Director of the company, Mr. Adam Furphy, said that substantial rises in the two major cost inputs employed in hot dip galvanizing – zinc metal and fuel had made the decision necessary.

Seventeen local employees will be affected by the closure. However, Mr Furphy said all their entitlements will be met and redundancy packages will be offered.

"We set out to create a decentralized galvanizing business in Blayney supporting the steel fabrication, manufacturing and agricultural industries in the Central West as well as attracting business from the western Sydney metropolitan area.

"We have in fact grown the volume of steel which comes to Blayney for galvanizing significantly but have been unable to develop a sustainably profitable business. The extraordinary increase in zinc cost, combined with rising transport costs, now places us in a situation where we can no longer operate the business.

"The Directors of the company have determined that it is prudent to cease operations now as there is no sign of relief to our rising cost inputs."

Mr Furphy added that he anticipated that it would take several weeks to wind down the final projects and deliveries to customers after which he anticipates that the company owned premises in Blayney will be offered for sale.

Blayney Galvanising is a member of a long established group that has similar galvanizing plants in Shepparton, Geelong and Albury.

These operations are unaffected by the decision to close the Blayney plant.