Black gold: Coal cracks $100b record despite China’s ban

Coal might be politically unpopular and on the wrong end of China’s sanctions, but it nevertheless just passed a major milestone for Australia.

A record $110 billion in Australian coal is expected to be exported by the end of the financial year, despite China’s infamous ban on the Australian resource, creating a huge royalty windfall for Queensland.

It will only be the second Australian resource to crack the $100 billion export mark, the Resources and Energy Quarterly March edition will reveal.

The skyrocketing earnings comes off the back of booming prices driven by critical energy shortages in parts of the world – including in China last year.

Coal at the Port of Brisbane

Metallurgical coal, used for making steel, hit a record $650a tonne recently and thermal coal reaching $280 a tonne – well up from budgeted for prices of $130 a tonne and $60 a tonne respectively.

Resources Minister Keith Pitt said the results highlighted the importance of coal to the state and national economy.

“Coal is making a significant contribution to a very successful year for Australia’s resources and energy sector,” Mr Pitt said.

“Critical global shortages in energy and some resource commodities have led to the high prices for some of our commodities.

“These earnings will keep the benefits flowing to all Australians, including through royalties the states use to pay for services such as the hospitals, roads and schools, we all rely on.”

Resources Minister Keith Pitt

The figures have been seized on by the Coalition as it heads into a tight election race, with Capricornia MP Michelle Landry saying the resource was critical to jobs and economic opportunities in the state, particularly in her electorate.

““We can’t risk the future of our coal sector to Labor who’ll be led around by The Greens. It would be the end of central Queensland’s coal mining,” she said.

Blue-collar workers turned on Labor at the 2019 election, after perceived attacks on the coal industry focused around the Adani mine.

Opposition leader Anthony Albanese has significantly shifted the party’s position and has stated the coal export industry will continue under a government he leads and the jobs of miners will not be cut short by his policies.

Coal exports only reached about $40 billion in 2020-21. The first Australian resource to crack $100 billion in exports in a year was iron ore last financial year.

China had been power shortages in some parts of the country around October last year as it ramped up production in the wake of the pandemic, combined with a coal shortage in the country at the time.