Latest trade data confirms the resilience of Australia’s resources sector, with coal exports on the rise despite recent challenges such as the pandemic and the trade spat with China.
Resources minister Keith Pitt said the value of the country’s coal exports in December increased by an impressive 26 percent from November.
Coal exports inject $3.7-billion into economy
“Coal was worth $3.7-billion to the Australian economy in December alone as exporters looked to fill gaps in international markets and made the most of the increase in thermal coal prices,” he announced.
“In the middle of the Northern Hemisphere winter, it’s not surprising that thermal coal accounted for most of the increase to meet the demand from power utilities.”
Pitt said coal sales to Vietnam and India were stronger, reaffirming the competitiveness of Australian coal and its international reputation for high quality.
Coal an important export ‘for years to come’
“This again reinforces the importance of coal as an Australian export commodity and that it will remain so for many more years to come,” he stated.
According to the minister, the latest trade data also confirms that, despite the global challenges presented by the pandemic, Australian resources and energy exports were valued at a “phenomenal” $272.5-billion in the 12 months to December.
“The result is a great testament to the work of our resources industry to maintain full operations throughout 2020 as the coronavirus pandemic wreaked havoc on many other industry sectors across the world,” he said.
Sign that global production increasing again
“These results are also an encouraging sign that many countries are looking to resume industrial production as economies recover and that is good news for the Australian resources sector.”
In mid-2020, as the pandemic raged and Chinese authorities reduced or halted Australian imports due to a trade spat, there was speculation that Australia could be about to see its market decline more rapidly and deeply than originally expected as the pandemic changed the world’s energy consumption habits.
In the longer term, though, coal exports could still be in permanent decline as the world seeks new, cheaper and more environmentally sensitive alternatives.
Has the pandemic exposed coal’s vulnerability?
A report published last year by the BBC’s Chief Environment Correspondent, Justin Rowlatt, observed that keeping much of the world’s population at home due to Covid-19 had led to an unprecedented fall in energy demand, including demand for electricity.
This had, in turn, revealed the underlying vulnerability of coal – the fuel that powered the creation of the modern world.
“Like a tide withdrawing, the crisis has exposed just how fragile the financial foundations of this dirtiest of all fossil fuels have become,” Rowlatt said. “Some industry observers are even saying that coal may never recover from the pandemic.”