https://in.reuters.com/article/idINIndia-53889820110103https://in.reuters.com/article/idINIndia-53889820110103
Mon Jan 3, 2011 12:59pm IST
REUTERS - Torrential rains over thelast two months have devastated much of eastern Australia's commoditiessector, destroying wheat and sugar cane crops and flooding coal mines.
Recovery "will take a significant amount of time," said Australian Prime Minister Julia Gillard.
Forecasters have downgraded the nation's agricultural yields andexports, while some coal miners have suspended production and cancelledshipments, leaving a backlog of empty freighters along the nation'sbusiest shipping lanes waiting
for ports to reopen.
COAL
- Coal mines with an annual production capacity of more than 90million tonnes -- about 35 percent of Australia's estimated 259 milliontonnes of coal exports in 2009 -- are under force majeure.
- Companies typically declare force majeure when they cannot honourlegal contracts due to unforeseen acts beyond their control.
- Queensland produces mostly coking coal, which is exported forsteel-making, but some miners also produce thermal coal used in powergeneration. Queensland's ports currently have an annual coal exportcapacity of 225 million
tonnes.
- The wet weather has pushed up long-term pricing for coking coal, and also pulled up prices for thermal coal.
- The major Queensland coal port of Dalrymple has resumedoperations, but there were nearly 50 ships offshore waiting to beloaded, while the port of Gladstone was operating at a greatly reducedcapacity.
"We have just under 1million tonnes of coal stockpiled. We have a capacity of 6 milliontonnes in our stockpile. We are running a very low stockpile," GladstonePorts Corporation spokeswoman Lee McIvor told Reuters.
- Gladstone Ports Corporation said on Monday that its RG Tanna coalexport terminal is operating at a fraction of its current capacity afterit stopped receiving coal supplies from inland mines last week. Theport has an annual export capacity
of 75 million tonnes.
Mon Jan 3, 2011 12:59pm IST
- Australian rail freight firm QR National reopened its Goonyellacoal rail system in Central Queensland on Friday night after shuttingdown last week due to heavy
rains in the region, allowing coal supplies to be railed to Dalrymple port.
The rail system will then resume coal deliveries from coal mines toDalrymple Bay and Hay Point coal terminals at the Port of Hay Point.the moura rail line is scheduled to reopen on Tuesday.
WHEAT
- Australia is the world's fourth largest wheat exporter and thefloods have caused as much as half the nation's wheat crop, or about 10million tonnes, to be downgraded to less than milling quality due topremature sprouting caused by the
heavy rains, making it unsuitable for milling
- The floods have halted the transportation of all grains inQueensland, GrainCorp Ltd, the country's largest grain handler said onMonday.
"We are unable to moveanything by rail or, of course, road," said David Ginns, corporateaffairs manager at GrainCorp, adding that transport of grain to portelevators from inland areas had effectively ceased, and the domesticdistribution network had also been impacted.
Ginns said the wheat crop in the state of New South Wales (NSW), hitby separate flooding in recent weeks, should not be affected by theQueensland floods.
- U.S. wheat futures rose 1.5 percent in on Monday, buoyed by supply concerns.
SUGAR
- Australia has slashed its current year sugar export forecast by 25 percent as flooding reduced sugar content of cane.
- The damage has helped propel sugar prices to 30-year highs andforced the nation's biggest sugar exporter, Queensland Sugar Ltd (QSL),to buy more raw sugar from Brazil and Thailand.
- Australia, along with Brazil and Thailand, are the world's biggest exporters of sugar for the world market.
- Farmer group Canegrowers estimates up to 18 percent of the 2010 harvest has been left uncut due to rain damage.
(Reporting by Rebekah Kebede and James Regan; Editing by Ed Lane)