Despite fierce cost cutting across the Australian coal sector, industry veterans are tipping more mine closures this year, as losses for a growing number of miners for the first time balloon out to exceed the fixed costs of their port and rail contracts. The industry is in survival mode.
Queensland Resources Council president Michael Roche says 10 per cent of miners in the state are in a “very precarious position”, particularly in lower grade coking coal and thermal coal.
Fresh figures from the council show a quarter of the state’s coal output is produced at a loss, including half of all production of thermal coal, used in power stations. One in 10 tonnes produced at Queensland coal mines is done so at a loss of more than $14 a tonne, Mr Roche says. Industry sources say the situation is similar in New South Wales.
source - Financial Review 28 May 2014
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