17 JULY 1976

. ,

On July 31st, o u s Lo a d s of p e op Lo f r;o Dunedin and Ctl.ri~tchurch will arrive in Errv er-c e r-g i L'l. to. talk "TlLth Suuthland residents'

a b o u t; Corna Lc o, , G,n the Sunday ,a ck:;'onstra. t Lorr will be held

.at ~he s~elter site.

Already, CAFC1NZ has received excellent support in dcne t.Lo n s towards the cru~paign from allover New Zealand. AnotbBr crucial way people can ,help is by discussing the issues involved' wi, th friends and work;na to s. The ceoro .p o o.p Lo who und.erstand what we are on: a b o ut , the ;;i~)re support we will win, apdthe: more effectiVe we will be. We cannot ,count On the big papers

or broadcasting to vresent nul' poin~ of view accurately. People can also sell the "~Jatchd6g" C'i1i3.gazine on Corna Lc o (s(m\E.~ s\lpportet's are doing thi~ very well) or distribute extra ne~sletters - let us kriow if' y o u want r:ore than one 1 or just pass on y)ur own .c o py ,

i4.nd p eo p Lo w h nro u.n.d.e c.Ld e'd whether togo to InvercargiJ.l, please send $5 .OO .. :leposi t*now! l-~';TaLn, th.e F.i1)re p.o o p Lo , the

,::0 ,

moreef'f~ctive. It should be ad ihteresting and rewarding


* Late at date f'o r- accepting those is Thu,rsday22nd .J'u.Ly ,

C{\.FCJNZ is Lo o k i.n g fo r- soc:eDneVlrho r-e c e i.v e s 't.h e "Southland

Daily TiE2,~§.!1 who cari take c L .Ln g s out o:fpaper for USo

·,,;Ie are .i n t.e r-e s t.od .t c see ClSJ.yt;;dng r-c.Let Ln g to Corna Lc o , New

Zealand AlulIliniurn lters Ltd (j'lZAS), Kaiser Ltd, Showa Denko

and Sumitomo (the ,Japan",.sepa.rtners in t:l.e sii,elter) or anything to do with alumini.l,uu.lve .are Lnt.o r-o st ed in r-e c e a v i ng j t h.e s e

clip~ing~ because, ap~are~tly! fe is quite d iot published

about 't he srne Lt.e r- in Invercargill wtJich do es 'not reach n.ew s « papers elsewhere in N~. In particule;r" we are very'in.tere sted

in any press stnt8ments by CUlCdolc() SCI t w e: can keep tabs "

on tl.eir 'public relEltilusprogr Qv')tc fr,n the :Catholic

paper, "N.Z. 'fa.blet": 't he "public reLl.til:r.lS Sl,de of Corna Lc o

is a well-:tinanc~,d attempt t,.) s t LfLe c r-ti t.Lc i em of' the cunJpany's activities in this country.1V

Anyone who can help pleose write to CAFCINZ, Box 2258, Cheh.

rt"Gothc,r qUOtE: 1'1',));.'1 the"N.Z. Tc:\blet"; .it says that Corne Lc o is highly sensitive to criticism, knowing the battle over the smelter and electricity is g ing to become a fierce one.

"It is de t.o r-ru Ln o d to win and any o ppc s a tion will be attacked ruthlessly."

3. Bauxi te to Alwliniuf] ,)1'


In 1955, Lortsolid~t Zinc Proprietary Ltd, a 3ritish-owned

company operating in Australia, discovered the world's largest and richest de pc s t t of t e a Lus-ii.n i.um are, b eu x.i t.o , Once the deposit had been proved, Conzinc was faced with a number of p r-vb Lcms r where to ge t . 't h o tec'hriical expertise inalumium p r-o du ct.Lo n , h ow tCl i~'2t' rid 01' the Ab(/rigin~i"cJwiiers . ["the." land wli':{i:;h' co n t'e.Ln o d thd e si t, and s t; i'l;)ortantly I. hQW

t o c r-e at o: a:narket fJrt'hc) bCluxi t.o , The?';;anner in which i;.!iese p r-o b Lom s were solved and the nature' of the aluminium :i,ndustry that was set up as a result, both shed c~nsiderable lig~t on the real nature of the Bluff aluminium suelter,

Conziri6 ~81~eH the technology problem by j~ining in 1960 w:i,th

an experie:&ced aluminium p r o du o e r-', ll\i'liser j.,luminil-lp a n d Chemical Corporation (US) to f6rm a special co~pany to exploit th~Weipa bauxi 't e , 'I'h i 's frcnt C0'71(:'lany W<"':8 called the Cornmo nwe a L th Aluminium Compa ny , or Co maLco ,

. 1

The AtQriginal prob~~~ was ~lso 6 ly sQlved~ With the assistance' o f' the' Quoensiand (';.ovormho'llt and the Churches, Coma Lc o forced the (,boriginalstoleave the Lend tlhLeyhad L'Lv e d on

for centuries. All Camalco had to pay for the biggest bauxite deposit iutbewlrld was $300,000, Ute co s t of shifting the

p e o p Le to a no ther place. The' 'Aboriginalpe)pl<3 bitterly re sisted Coma Lc o , and. even today tho fi t goe s on -. 8l.ri. wi trl increasing success.

The Rio 'I'Ln'to ZindCorDorati':m (w'lich t,)c)kover Co nzLn c in , 196~!,) describes itself' and its subsidin.ries ns "a g r c ot international companies working together to help develop the mineral resources of the world for t~e bgnefit of mankind!

Tho truth is,tlintaTZi.1nd Come Lco are developing ineral r,esouree s "f o r- pr.)!i t, andprc)fit alone. 'I'h Ls is sho,wn c Lc.a r Ly

'in the fact that tb.urewrJ.s!!.cvera1.!Y.- need .to ~2.::.y;~loll) __ th6··We,1Ea bauxi to ,at all. 'Inthc oarly 1960 ';s, tho existing J:V~·uxi te

mines were qui te sufficient t:) meet ti-;,e w:)rld.. de then and

for a long tiJrDe irito i:ihefutur().

But Coma Lco wante'dpr;)fits, s'o it sot ah~)ut s o Lv Ln g ,'\>(hqt was in fact its r;,ostd:tfficult proble',h - finding a mClrket for the

bauxite. Because 6f si~e df the Weipa deposit (20% of the

world's kn~wn rQservEla), and the ea:§e of mining it, it wuuld

be possible~ by:minin~ bn a verY lCl.~ge ~cale, to praducebauxito very choaply and thus ~ridGr6dt the existing' 6ines.. But this would be about as far as Comalco c~uld g, They would not be able to engage in 1 ge ... scaale., e Lurn in i.um production, because they faced a si tuati.n in which the) Bel-called "free world"

e Lum i n i um market, was C<:lnd E .. till is) dor:'linated by the "big four" - in order o f' p r-o du c tLo n , ALCUA, ALCAH, .lEYNOLDS HETALS and


~ -

K/USEH fi.LUlVliHUI,l. "Alcoa, it is said, is not above slashing prices in pe r-t-Lc u Lar- lines if that is what is required tc re,gain or h c Ld onto (i t s ) ma r-k e t. share." (fr')D "Pacific Emp e r=iali'!;F'; No t.e b oo k '! , August 1974).

Com.-tlco did not try t::) fi t th.is situation. Instead, it ha s concentrated on produ6ing large quantities of cheap bauxite, and selling it to the existing aluminium c ompzm i o s of the

10 million tons of bauxite ~ined annually at Weipa, 85% is taken at present by competitors Qf RTZ and Kaiser. Comalco's main activity as a company is in fact the ining and selling of bauxite.

£!1.:!;!pdnium Production by Comalc:?,:

Although the world market for aluminium ~as not open to Cornalel, there was a small potential mar}ret available in ,\.ustralia and New Zealand;'I,"'wi th their high, living standards ,::mght to be

co n eum.i.n.g about 30 Lb of aluminim;, per head each y ea r , But

in b o th . countries in the o o r-Ly 19601 s c o n sump t Lo n was less

than h~lf of this, so bere was an op~ortunity fornore profit!

'But again, there were pz-o b Lezas, Aluuiniul'"i p.r o du c t Lo n involves two steps - first refini2g thebauxit~ are to pure aluminium;

oxid,.w, ;or a Lurnf.n e ; and s e c on d sl;'e.ltingthe e Lucri.rra t.o produce

a Lum.Ln.Lum , To be ec::;u'omical, both operations must be d)nG on

a large scale, a iiTf14ch Lc~rger scale than the marke t could cope wi th; a rrd the smelting ope r-a t Lon de,',anded large q u an.t Lj; ie s of very cn e a p e Le c triei ty. Bot h probl"<3lDs CO:I:Jalco 'solved very cleverly.

J.'he cheap e Ie c trici ty VJa s the e a s i e st,-- Corna Lc o was already getting subsidised power for a s.elter in T'e srue n.Le , and as

well the N.Z. Goverrunent offered, and then wBnt to great lengths, to provide Comalco wi tht~le c vun t r-y ' 13 cheapest power at cost price.


he problem df large scale production was solved by setting up

a series of joint companies of a special kind, called by Comalco "co-operative c)):'lpanies".

Queensland Alundna Ltd:

The :first f' these "co- perative 'c xnpanico;!I , c a Ll o d Qu.eensland Alumina Ltd, operates the largest alumina ~efinery in the w~rld at Gladstone, un the Quoonsland coast. Each year,

2 milli')n tens o f b e ux.i.t e is r-o f Ln c d t;.)alumina at G1'J:1stone.

The function of Q.A.L. is simply to convert bauxite to alumina at cost. Thero is no 'profit - the incentive fur theporticipating C9mpanies is the cheap alumina that they get. All the bauxite c orae s f r-orn the (-Teipa fxlines owned by COI"lalc , and each partner is "com::·i tted to sup,:,ly raw materials (i. e. bauxi t e ) , guarantee :finance and, share output in direct proportion to its equi ty share. II

Tho share 13 in t;>e cor:,',e,pny are: C;)rnalc() 13.8%, Kai ser 32 t 3%, RTZ's Austr~lian subsidiary 12.5%\ Alca~2I.4% and Pechinery Ugine Kuhlmann, f F'r-a.n c e , 2Q% C'ornaLc o itself only takes a small :fraction of tho output, but b~cause the refining is being done on s u c h a large: src e Lo , it is still very ch o a p a Lumd.n.a for Comalco.

No t, o nLy .;~l()es C()u}I~'jlc r:;et cTn.ea:~) e.Lumin a f r-or ()~aA.I):L., '1 bu t it

also is able t t rid of a I t MOrG bauxite. So successful w a s the G.ladstcHw plant "in c h on n e L'i.rrg \.r,Jeipa bauxite into the c o n s urop t Lo n pattern of thc'"nrld aluminium industry", says Conaleo, that a second refinery hes been set up in Sardinia on. o xa c t Ly t he same :L)rlnC1I)1(~s It Lc o has a -2'0\% SrlE:lre .i n this refinery, whi also gets all of its bauxite from Weipa.

Q.A.L., then, perfectly suit Co~alco's requirecents. It provides a further outlet for Weipa bauxite (and thus further increases Camale 's pr fits), and it provi s Com~leo with the c h e e p e Lurni.rra witT:. which t.o If,:>icveloptr the Australasian mark,-;t.

Thero is one further peculiarity about Q.A.L. and Comalco~ Coma Lco 's two a Lura.t na urs Eli1tel ters (Tasr:;ania and Bluff) co n.s ume

at present about 1110,000 tons of a Lueri.ne each year, yet Come Lc o t s sh.ar'e of Q,.iLL.' s o u.t p u t i.'3 only 13d,000 tnns.v:!hy .i s this?

A possible answer C()Ges from exa~ining thcexact ownership

of C;)EIlalco. Originally, ;'{TZ and Kaiser owned 50% each, but in 1970 they sold off 10% of the shares to the Australian and

N.Z. public. If RTZ and Kaiser wanted to avoid sharing all the

profits with this 10%, this can be easily dane by me~ns of Q.iLL. operation - because. here .sUla!co is selling ,bau;x~te to its ~woparerttB and th~n bUlin~ alu~ina back from thew. Thus to shift profits out of Comalec, all they have to do is sell the bauxite c he ep and buy the alu~dna dear. And judging by past and present practices of RTZ in particular, this is

almost certainly happening.

The Third Link in the Chain:

Corna Lc o h~ S s e t up a third n CO-Op(3ra t Lv o company" '!rlhich gOG s under the name of "NZ Aiuminiuci Smo Lt.e r s Ltd" - none other than the, 31uff sooelter. What Comaleo wanted WBSi an the one hand a relatively 8':;[",,11 B."'()untof aluminiufn li:';)r the [:J,arket

that was available, and on ti,e) ot h o r- hand largl) .s c a Le. pr<)duction so as to keep the production costs low. So NZASwas set up

on exactly the 8a:"8 b a sis ,3. sQ. A. L. ~ II each partner h.a s c o n t.r-e c ted to supply finance and raw materials and shar output in proportion to its equity Lnte r-e s t s '! The p a.r t ne r s .i n this case are ConaleD with 50%, Sumitomo Cho~ical of Japan 25%, and Showa

Denko R.K. also of Japan, 25%. Q.A.L. provides each partner

with its share of the alweina, and NSAS then converts it into aLum i n f um 'for 010m at cost p r Lc e , Again, rio pr fits arc fi1ade here clirE')ctly. lilt was nev o r- intended f,:)'z:" t.h e s,'elter company

to :,'u'lke a p r o f L t or a lossli, says Corao Lc o , Instead, the

prc:.':fits e r-o t atce n in t.lL(;c) f r:::' o:f cheap a Lunri.ni urn - tho two Japanese co os ta t~eir share to Japan, and C cO re-exporting about half of their share, mostly to Hong Kong

(over 75% of the total re-exported). And as with Q.A.L.,

Camaleo gains as well by having found yet another outlet for ~eiDa bauxite - this time in Janan.

dhy build the s::::elter in [',r. Z., wi;-Ietl thc; aLum.Ln a w o u Ld have to be ship')cd in, and the a Lura LnLura ship ed out a[1;ain (two o th e rsi to Siflerl-J available, to Corna Lc o wbo r-o transport costs w.xu.Ld have; 'b e e-n I"lUCh che a po r-}? Th.G answer is g i, v e n very clearly by the head of the T"c,clu"io'logy Dept a t. Otago Un Lv o r s Lt y , who said: "so great is the c o n t e n t of' e Le c t.r-Lc i ty in t.h e. p.ro c e s s e s involved that th.e cost of long ocean hauls f o r both raw EJater-

ials and the products can be ~utbalanced by the savings effected by using e Le c trici ty where it i 8 c h e a po at. VI Indeed so cheap

is Manapouripower for NZAS that one of the Japanese partners hag said it would Ld kc to s e e the srae L ter producing nearly

four t Lmo s as much 'a Luraf.n Lum a s at present.

~e can certainly see how ridiculous is the notion that the Bluff' a Lum Ln Lurx plant is "our sme L terl!. It is not. It serves and is co n t r-o Ll.e cornp Le t e Ly by .J_TZand Kaiser, e c t Lng through Co~alco. It is simply a device for increasing their profits by increasing the c o n aumpt Lo n of -(;leipa bauxite, and at the

SB';,ie time providing the wi t h a S)UrCE) of cheap e Lum.i.n i um ,

Marketing in New Ze~land:

Coma Lc o sells a Lum Ln Lu.o in l\J.Z. at the sa:":'.8 price as W8 would havo t.o pay for Lmp o r t.e d a 1 um i.n i.um - wo r Ld market p.r Lc e Elus the price it lV-QuId COI3t. to transport e Lura i.n i.um t.o N.2. Aluminium is not chea er because Corualco is here.

Comalco has also set up a nu~ber of subsidiaries in N.Z. to fabricate a Lum LnLum p r-o du c ts and to rna.rk e t; these products. Through the s o comp anLe ts , COf",al co lna s engaged in "mar~cet· dev-

e Lo pme nt II - advertising c empa.Lgn s , finding new use s for e Lurn Lrrium or persuading p e o p Le to s ub st L t.u t o a Lum Ln i um for o t.h o rmaterials - wi th the re sul t thn t e Luzei n'i.um con s ump t Lo n h a.s increased about 70% in the last five years.

This increase has occurred basically regardless of whether

or not w e needed it. Alwniniurl dO!2 s hav e the useful properties of lightness and rust-resistance. But Camalcats criterion is not u s e f'uLnc s s or need, but 2F0f'ih,bili.!'ye Thus tl.1_er·e are undoubtably areas where, with Comalca's help, aluminium is pushing out other naterials that are quite adequate for the purpo S(~ e n d pr,~)bq b ly ;,':';;u'ch c he (3. ~;!er, v,Tl1.G Jl -{tie ta.l:~e Ln to ~3. C C01..!n t

the fact that aluminium is ,heavily subsidised through the

cheap electricity (in fact, vrith C:):Clalco in N.Z., a Lurn i n.ium

is ef:fectively e bo n t; 80 contsper. pound - if Coma Lc o were not here it would cost us about 40 cents per pound!!!).


We can now see how Conalce has d to sell bauxite which

the world did not need - by setting up lar -scale operations e f f e c t Lv e Ly undercutting existing bauxite m i no s , At the SCl7j e time, and r,,iore or loss as a [;i;)ieline, Coma Lco has li,J.eve1oped" the Australasian market, Pbrsuad~ng us to considerably increase our c o n s ump t Lo n of e Lur-ri n.Lum, Tho Bluff 6[{',e1 ter serves

b o t.h o f' th.ese purpo ae s , wh i.c h are in r-o ali, ty o n Ly one - Ln cr-o a s Ln.g Comalco's prpfits.

Comnlce is in New Zealand for the profit~ it can make,and

:nothing else.

irJe J::1Ust realise this and see thr:;cugh th.e prJp-

agaucla - ch')veloping res)urces !If'or t J.-1O b e n e f L t of Dankind" , an example of "international co-uperati-)niY, "linking t~\gether two ,"';.'1 j -)r rio t.u r a L re source s tI, a f o r c o for "world p e a c o II, N. Z. "participatic1n" in the 1!international a Lum.i.n Lum industry" ...

on and on goe~ the dGcept~on, all to cover the one true motive, ~rofit. We must see this, and we Dust forco the Government to

rectify tho present disastrous agre with Cornalco. It is

time for our interests, the interests of the N.Z. po 0, to be

out before thoso of

£:!ultin.ati:)nel parElsi to 0


------_ ... --


he motor asseGbly


two 28ssivo US c

industry in New Zealand is dOGinated by the es - General Motors and Fords. Both are

h e r e fo r- 0](10 p.r Lmo p u r po S~-) -. to n:;,:ll{G ~"'j,:)ney: El t l'Te"r 2~(~E'~hl1d' 5 e xo e n s e ,

A recent news report (Chch Press, 7/7/76) than 700 hourly rated workers e~ployed

at Lower Butt were yesterday given notice

dispute involving me~bers of the ineors'

plant at a star; dstill th.is "reek. Ferd' G

the Ford Motor company f susnonsion. A Union has kopt tho

managor, lVr I. G.. Douglas, sei the c·)l:lpany was t ablo t·:)

o f f ez+ wo r-k in t:cc sec c ir-cura s t.e nc cs to it g h:)urly-ra to (T' staff. II

So now, more than 700 N.Z. workers are threatened by Ford's with no income - with no regard for how are to pay for rent, f ood an d c Lo t h es f o r- their :fa:nili(;;s, )r L,e()t tliJiCJir other

com0ittcents. And it is not the first tiillO it has oned -

in 197L}, both Ford I s an.dG,oI1(,"ral )'10 tor s Lo c lco d out c o a c hwo r-Ice r a ,

Perhaps Ford's is struggling to meet its wages bill, you may suggest. Not on your life! While asseoblors are paid about $18.00 per day before tax, Ford's has since 1970 averaged a profit of $4,150,000, a year -a rate of over 75% of share

capital (of $5,300,OOO)!!! While of these superpro:fits

are retained for :further expansion in N.Z., each year since 1970, an average of $1,542,000, has been sont back in dividends to t.he USA.

Every year, the fruits of N.Z. labour are exported to such giant corporations as Ford's, or saved in New Zealand to help thom expand their Ln.t o r-o s t s h.(',.rc!. The original capital (Fori's invested $800,000 in 1936) has been repaid many times over, but still the companies continue to drain Now Zealand.

Tho e c o nosn ic in.terests of' Ford's and its like ar\) c Lca.r-Ly

o poo s o cl to the wc Lf er o and lOHgter:,,·. intacc-est,:-, of the N.Z. people - as t Ford workers know all too well. CAFCINZ condemns the For lock-out and supports the Ford workers in their struggles - they are in the front lines of tho strug e against foreign c1ntrol.

Last y e e r- it C':CC~.f:-:'::o ~C7~c-)-~"nr:n. t:t~Elt t;~~£E; g',~iaJ(JLt IV~c1c ld.i!.-l {'larJl)u.rg;or

corporation would set up yet another int nal chain; this

time in ew Zealand. enterprise was to be in conjunction

w it h trow Zo eLan.d ' [; 1!Sh;.)prit()II , a f'o o d crra i.n si;;''iilar to "Ko ys t.or-e s !", MacDonald's alrpa have their distinctive hamburger bars in

2I c~:)u.11tr"i(}s e TI'l(JSCj w¥d.1Ci~v·E~-iIl~l JCE~stE~tl:raxlt.s a~c(; c r;:1.rc.1ete.r~iGed. b'y

the aesthetically dicastrolls drar:lat:ical1.y above e.::,cb ··):11.e,

111<.ti en.d

Sir-.1.a·DC3d ,:lonoli t.h is v sible fro;;.l

that rises

a .S;reat distanc

l';'acDonald.! s hE'lS s Ln c o b o o n quick o f f' tLleOC;lrk. in New Zealand

w Lt h tJ10 r-o c o nt opo n i n g of t}~L(~ f'il:--St ifC'1,X .. Lv o ..... Ln" of a pr-o p o s e d

national chain, at Porirua. Sasic profit is de from franchis-

lug; ma ny r-e st e uz-e n t e to i;a.d.ividuall3. hacDonald' s c La i.m t:r'oir


profi t has been up 14 ti,;',u 5 since 1965, v/hen ti'l.O company went "publicI!. LikollKentucky Fried C'h i.c k e n " t jC;iacDonald' S s pe c La Li ac s in wrap~ing up its food with elaborate reaDs of unrocyclod

paT")(~r and plastic. Apart f r-o m hamburgers, the drive-ins sell

m i Lk s h ak « s and "french frie s II (chi~)s)'

CAFCTNZ would we Lcon:o a sry :further inf'orl'l,Sltion Ewrnbers could supply on MacJonald's. Over the last ~ew decades, New Zealand has been chea~,enod and dOf:li:na ted by America IS rvo nc y c u L t.u r-o , The setting up of a I shei t fa d' hai.?1bu.rger bar chain is yet another blatant s t e p into New Zealand t S "ready-to-GXIJloi ttl economy. MacDonaldis corporation boosts that they sell the "chea:Jest f'aoily meals" in the s t qt e s , Don't be fooled ••• it's cheaper and more nutritious to ea{; at home.