Bright outlook for coal

After enduring contract price cuts over the past two years of almost 17% for thermal coal and 23% for hard coking coal, the New South Wales coal industry is looking forward to a reversal of fortune for 2001. Increased export demand, improved prices, significant improvements in mine site productivity, a weak Australian dollar and the probability of a number of new projects or extensions progressing to development are likely to result in an increase in NSW saleable production to around 110 million tonnes (Mt) in 2000-01. Sharply weaker coal prices over the past two years, intensified international competition and the Asian economic downturn had a negative impact on profitability, investment, exports and employment in the NSW coal industry. As a result, the industry has undergone substantial restructuring. The restructuring process has led to a consolidation in ownership, reduced production costs and improved operational efficiency. The outcome is an industry well positioned to take advantage of the positive market conditions and one likely to experience levels of profitability not achieved over the past few years