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With key mining towns like Emerald badly flooded, and damage to QR National’s rail network, the impact on the coal supply chain and labour supply will also hamper long-term recovery efforts as nine coal companies have declared force majeure on coal contracts.
Queensland Premier Anna Bligh, who has established a recovery fund for flood-stricken towns to which Xstrata, BHP Billiton and Rio Tinto have contributed, said the floods would have a long-term effect on the state’s coal industry.
“We have three quarters of our coal fields unable to operate and unable to supply markets. There's likely to be a significant long-term effect from that, not only nationally but internationally,” she told ABC's 7.30 Report.
“Queensland supplies half of the world coking coal needed in steel manufacture so there is a remarkable problem out there.
“The mining companies and the mining communities are playing their role in trying to help the recovery effort ... but they will have a long slow climb back into production.”
QR National, which listed recently at a premium on the promise of transporting coal on its rail networks to Queensland ports, said it could still be several days before trains could operate again on lines linking coalmines with coal loaders at Gladstone.
Even after the lines are reopened there will be limited coal production from the mines, which will need a few months to ramp back up to full production.
QR National reopened its biggest rail system, Goonyella, on New Year's Eve after flooding forced its closure on Christmas Eve, but at a reduced capacity.
The Moura rail line is expected to reopen today.
Queensland Resources Council chief executive Michael Roche has said the coal mining industry is losing $A100 million a day in exports with about $1 billion of exports already suspended.
The state is the main exporter of coking coal to the world’s emerging markets of China and India, and the floods are expected to create shortages which could see the price of coal rise.
Macquarie Commodities Research is predicting an increase from $US246 dollars a tonne to $US300/t and believes this could be reflected in the next round of quarterly export contracts.
