MANAGEMENT

Union warns on coal mining growth

THE Australian coal mining industry is not entering another “Super Cycle” like it did earlier this decade with a more sustained outlook likely as developed nations move out of coal, the mining union warns.

The CFMEU has warned that coal markets may not keep growing.

The CFMEU has warned that coal markets may not keep growing.

The Construction Forestry Mining and Energy Union said while it was encouraging that the industry had exported $60.1 billion in 2016-17, it would be wrong to forecast endless growth.
 
"Coal use is growing in certain smaller Asian markets like Vietnam, but is declining in many parts of the world," it said.
 
"Australia has been growing its market share in an overall flat market, but that is not a situation that can continue indefinitely. Most forecasters expect thermal coal prices and revenues to decline - they mainly differ about the pace. 
 
"And although demand for metallurgical or coking coal for steelmaking has longer term prospects than thermal coal for power generation, it too is forecast to decline in price and revenue terms from current highs - at least in part because of higher rates of steel recycling."
 
Japan, has had to rely a bit more on Australian coal than expected after the shutdown of its nuclear power industry after the Fukushima disaster.
 
However, according to the CFMEU, it is seeking to limit that growth. 
 
"The biggest coal producer and consumer in the world, China, appears to be pulling the strings in the global thermal coal market to maintain the market price at a level that doesn't force Chinese producers out of business rapidly, but is still seeking to reduce coal consumption," the union warned. 
 
"That manipulated market price - about US$85 to $95 per tonne - suits Australian producers. But it is a highly vulnerable situation to be in."

 

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining Monthly Intelligence team.

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining Monthly Intelligence team.

editions

Mining Magazine Intelligence Future Fleets Report 2024

The report paints a picture of the equipment landscape and includes detailed profiles of mines that are employing these fleets

editions

Mining Magazine Intelligence Digitalisation Report 2023

An in-depth review of operations that use digitalisation technology to drive improvements across all areas of mining production

editions

Mining Magazine Intelligence Automation Report 2023

An in-depth review of operations using autonomous solutions in every region and sector, including analysis of the factors driving investment decisions

editions

Mining Magazine Intelligence Exploration Report 2023 (feat. Opaxe data)

A comprehensive review of current exploration rates, trending exploration technologies, a ranking of top drill intercepts and a catalogue of 2022 Initial Resource Estimates and recent discovery successes.