How China's coal ban will affect Illawarra mines

The Illawarra produces the higher grade metallurgical coal.
The Illawarra produces the higher grade metallurgical coal.

Illawarra mines will be largely unaffected by China's plans to reduce coal imports.

From next year, the Chinese government will limit the use of imported coal with more than 16 per cent ash and 3 per cent sulphur in a bid to improve air quality, especially in cities such as Beijing and Shanghai.

But the reduction relates to thermal coal, while the Illawarra produces the higher grade metallurgical coal.

"Traditionally, we're low-ash metallurgical coal, so it's my belief that broadly the Illawarra should not suffer," said CFMEU south-western district vice-president Bob Timbs.

"For us I don't think it will mean anything.

"I can't see it having much of an impact on Illawarra mines."

He said Illawarra coal was well below that 16 per cent ash figure. NSW Minerals Council chief executive Stephen Galilee also said the region should not be concerned.

"The Illawarra region has some of the best quality coking coal in the world and is not affected by the proposed regulations," Mr Galilee said.

He also doubted there would be any impact statewide.

"There is no evidence to suggest that NSW thermal coal exports to China would be significantly affected by the proposed regulations of China's National Development and Reform Commission," he said.

"Global competitors that produce lower quality thermal coal are more likely to be affected."

Economic impact of mining ‘overinflated’

PEOPLE’S perception of mining’s importance to the economy is often ‘‘overinflated’’, according to the Australia Institute’s Rod Campbell.

Mr Campbell, a researcher and economist, has been invited to Wollongong by the group Illawarra Residents for Responsible Mining to  talk on Friday.

Mr Campbell said the Australia Institute, an ‘‘independent think tank’’, had been studying the Hunter and NSW in the importance of the coal industry.

‘‘The Australia Institute more recently has done things on perception of the mining industry and its economic impact and finding those perceptions are heavily inflated,’’ Mr Campbell said.

‘‘That accounts for the political power of the mining industry in NSW and in Australia more generally.

‘‘We ran a survey late last year asking people what sort of percentage of state government revenues they thought came from coal royalties. 

‘‘The average public perception is about 20per cent but it’s actually only  2per cent.

‘‘In the Hunter, people thought  20per cent of the Hunter workforce worked in the coal industry, but even in the Hunter it’s only 5per cent. In NSW it’s between one and 2per cent.’’

In the Illawarra mining industry there is a constant threat of job losses. While Mr Campbell sympathised with those who might lose their mining jobs, he was doubtful a decrease in mining would have a ripple effect on the Illawarra economy.

‘‘Only about 3000 people out of the Illawarra’s 120,000-strong workforce are in the mining industry, so only 2.6per cent of the Illawarra’s workforce are in mining,’’ he said.

‘‘The Illawarra, like the rest of Australia and like most modern economies in the world, is really based on services.

‘‘It’s based on healthcare, retail, education and training.’’

Mr Campbell’s free talk is on Friday, from 7pm in the Lillypilly Room at Corrimal Community Centre.