Latest news with #metallurgicalCoal
Reuters
30-06-2025
- Business
- Reuters
Coal used to be Australia's commodity export king, but gold is coming: Russell
LAUNCESTON, Australia, June 30 (Reuters) - For decades, coal was the bedrock of Australia's commodity exports before it lost its top status to iron ore as shipments of the steel raw material to China soared. Now coal is at risk of being surpassed by gold. The latest quarterly report from the Australian government's commodity forecaster shows that earnings from exports of the precious metal are expected to rise to A$56 billion ($36.6 billion) in the fiscal year starting July 1. This is higher than the A$39 billion forecast for metallurgical coal and the A$28 billion for thermal coal, according to data released on Monday by the Department of Industry, Science and Resources. Of course, putting the two types of coal together brings a combined total of A$67 billion for expected export earnings in 2025-26, which is still higher than the forecast for gold. But here is where it gets interesting. By the 2026-27 fiscal year, it's quite possible that gold could overtake the combined total for metallurgical coal, used to make steel, and thermal coal, used mainly for power generation. The government expects gold exports to rise to 313 metric tons in 2026-27 from 289 tons in 2025-26 and 250 tons in 2024-25. This would cement Australia's status as the world's biggest net exporter of gold and the third-largest producer. However, the department has been cautious in its price forecast for gold, expecting it to retreat to $2,825 an ounce for 2026-27, down from $3,200 for 2025-26, which is in turn below the current spot price of around $3,273. The government forecaster is traditionally conservative in its price forecasts for commodities and an average of $2,825 for 2026-27 would be at the bottom end of the range expected by most analysts. It's possible that gold will continue its 29% rally since the November election of Donald Trump to a second term as U.S. president, which has seen a range of policies implemented and planned that are viewed as bullish for the precious metal. These include tax and spending policies that would dramatically increase the government fiscal deficit, putting pressure on U.S. Treasuries as a store of value. The sweeping tax cut and spending bill proposed is edging closer to being passed by the Republican-controlled Senate and House of Representatives, and if successfully signed into law it is estimated by the non-partisan Congressional Budget Office that it would add $3.3 trillion to U.S. debt over a decade. There is also considerable uncertainty over Trump's trade and tariff policies, with his early July deadline looming for the United States to reach deals with dozens of major trading partners. Even if deals are reached and they impose lower tariffs than Trump announced in April, it is still likely that imports into the United States will face far higher taxes than they did under former President Joe Biden and during Trump's first term. This adds a positive backdrop to gold as investors are likely to seek alternatives to U.S. Treasuries and other assets, with both investor and central bank buying expected to remain strong. If a more optimistic price is assumed for gold in 2026-27 of $4,000 an ounce, it would yield export revenue of A$61.6 billion, using the current Australian dollar exchange rate to the U.S. currency. That would still be below the government's forecast of a combined A$67 billion for both coal types, but unlike gold the price forecasts for coal may be too optimistic given the likely dynamics in the seaborne market. The government forecast expects metallurgical coal to average $201 a ton in 2026-27 and Newcastle Port benchmark thermal coal $110. Metallurgical coal contracts on the Singapore Exchange ended at $178.50 a ton on June 27, while globalCOAL assessed Newcastle thermal coal at $108.87 in the week to June 27, with both prices being close to recent four-year lows. This means that the government is expecting the prices of both types of coal to increase slightly in coming years, which would require seaborne demand in major Asian markets such as China, India, Japan and South Korea to at least hold steady, if not improve. China and India, the two largest coal producers and importers, are seeking to boost domestic output and lower imports, which may limit their seaborne imports. Japan and South Korea are seeking to use cleaner fuels such as liquefied natural gas, which may also end up being cost competitive with coal given the flood of new capacity expected to hit the market by 2027. If gold maintains its current uptrend and seaborne coal continues to come under pressure, then it is quite possible that gold overtakes coal as Australia's second-biggest commodity export by 2026-27. Enjoying this column? Check out Reuters Open Interest (ROI), your essential new source for global financial commentary. ROI delivers thought-provoking, data-driven analysis of everything from swap rates to soybeans. Markets are moving faster than ever. ROI can help you keep up. Follow ROI on LinkedIn, opens new tab and X, opens new tab. The views expressed here are those of the author, a columnist for Reuters.
Daily Telegraph
08-05-2025
- Business
- Daily Telegraph
Massive $105m deal for humble mining dongas
A massive deal has been approved for a foreign firm to buy four mining donga villages with more than 1,300 bedrooms – coming in over $78,000 a room. New York Stock Exchange listed Civeo Corporation, whose annual revenue last year was over a billion Aussie dollars, has confirmed its purchase of four villages in Queensland's Bowen Basin off a private seller. MORE: Aussie capital named top two city in the world Big Aus bank slashes rates weeks before RBA decision MORE: Quirky solution to housing crisis Artist builds Aus first aircrete dome home Civeo Corp CEO Bradley Dodson said the deal was approved 'earlier than expected'. The $105m deal equates to just over two years of projected revenue that the Bowen Basin deal was expected to bring in for the US-based firm. Mr Dodson said it would 'add annualised revenue and EBITDA of approximately $50m and $27m, or approximately US$32m and US$17m, respectively' to Civeo Corporation's numbers. In a statement to NYSE, the firm said the purchase gives the firm 'unmatched presence and capabilities' in what it said was 'the world's premier metallurgical coal basin'. The deal includes ongoing contracts with new and existing metallurgical coal producers under take-or-pay contracts – which means the firm will get paid whether companies use the dongas fully or not. MORE: See the Aussies who put their pets first when buying a house Un-beer-lievable: SEQ costlier than Melbourne for housing, food, grog The firm already has a strong Queensland presence with Coppabella Village between Moranbah and Nebo, Dysart Village, Middlemount Village, Moranbah Village, and Nebo Village; two in New South Wales – Boggabri Village and Narrabri Village; and one in Western Australia – Karratha Village. All up before this deal, Civeo owned and operated 28 lodges and villages across Australia and North America with about 27,500 rooms, and also provides hospitality services at 22 customer-owned locations with over 18,000 rooms. Civeo Corporation operates in the hospitality services zones within the resource sector, accommodating hundreds or thousands of workers in long-term and temporary accommodation, providing food, housekeeping, facility management, laundry, water and wastewater treatment, power generation, communications, security and logistics. Mr Dodson said 'we have updated Civeo's 2025 guidance to reflect the expected revenue and Adjusted EBITDA contributions from these newly acquired villages and look forward to deepening our relationships with our customers in the Bowen Basin.' MORE REAL ESTATE NEWS
News.com.au
08-05-2025
- Business
- News.com.au
Massive $105m deal for humble mining dongas
A massive deal has been approved for a foreign firm to buy four mining donga villages with more than 1,300 bedrooms – coming in over $78,000 a room. New York Stock Exchange listed Civeo Corporation, whose annual revenue last year was over a billion Aussie dollars, has confirmed its purchase of four villages in Queensland's Bowen Basin off a private seller. Big Aus bank slashes rates weeks before RBA decision Civeo Corp CEO Bradley Dodson said the deal was approved 'earlier than expected'. The $105m deal equates to just over two years of projected revenue that the Bowen Basin deal was expected to bring in for the US-based firm. Mr Dodson said it would 'add annualised revenue and EBITDA of approximately $50m and $27m, or approximately US$32m and US$17m, respectively' to Civeo Corporation's numbers. In a statement to NYSE, the firm said the purchase gives the firm 'unmatched presence and capabilities' in what it said was 'the world's premier metallurgical coal basin'. The deal includes ongoing contracts with new and existing metallurgical coal producers under take-or-pay contracts – which means the firm will get paid whether companies use the dongas fully or not. Un-beer-lievable: SEQ costlier than Melbourne for housing, food, grog The firm already has a strong Queensland presence with Coppabella Village between Moranbah and Nebo, Dysart Village, Middlemount Village, Moranbah Village, and Nebo Village; two in New South Wales – Boggabri Village and Narrabri Village; and one in Western Australia – Karratha Village. All up before this deal, Civeo owned and operated 28 lodges and villages across Australia and North America with about 27,500 rooms, and also provides hospitality services at 22 customer-owned locations with over 18,000 rooms. Civeo Corporation operates in the hospitality services zones within the resource sector, accommodating hundreds or thousands of workers in long-term and temporary accommodation, providing food, housekeeping, facility management, laundry, water and wastewater treatment, power generation, communications, security and logistics. Mr Dodson said 'we have updated Civeo's 2025 guidance to reflect the expected revenue and Adjusted EBITDA contributions from these newly acquired villages and look forward to deepening our relationships with our customers in the Bowen Basin.'
