Business owners in South Australia's steel city of Whyalla maintain the town still has a bright future, despite speculation around the financial situation of the local steelworks' owner.

The Whyalla steelworks is owned by the GFG Alliance, headed by British billionaire Sanjeev Gupta.

One of GFG's biggest lenders, Greensill, is facing insolvency in Europe, after global wealth manager Credit Suisse froze $US10 billion worth of investment funds that it relied on.

Despite Greensill's troubled financial state, GFG said that its overall position remained strong.

"Our global efficiency drive means that our core businesses are operationally strong and improving.

"We are benefiting from a recovery in steel and aluminium markets, which means that most of our businesses are running at near full capacity to meet high demand and are generating positive cash flows."

State government seeks reassurance

South Australia's Small Business Commissioner John Chapman has written to Mr Gupta seeking a guarantee of payments to hundreds of contractors and suppliers.

"I outlined my request that GFG ensures that payment terms to suppliers are maintained regardless of what happens with his financer Greensill," he said.

"It's the small businesses in Whyalla and indeed further afield in South Australia and indeed across Australia who I don't want to feel the pain from overseas finance companies getting into all sorts of trouble."

Mr Chapman said he had a "very good working relationship" with GFG, and the past issues he raised had been quickly sorted.

"They key to this is what are the financial relationships that GFG has with Greensill and is there any impact on those should Greensill fall into administration or other hands," he said.

"A country that can't make anything really has no future, and to me the steelworks are vital, they're running at near capacity or at capacity at the moment and that's been a great result in terms of the building industry in Australia."

South Australian Treasurer Rob Lucas said the government-appointed Steel Industry Taskforce has also been in contact with GFG.

"They're not prepared to comment at all on the media speculation as they put it," he said.

"However, they have reported to us that in their view their Australian operations are operating well in the current conditions."

Local business owners stay positive

The Whyalla business community also remain confident that the town's local economy will remain strong, despite the steelworks being its biggest employer.

Chairman of the Whyalla Chamber of Commerce and Industry, Malcolm McLeod, said it was "business as usual" in the town.

"I'm sure that it will pass…I'm sure there'll be other funding options being investigated now if they are not already being sourced," he said.

"Anybody that watches the commodity prices will know what iron ore is worth at the moment, so from a cashflow point of view I would suggest that the steelworks at Whyalla and the mine is probably in the best position it's been in for some time."

Anna D'Orazio from Whyalla Jewellers said Mr Gupta still had the backing and confidence of the community.

"I think he's making a really smart investment; I think he has a plan and he's working through his plan," she said.

"We can't expect to see change immediately, it will take time and it will take years."

The Australian Workers Union represents workers at the Whyalla steelworks.

The union said it had reached out to all levels of government and written directly to Mr Gupta to get an understanding of the situation, and cooperate with all parties.