The Economic Consequences for the Coal Industry in Australia from the Earthquake and Tsunami of Japan, March 2011

The Economic consequences for the Coal Industry in Australia from the earthquake and Tsunami of Japan, March 2011

Lara Brett

Friday May 20th, 2011

WORD COUNT: 1429

On March 11th, 2011 Japan suffered an Earthquake of significant magnitude just off it’s Eastern Coast, measuring 8.9 on the Richter scale. The ‘Sendai Earthquake’ as it is now known has had disastrous influence on the Japanese economy as well as global economic impact. Australia has felt the effects within its booming Coal Industry. In this report, we will comment on the economic role Australian Coal production plays for Australia, the economic ramifications this natural disaster has caused currently, and forecast the possible future economic consequences for Australia.

Mining of black coal is one of Australia's most important industries, creating significant employment, fuel for low-cost electricity generation and steel making, and is a vital source of export revenue. Australia is the world's biggest coal exporter and black coal is Australia's largest export. In addition to providing Australian consumers with affordable electricity, coal underpins the international competitiveness of the entire Australian economy, as well as being a major force driving the social and economic development of regional areas. According to the 2010 BP Statistical Energy Survey, Australia had coal reserves of 76,200 million tones in 2009, 9.22% of the worlds total and produced 409.22 million tones. This allows Australia a competitive role alongside the world's other major producers of China, the USA, India, Russia, Indonesia and South Africa.

Japan relies on coal predominantly for Energy resource. It has few domestic energy resources and is only 16% self-sufficient. Domestic Coal production in Japan came to an end in 2002 yet demand has remained consistent with an estimated 182 million tones used in 2009. This demand has made Japan the world’s largest importer of Coal. Australia is a major supplier of...