News Wrap

IN THIS morning’s News Wrap: commodities sector chides ‘absurd’ Labor; Rio's production outlook hit; and coal gas ruling leaves miner's future on hold.

Staff Reporter

Commodities sector chides ‘absurd’ Labor

The Minerals Council of Australia has challenged the federal government’s declaration that the China-led mining boom is over, while a top international funds manager executive describes Australia’s financial situation as “absurd”, according to the Australian Financial Review.

Minerals council deputy chief executive John Kunkel said the government’s description of the economy had varied wildly within the space of a year, from depicting the mining industry as “giant national lolly shop” to declaring the China-led boom over.

He said the easy gains from higher prices for minerals might well have finished, but Australia could be successful if it managed volume growth.

He said the biggest challenge was getting policy right.

“The correct response is not to throw our hands up in despair or, even worse, to toy with policies that further undermine our competitiveness,” Kunkel told an event in Sydney.

Rio's production outlook hit

Unseasonal rain and a conveyor outage have hit Rio Tinto's West Australian iron ore production in the normally strong June quarter, leading to weaker shipments than analysts were expecting and raising questions over whether full-year guidance from the big miner's most profitable unit will be met, according to The Australian.

The outages and delays, of which the weather component is also affecting Fortescue Metals Group and BHP Billiton, are helping buoy Chinese iron ore prices, which are widely expected to slide in the second half of the year as production expansions come on.

Coal gas ruling leaves miner's future on hold

A mining company worth $24 million has put its future on hold after the Queensland government released a report yesterday preventing any future commercial mining developments using the controversial underground coal gasification method, according to The Australian.

Carbon Energy, one of two companies conducting UCG trials in Queensland, requested a trading halt immediately after the government released the report.