we were always aware of some danger from
inhalation of asbestos dust and fibre”.
80
Visits to North American and British companies and their asbestos mines and
factories continued throughout the 1950s and 1960s, with several objectives in mind: to
develop or maintain business links established during previous overseas trips, to liaise with
new customers and ascertain the likelihood of future asbestos orders, and to reach
agreement with competitors on asbestos pricing.
81
The North American and English
companies reciprocated CSR’s visits. Representatives of the North American company,
Johns-Manville, visited Wittenoom from as early as 1949 and those of the British company,
Turner & Newall, by 1951.
82
CSR courted Johns-Manville Limited with a view to their
becoming partners in the Wittenoom mine; something which never eventuated.
83
Tony
Martino, a bus driver in Wittenoom, recalled that among his various duties between 1963 and
1966 was to drive the international visitors to and from the Wittenoom airport, on sight-seeing
tours of the Pilbara, as well as being involved in the catering for functions held in their
78
Motley Rice Plaintiff’s Exhibit no.10147: CSR Board Minutes — Entries for 1949; Plaintiff’s Exhibit
no. 10140: Malcolm King, 1949, 'Report on Inspection of Cape Blue Asbestos Limited, Union of South
Africa to the Colonial Sugar Refining Company'. Plaintiff’s Exhibit no. 10229: O. A. Allan and A. N.
Marr, 1957, 'Report on visit to Rhodesia and South Africa to the Colonial Sugar Refining Company'.
79
Wagner, Sleggs & Marchand, Op Cit. pp. 260-71.
80
Vojakovic & Gordon, Op Cit. p. 380.
81
Motley Rice Plaintiff’s Exhibit no. 10645: C. H. Broadhurt’s report of his visit to Europe and North
America, 1 November 1956.
82
Motley Rice Plaintiff’s Exhibit no. 10170: Letter from C. H. Broadhurst, Wittenoom manager to ABA
Limited Engineer in Perth. 14 April 1949. Johns-Manville’s Canadian representatives visited for 5
days. Report of Mr. W. W. F. Shepherd on Visit to Australia, 28 April, 1951 to 6
June 1951. Turner &
Newall Papers 104/1080-1101, Manchester Metropolitan University.
83
Motley Rice Plaintiff’s Exhibit no. 10177: Letter from Managing Director to Wittenoom manager, 12
March 1952.
294
honour.
84
CSR’s Managing Director also approved executives’ attendance at Australian and
International conferences to keep abreast of mining practices and, no doubt, as another
avenue for maintaining links with international companies.
85
As the company developed its local and international markets, it gradually increased
production. In September 1948 CSR’s Managing Director wrote to Wittenoom’s manager
stressing the need to push production past the 2,000 tons mark and signalled a projected
increase to 8,000 tons. In preparation for the expansion, he authorised the Wittenoom
manager to order equipment totalling £92,874 [$185,748].
86
Large investments would be
required to replace existing infrastructure, which could not meet the demand.
87
Wittenoom
proved costly to operate and maintain: its isolation meant high freight costs and machinery
lifespan was short due to the abrasiveness of the host ore.
88
By 1955 CSR, in its application
for price protection from competitive asbestos imports, reported to the Tariff Board that it had
spent £1,750,000 [$3,500,000] on capital expenditure, while government assistance had
amounted to £450,000 [$900,000] for housing, roads and water supply.
89
These expenditure
figures are at odds with those outlined in ABA Limited’s Report in 1963, which reported the
government’s contribution for the town’s infrastructure at £650,000 [$1,300,000] compared
with CSR’s £150,000 [$300,000].
90
CSR’s application to the Tariff Board proved
unsuccessful.
91
84
Interview with Tony Martino, Perth, November 2010.
85
Motley Rice Plaintiff’s Exhibit no. 10887:
Marrero Plant News Bulletin, Wednesday, 6 May 1959
announces the visit of Sydney CSR officials Mr K. O. Brown and Dr. P. A. Hanks to the Johns-Manville
Marrero Plant, Louisiana; Plaintiff’s Exhibit no. 10179: Letter from Managing Director to Wittenoom
manager, to give approval to attend the Mining and Metallurgical Conference in Melbourne,16 April
1952; Plaintiff’s Exhibit no. 10904: Johns-Manville internal memo: CSR executive’s visit, 28 May 1963;
Plaintiff’s Exhibit no. 10162: Letter to the Minister for Industrial Development from ABA Limited’s
General Superintendent, 28 August 1963. ABA Limited Director Broadhurst was to visit North and
South America, England and Europe. The ABA Limited General Superintendent was to visit Pakistan,
India and the Asian countries.
86
Motley Rice Plaintiff’s Exhibit no. 10168: Letter from the Managing Director to Wittenoom manager,
27 September 1948.
87
Motley Rice Plaintiff’s Exhibit no. 10147: Extracts from the CSR Board Minutes (1943-1967
inclusive) concerning the Wittenoom asbestos venture.
88
McCulloch (1986), Op Cit. p. 77.
89
Motley Rice Plaintiff’s Exhibit no. 10144: Tariff Board’s Report on Asbestos Fibre, 24 March 1955, p.
20.
90
Motley Rice Plaintiff’s Exhibit no. 10554: The ABA Story (1963), Chapter 4.
91
Motley Rice Plaintiff’s Exhibit no. 10144: Tariff Board’s Report on Asbestos Fibre, 24 March 1955.
295
Increased production would ultimately be weighed up against the fluctuating selling
price of asbestos and CSR’s ability to compete with international companies.
92
In 1957 ABA
Director, C. Broadhurst, reported favourably to the Western Australian Premier on increased
annual production: 1955 — 4,400 tons; 1956 — 8,500 tons and by 1957 1,000 tons per
month. He cautioned, however, that projected production figures of 17,000 tons for 1958,
with an increase to 25,000 tons in 1959 and subsequently 35,000 tons, would proceed if and
when the market justified such an increase.
93
CSR’s 1958 profit and loss statement, despite
the international competition, reported positively that
a strong demand continues for blue asbestos and 12,250
tons were sold for the year, compared to 10,500 tons for
the previous year. Additional plant is being installed at
Wittenoom to meet the expanding market… There was
more stability of costs than in recent years and record or
near record sales were achieved in nearly every division
of the company
.
94
The report, exceeding projected production figures for 1958, went on to say that the
New blue asbestos milling plant has been brought into
production at Wittenoom in Western Australia increasing
production to 20,000 tons of asbestos fibre per annum.
There has been a slight weakening of the overseas
market for blue asbestos but local consumption is
increasing.
95
In fact, after 1957, more than half their output was being sold to James Hardie.
96
However
sales to one significant overseas customer, Johns-Manville, had decreased. CSR was
unable to compete with Russian asbestos mines and with the English asbestos producer
Gefco’s blue asbestos mine in South Africa.
97
As a consequence, the company sought to
keep costs down. Between 1957 and 1959 costs had amounted to
₤
961,900 [$1,923,800].
98
CSR had planned to build a second mill, but in the light of the decreasing market shelved
92
Motley Rice Plaintiff’s Exhibit no.10191: Letter from C. Broadhurst, Director ABA Limited, to the
Premier of W.A. Re Production, 7 June 1957.
93
Motley Rice Plaintiff’s Exhibit no. 10191: Letter from Broadhurst, Director ABA Limited, to the
Premier of W.A. Re Production, 7 June 1957.
94
Motley Rice Plaintiff’s Exhibit no. 10232: Profit And Loss Account for the year ended 31 March
1958.
95
Motley Rice Plaintiff’s Exhibit no. 10232: Profit And Loss Account for the year ended 31 March
1958.
96
Gregory J. & Gothard J. (eds.) (2009),
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