Witnesses to a nation-changing event
TECHNOLOGY will keep Australia's mining industry powerful even as the value of our resources begins to tumble.
That's the view of Mines Minister Martin Ferguson who predicted that as mineral prices settled, new ideas and increasing the amount of coal being exported would be the key to ensuring the booms continue.
During a speech at the Australian Minerals Research Centre in Perth, he re-affirmed that "Australia is currently in the midst of the greatest mining boom in our history".
"We are witnessing a nation-changing event."
But he said for the nation to remain competitive as other countries benefit from paying lower wages, Australia must "develop and deploy technology".
International prices for coal - both thermal and coking - are down from the astronomical points they reached over the past five years.
Queensland has more than 35 thermal and 29 coking coal mines.
Queensland Resources Council chief Michael Roche said this was a long-term battle, but growing the state's mining industry would protect against those trying to steal Australia's customers.
"Not only do we have new resource provinces in Africa, Asia and the Americas in direct competition, but the reality is that Australia is at the high end of the production curve," he said.
"Additional royalties and corporate taxes are not worth anything if minerals and energy companies are priced out of the marketplace."
But a fall in revenue does not mean the country's mining industry is on its knees.
Mine companies plan their projects to deliver profits for decades, not to rely on spikes in coal prices.
The Bureau of Resources and Energy Economics June quarter report found thermal coal exports would be worth 24% more in this financial year compared to the one before - totalling $17.4 billion.
In 2012-13, with more than 179 million tonnes being exported, any fall in prices is easily offset, pushing earnings for thermal to $18.6 billion.
From 2009, when coking coal - used to make steel - hit record highs of between $300 and $450 per tonne, in 2012 that price was closer to $221 a tonne.
For 2011-12, a 1% increase in exports would deliver $30 billion in earnings.
In the next financial year, even with prices falling slightly, 13% more coking coal will be exported, meaning that earnings will fall to $29.7 billion.
PRICES A MINE FIELD
- Thermal coal is used in power plants to create electricity.
- Coking or metallurgical coal is used in smelters with iron ore to create steal.
- Australia is the largest exporter of coking coal in the world.
- BHP is the world's biggest single coking coal exporter.
- In 2009, coking coal was worth between $350-$450 and thermal almost $130 per tonne.
- It was matched in 2011/12 as flooding cut supply, forcing higher prices.
- Coking prices are now closer to $200 a tonne.
- Thermal is now closer to $100 a tonne.