WA government offers up to $4m to reopen Austral Bricks plant as state's sole manufacturer struggles with demand

HouGarden Australia, 29 September — This development concerns the Australian property market and has no direct bearing on New Zealand conditions. It is reported here as a case study in construction supply-chain constraints affecting residential building pipelines.

The funding package — a separate matter from the operations of Midland Brick, which remains Western Australia's sole active brick manufacturer — is structured in three parts: a base payment of $3 million to Austral to restart the Cardup facility, a $500,000 early-reopening bonus if the plant resumes operations by March, and a further $500,000 productivity incentive if the factory produces at least 17 million bricks in its first year of operation. The total available to Austral is therefore capped at $4 million, subject to those conditions being met.

Western Australia Deputy Premier and Treasurer Rita Saffioti announced the funding at a construction site in the Perth suburb of Sinagra. She said the government could not allow high demand to go unmet simply for want of supply. 'It's as simple as that. We can't have a situation where we know we need to build more houses but simply we don't have the bricks,' she said.

Ms Saffioti described the grant as part of a broader effort to sustain housing construction activity. 'This is making sure we do everything possible to continue the momentum of building more homes and also reducing the challenges of increased costs [of] bricks,' she said. Asked why public money was needed given strong commercial demand, she said the government was supporting critical industries 'to get on with it'.

Austral closed its Cardup brickworks in mid-2023. Since that closure, the government says the number of detached homes starting construction in Western Australia has grown by more than 50 per cent year-on-year — a figure that is the government's own, not drawn from an independent statistical agency. That surge in new starts has left Midland Brick, the only other manufacturer operating in the state, struggling to keep pace with orders. Reopening the Austral plant is expected to lift total state brick production by up to 15 per cent — an estimated upper bound, not a guaranteed outcome.

Important uncertainty remains: Ms Saffioti confirmed the government was still negotiating the specific terms of the arrangement with Austral, including whether the company would be required to keep the Cardup facility open for a minimum period. No agreement has yet been signed.

Industry figures at the announcement broadly welcomed the move but said it would not resolve shortages overnight. Dale Alcock, managing director of ABN Group, one of Western Australia's largest homebuilders, said his company had around 100 construction sites currently waiting on bricks. 'Still not enough, so we've still got an issue, but it's certainly a large help,' he said. Mr Alcock pointed to Midland Brick's allocation system as evidence of the depth of the problem, saying it showed there was 'not enough [bricks] currently to go around'. 'At the moment, the industry is more concerned about availability than cost,' he said. 'Cost is critical, but without bricks we get no production.'

Matt Moran, chief executive of Master Builders WA — an industry association, not a government body — said the labour supply problem was equally pressing. 'We need to double down and invest in trades. We need to promote trades more, attract people to apprenticeships,' he said.

Michael McGowan, chief executive of the Housing Industry Association's Western Australian branch — also an industry association — cautioned homeowners against expecting an immediate improvement. 'There is going to be a little bit more time before these bricks become available, and the brick layers and the builders are working really hard to deliver the homes that are currently in the pipeline,' he said, urging patience over the next 12 months.

Mr McGowan said he expected Austral would have no shortage of business once it restarted. 'The home building industry is going to be incredibly busy for the next three to four years, and certainly we would encourage this to be a long-term play,' he said.