The presence of hematite and magnetite iron ore in South Australia had been well known, from soon after colonial settlement took place.
There was an increase in pig-iron prices in the early 1870s, which led to the formation of a number of colonial-era iron-making ventures in Australia.
However, this high price did not last long, as iron-making capacity increased and pig-iron was once again imported cheaply as ballast in sailing ships returning from England to Australia.
In 1871, James Martin, at the Phoenix Foundry, in Gawler, had smelted a small quantity of iron, using ore from the Barossa Valley.
This bonus alone would allow the company to recoup much of the £3000 that it had raised in capital to build its plant, and commence operation.
Wallace also analysed the composition of a sample of the company's limestone, which is used as a flux in smelting, and found it suitable.
The only alternative, to shipping coal or coke from other colonies, was to use local timber to make charcoal, to use as the fuel and reducing agent.
horizontal steam engine, with a vertical boiler, and was capable of 700 cubic feet of air per minute.
This is important to ensure that the blast air can flow properly through the burden made up of the materials charged into the furnace.
He was a man of many talents, who had been involved in various businesses—including the 'Nevada Silver Mining Company Limited' and the 'Swan Brewery' in Norwood—and who had a strong long-term interest in the economic advancement of South Australia.
[33] Despite these problems, it seems that the company was optimistic about the future and, in early October, was tendering for charcoal burners to supply 12,000 bushels per month.
According to the manager, C. L. Dubois, the problems had been due to the furnacemen—"two Englishmen, who professed to have a good knowledge of iron smelting by the English method with coke"—but who he claimed had quarrelled about who was responsible for the poor outcomes.
Faced with a lack of relevant technical knowledge in the colony, Dubois consulted a book, "Banermann's [sic] Metallurgy of Iron."
[37] That is conceivably true, but the lack of technical and operational expertise in South Australia seems to be the underlying reason that the furnace could not work reliably.
Dubois, was lamenting the inability of South Australia to exploit its rich iron ore, and that Tasmania was by then leading the way.
[38] The half-yearly meeting, in July 1875, was told that the company had been unsuccessful in recommencing production or in raising additional capital.
There is little left of the South Australian Iron and Steel Company, except its vacant furnace and mine sites[12][45] and its papers in the state archives.