June 19, 2020 Read More →

Queensland mining companies shutting down from low prices, decreased demand

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The miner’s union says hundreds of workers in Queensland’s Bowen Basin will lose their jobs as the industry experiences low coal prices and decreased demand due to the coronavirus pandemic.

CFMEU district vice president Jeff Scales said mining companies across the state are reducing workforce numbers and going ahead with shutdowns, leaving hundreds without work.

“I haven’t seen anything like this in my 15 years in the industry,” he said.

Mr Scales said many mining operators have told the union they are struggling with coal sales and lower profits.

“At this stage there are a number of mines that are having reductions in workforce numbers,” he said.

Tim Buckley from the Institute for Energy Economics and Financial Analysis said coal prices have dropped by 25 per cent in recent months, and mines across the world were now either breaking even with cash flow or dropping into losses.

“The inevitable outcome of that is you are going to have some temporary mine closures … and some job losses,” he said.

Mr Buckley said the low coal prices were tied to the trade war between Russia, the Middle East, and America, and the current coronavirus pandemic.

“That trade war started before the pandemic. But … global economies have been in lockdown and even as they’ve come out of lockdown we’ve seen demand dramatically lower than it was a year ago,” he said.

Mr Buckley said the pandemic has pushed a lot of companies around the world to rethink their energy profile.

“You’ve got firms like tech co [Tech Corporation], which is the biggest utility in Japan, and it’s probably the biggest single buyer of Australian coal and LNG in the world — they’ve just announced an $18 billion investment in renewables.

[Staff Report]

More: Hundreds of coal jobs lost as low coal prices, coronavirus impacts mining

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