Business

Gas and coal exports expected to be stronger in 2013

THE slump in world prices for Queensland's metal-making or metallurgical coal - once the supercharger for the state's economy - is now acting as a handbrake on Australia's export earnings.

Exports of gas and thermal coal - used to produce electricity - are expected to be stronger in the new year even as prices remain low for metallurgical coal.

This is good news for the liquefied natural gas projects sprouting on Curtis Island off Gladstone and the more than 36 thermal mines in Queensland.

But the news will be lamented by the metallurgical coal heartland of Central Queensland's Bowen Basin, already hard-hit by job losses and mine closures.

The latest quarterly report from the Bureau of Resource Energy Economics points to China upping its growing profile in the coming year as India remains more restrained.

That growth means more demand for Australia's thermal coal, oil and LNG as China feeds its insatiable appetite for electricity.

But the lower value of metallurgical coal has had such an impact on the industry that, in total, average export earnings will fall slightly.

Income from metallurgical coal is expected to fall by 24% in this financial year.

This will create a difficult situation for the mining giants because the amount of coal being export is forecast to increase.

So more coal will be dug from the ground compared to previous years, but the profits will be lower than before.

The outlook, according to BREE, is for prices for metallurgical coal to improve towards the end of 2013.

HSBC chief economist Paul Bloxham said Australia was seeing a shift in demand away from the coal used for building and towards the coal used for creating power.

We are no longer relying on China to keep building its giant cities, we are relying on China to keep its lights on.

"We are moving towards being a larger global energy producer," Mr Bloxham said."Japan is looking to shift away from nuclear energy.

"They're demanding more alternatives including thermal coal and LNG."Japan remains Australia's top trading partner for coal.Mr Bloxham said the low prices for metallurgical coal were thanks to a worldwide slump, driven in part by the financial crises faced in Europe."But we're expecting the Chinese economy to be bottoming right now - we see it lifting in 2013."

Topics:  coal, electricity, exports, lng projects, metal




Stay Connected

Update your news preferences and get the latest news delivered to your inbox.

Crabber buys half a tonne of roo meat from mobile meat truck

Roo meat, anyone?

There's roo meat for sale and it's $1.50 per kg

Tourist exodus as Gladstone region town struggles to recover

The Spirit of 1770 up in flames. Photo: Courier Mail

BUNDABERG competitors profit from town's tragic loss.

Tourism business in flight market after reef cat disaster

Lady Elliot Island Eco Resort plane

TOURISM business to make thousands off flights to replace reef cat.

Latest deals and offers

Bennett, Langer, Thurston and others talk Cam Smith

Broncos and former QLD coach Wayne Bennett.

Broncos and former QLD coach plus past and present players talk about Cameron...

Chanelle Ashanti's ute hit outside work

Chanelle Ashanti couldn't believe a big people mover crashed into her fluro ute this morning.

Chanelle Ashanti's ute hit outside work

Chanelle Ashanti's ute hit outside work

Chanelle Ashanti couldn't believe a big people mover crashed into her fluro ute this morning.

Chanelle Ashanti's ute hit outside work

Own Sunshine Coast property? You’re about to make money

UP AND UP: Property owners are likely to win from rent and price increases but tenants and first home buyers might not be so happy. Photo: Brett Wortman / Sunshine Coast Daily

Good new for property owners, not so good for buyers and tenants.

Gladstone's 10 cheapest houses for sale

ALL of the houses are selling for well under $200,000.