Coal forecast to earn more export cash than iron ore

COAL is set to overtake iron ore as Australia’s biggest export earner, according to a new report from the nation’s official commodity price forecaster.

Coal shipments are tipped to hit $58.1 billion this financial year, overtaking iron ore exports which are set to come in at $57.7 billion.

The numbers are contained in the latest resources and energy update released yesterday by the Department of Industry, Innovation and Science.

Australia’s total resource and energy export earnings are estimated to have hit a record $226 billion in the recently passed 2018 financial year.

That overall total will hit a fresh record of $238 billion in the 2019 financial year, as surging liquefied natural gas (LNG) exports offset small declines in coal and iron ore earnings.

LNG export earnings are forecast to rise from $30.8 billion in the 2018 financial year to $43.5 billion this financial year.

Coal exports are expected to have generated $60.2 billion in the 2018 financial year — an annual record — split between 182 million tonnes of metallurgical product used to make steel and 200.5 million tonne of the thermal variety used in energy production.

Export earnings from iron ore are expected to have come in at $61.8 billion for the 2018 financial year.

The price of both metallurgical and thermal coal has lifted over the past two years following strong demand for higher quality ores from key markets such as China.

Minerals Council of Australia executive director Greg Evans said the latest forecast confirmed coal’s ongoing resurgence and significant contribution to the Australian economy.

“High-quality Australian coal supports both energy production and steel making,” Mr Evans said.

“The qualities of Australian coal match the needs of the high efficiency low emissions (HELE) coal-fired power plants being built throughout Asia, and our metallurgical coals are amongst the best for modern steel making.”