The employment of 70 Australian seafarers remains in limbo after BHP and Bluescope announced plans to end the use of their last two locally-run iron ore freighters.

Key points: The future of crews of two Australian-run iron-ore shipping vessels is in doubt

The future of crews of two Australian-run iron-ore shipping vessels is in doubt The Maritime Union of Australia claims Bluescope and BHP are moving towards a cheaper workforce

The Maritime Union of Australia claims Bluescope and BHP are moving towards a cheaper workforce The two companies said it was important for local manufacturing operations employing 6,500 Australians to remain viable

BHP and Bluescope have had contracts with shipping firm Teekay Australia since Bluescope was publicly listed in 2002 — but the agreement is set to expire in June this year.

Crewmen aboard MV Mariloula and MV Lowlands Brilliance — which move iron ore from BHP in Port Hedland to BlueScope's steelworks in Port Kembla before running coal to China — learned of the decision while on shipping runs in the South China Sea and the Coral Sea.

Maritime Union of Australia Secretary Paddy Crumlin has savaged the decision, saying it will mean the end of a century-long tradition of Australian-crewed ships supporting the steel industry.

"Newcastle and Kembla were built by these ships, they all come from that community, always have come from that community and still should as long as there's a steelworks," Mr Crumlin said.

"This is disgraceful stuff."

Mr Crumlin accused Bluescope and BHP of angling to employ cheaper workers.

"They are basically dumping Australians so that they can avoid tax, and get crews that get paid $5 or $10 a day, pretty contemptible."

Lack of information

Iron ore is shipped from Port Hedland to BlueScope's steelworks at Port Kembla in Wollongong, south of Sydney. ( ABC News: Nick McLaren )

The tankers are owned by Teekay Shipping and the company says it intends the fly the crews back home after they disembark in China.

"In total 68 employees of Teekay consisting of deck officers, engineer officers and ratings are employed to crew the two vessels," Teekay said in a statement.

"No decision has been made regarding the continued employment of the crew, and the company is examining whether there are redeployment opportunities."

James Scott is onboard the Mariloula, which is anchored in the South China sea off Hong Kong.

He said workers were exhausted and nervous about their future.

"We have no idea," Mr Scott said.

"We have no idea when we're getting off, we have no idea what's going to happen.

"There's obviously industrial action laws in place with regards to the crew with what will happen with redundancies and the like, but that pales into insignificance with the lack of information and being dumped in a foreign port as an Australian seafarer.

"This is absolutely unacceptable."

He said they were maintaining contact with crew on board the second vessel.

"Maritime are a very, very tight knit community we care for each other and we just want to make sure our comrades on the other vessel are ok, we are just trying to look after each others welfare as best as we can."

Exploring future options

In a statement the two companies [BHP and Bluescope] said that since the original iron ore supply contract was put in place some 17 years ago, the nature of the iron ore market has changed fundamentally.

"BlueScope operates in the highly competitive, trade-exposed, global steel industry.

"We must ensure that we have internationally competitive raw material supply arrangements, so our local manufacturing operations, which employ 6,500 Australians, remain viable," the statement said.

They said they were exploring options for the future.

The Deputy Prime Minister, and Minster for Transport, Michael McCormack, said he had been made aware of the decision, but it was an entirely commercial decision.

He has also blamed the Labor party for creating regulatory settings that is not working.

"The current regime, put in place under the Labor government, has failed to revitalise the Australian shipping industry," he said.

"The Government is committed to ensuring that the right regulatory settings exist in order for shipping to takes its rightful place as part of the national transport system."