News Wrap

IN this morning’s News Wrap: Newman rejects Palmer’s coal production estimates; BHP report not without blemishes; and iron ore miners expand despite slowdown concerns.

Staff Reporter

Newman rejects Palmer’s coal production estimates

Clive Palmer has lost his bid to avoid a full environmental assessment on a proposed open cut coalmine in central Queensland after the Newman government rejected his companies' estimates of annual production, according to The Australian.

The businessman and political aspirant's companies had told the state government that the Styx Coal project, north of Rockhampton, would produce 1.9 million tonnes of coal, just below the 2Mt a year requiring an environmental impact statement under the Environmental Protection Act.

BHP report not without blemishes

The latent capacity that has been building up inside BHP Billiton courtesy of its massive investment programs of recent years came out of hiding in a big way in the June quarter, according to The Australian.

Former chief executive Marius Kloppers told the market it was coming, and so it has.

The production report released yesterday was a strong one. But it won't be enough to offset the impact of lower commodity prices on the group's June year profit – to be announced next month – that is expected to tumble from $US17.1 billion to a little more than $US12bn.

Iron ore miners expand despite slowdown concerns

Concerns over Chinese demand for iron ore has failed to curb expansions by the world’s biggest iron ore miners. The annual seaborne trade of the steel-making commodity is forecast to rise to a massive 1.7 billion tonnes in five years, according to the Australian Financial Review.

BHP Billiton, Rio Tinto, Fortescue Metals and fellow Pilbara-based iron ore junior Atlas Iron all intend to push ahead with significant iron ore expansions, adding substantial tonnes to the export market at a time when China, the miners’ biggest customer, is predicted to cool steel-making.

Rio, the world’s lowest-cost producer, reported record first-half production of iron ore on Tuesday, and affirmed it would expand its Western Australian-based capacity to 290 million tonnes a year by the end of the third quarter.

The global miner’s board is set to make a decision later this year on whether to spend an extra $US5 billion to ramp up production to 360 million tonnes a year.