Queensland Deputy Premier and Treasurer Jackie Trad is quoted in the Courier-Mail today on the future of thermal coal in Queensland:
QUEENSLANDERS working in thermal-coal mines should start reskilling now to prepare for the decline of the industry, according to Treasurer Jackie Trad…
…“The fact of the matter is, economics is moving away from thermal coal, communities are moving away from thermal coal, nation states are moving away from thermal coal,” she said. “What we need to do as a coal exporter is understand that and equip our communities with the best possible chance of reskilling, and that’s why we’re focused on other materials.”
This sounds pretty sensible to me and consistent with recent developments globally which I discussed in my most recent QEW Week That Was video. While I have been critical of the state government for its flip-flopping approach to the Adani Carmichael mine (e.g. from p. 212 of my book Beautiful One Day, Broke the Next), this latest statement from the Treasurer is economically sound.
I’ve previously posted on this issue (Coal, climate change, solar & batteries – why Qld Treasury wanted to offload the state’s energy assets), and have noted that the Mackay and Central Queensland regions are especially vulnerable to any changes in global sentiment and demand for coal (see chart below).
Queensland Economy Watch 
As the King pf Saudi Arabia said “the age of oil is over, the age of graphene has begun”.
Graphene can be made from coal. Demand will be a multiple of current coal demand.
Thanks for the comment, Peter. I’ll have a closer look at graphene. Let’s hope that’s the case.
The second graphic is pretty obvious when you know the regions. After the mining boom ended in 2012/13 house prices in Mackay and the Whitsundays really started to drop bottoming in 2015/16. Down about 30%. The Whitsundays was also compounded by a fall in tourist numbers because of the high AUD. Whitsundays is starting to see some pickup in house prices as tourism recovers and I suspect there are more mining jobs around. If the Adani Carmichael mine ever goes ahead this will have a positive impact. I don’t know how Mackay is going as it does not have as much tourism.
PS I don’t th8nk infilled in my details on my previous comments on Jack Trad.
Hi Russell, thanks for the comments. Very interesting points. Mackay is doing well at the moment thanks largely to the resurgence of mining.
I’d go a little further and say that the Treasurer’s statement is a highly praiseworthy – which is to say politically courageous – act. It’s the kind of thing which reached its highpoint with the Hawke/Keating Government and then declined under Howard (with noble exceptions in the area of gun control and the GST – though I was amongst a minority of economists who didn’t think it was good policy). Rudd and Gillard showed some bottle on the fiscal stimulus before apologising for it and flip/flopping on climate change. Since then Australian politicians have led the most hand-to-mouth existence I’ve ever witnessed.
Thanks for the comment Nicholas. Yes, we haven’t been well served by our politicians in recent years.
Gene, I reworded this to make it less political….
I don’t agree because not all coal is the same so even if world demand decreases slowly over a long time which is expected then what the federal and state governments should be doing is making the case here and overseas that our coal is higher energy, less ash and less sulphur than Chinese or Indonesian coal. Therefore, even in a world where thermal coal is under pressure then ours should be the last to lose demand. I can see us mining coal for a few decades yet. Thermal coal price is high and new technology, higher thermal efficiency power stations are being built.
The case for Adani can be argued that way. To me anti-Adani protesters are if successful are inadvertently condemning the world to higher greenhouse gas emissions, more dust and more toxic pollutants because Indian or Indonesian coal will be used instead.
FYI. A good graphic can be found in the Yancoal interim report released yesterday on the ASX. Shows the progress of higher technology coal power generation thermal efficiency combined with relative qualities and quantities of thermal coal from the major exporting countries.
Great, thanks for the comment Russell. Matt Canavan has been very good at making that argument about the higher quality of Australian coal I recall. Certainly that will insulate us to an extent. I’ll have a closer look at the sector and try to post on it again soon.