A recent report says coal prices will fall significantly and exports from Australia’s biggest coal port will decline if Adani’s giant coal mine in north Queensland goes ahead and it has also highlighted deep divisions behind the scenes in the coal industry over the federal and Queensland governments’ support for subsidies for the giant mining project.
The report found Adani’s mine could add about 40 million tonnes a year of capacity to the market and Queensland is believed to be offering Adani discount on mining royalties during initial phase, which could amount to almost $1.2 billion in lost revenue.
From a case consensus forecast of $68.80 a tonne global coal prices would fall by nearly $3.80 a tonne to $65.00 and competition from Adani’s Queensland mine would reduce exports from Australia’s largest coal terminal at the port of Newcastle by 11 to 12 million tonnes a year equivalent to the output of a Hunter Valley coal mine.
A giant new Queensland coal mine subsidised by the federal and state governments sparks debate, and has displaced the prospect of jobs and mining royalties in New South Wales.
Although the coal that would come out of the Adani mine is of considerably inferior quality, it will reduce the demand for the high-quality coal produced in NSW. This is not only bad for the environment, but it’s bad for the workforce, the NSW economy will take a hit, and damaging for the existing NSW thermal coal mines.