Hogsback on coal's place in the mining pantheon

HOGSBACK reckons that coal has for far too long been considered the ugly duckling in Australia’s suite of minerals exporters. It may not be as flashy as gold and not as dominant as iron ore, but over the years it has been consistently delivering despite all the nay-sayers.
Hogsback on coal's place in the mining pantheon Hogsback on coal's place in the mining pantheon Hogsback on coal's place in the mining pantheon Hogsback on coal's place in the mining pantheon Hogsback on coal's place in the mining pantheon

Coal always seems to get criticised for its alleged effect on the environment but never gets praised for its achievements.


Even the nation's mining peak body, the Minerals Council of Australia, failed to mention coal's contribution with the release of the latest Australian Bureau of Statistics trade data.   


MCA CEO Tania Constable spoke about the strong contribution of mining generally and gave special attention to iron ore.


"When mining is strong, Australia wins," she said.


 "In May 2019, Australia's world-class resources sector generated a record high $24.9 billion in export earnings for the nation, or 60% of total export income.


"This is also a record-breaking month for Australia iron ore exports, which accounted for $8.8 billion in export earnings.


"Other Australian minerals and metals exports including gold, copper and nickel contributed $6.6 billion in earnings."


Why no mention of coal?


Iron ore's stakes have recently lifted only because of an incident at a Vale mine in Brazil that saw a dam burst and subsequently put into question that company's ability to maintain its iron ore exports to China.


According to the ABS figures, coal accounted for $5.7 billion in May, which was 3% higher than the previous corresponding period. Surely, that is a substantial contribution to the national economy.


Met coal has been having a few very good months, according to broking house Bell Potter.


"Met coal prices have outperformed expectations over the last six months," it said.


"In the June 2019 quarter, hard coking coal prices averaged US$203 per tonne and thermal coal prices around $80/t. Compared with our forecasts for the period, hard coking coal was 5% higher and thermal coal 5% lower."


Coal is subject to the vagaries of world markets like any other commodity but the Australian coal industry is resilient and adaptable enough to keep operating through the cycles.


This is mainly due to the high skills of its workforce and the industry's ongoing investment in automation and innovation.


It is also a testament to the perseverance of coal mining companies who remain determined to negotiate the regulatory minefield and develop new coal projects that bring employment and investment to our regions.