North Australia Digest – 5/11/20125 November 2012
Australian Financial Review
The federal government’s energy white paper is expected to push benefits of more deregulation and privatisation of the energy supply industry by state governments. Robert Pritchard, executive director of the Energy Policy Institute, expects the white paper ‘will be much more explicit about the supply and demand problem in relation to domestic natural gas’.
The Minerals Council of Australia (MCA) said a Greens call to renegotiate the mining tax would cost jobs and threaten investment. In a submission to a Senate Inquiry, MCA says the industry is already highly taxed and that iron ore prices are suffering as a result.
The mining industry says the government should have expected the proceeds from the mining tax to be highly volatile in the wake of the government’s $1.5 billion tax shortfall. ‘The MRRT’s tax base is highly dependent on commodity prices and exchange rates – themselves both volatile and variable’ says the MCA.
With the recent slowing in the mining sector, the $450 million expansion plans of the Tanami Mine in the Northern Territory have been shelved. The move provides job insecurity for workers in the region.
Australian farmers could be squeezed out as New Zealand producer-owned dairy giant; Fonterra has signed a partnership agreement to develop two more dairy farms in China. Kelvin Wickham, Fonterra’s China president, says ‘the demand for dairy products in China is expected to double by 2020. We need to build a safe, sustainable local milk supply to feed this growth’.
Australia’s mid-tier miners are feeling the pinch from the global slump in commodity prices, with profits tumbling by almost half in the past year.
The West Australian
Australia’s mid-tier miners are well placed to benefit from any economic stimulus by China’s incoming leadership, despite being hit by falling prices and rising costs over the past year, according to a major study by PWC of the sector. ‘With big miners deferring projects in the face of commodity price downturns, there were opportunities for mid-tier companies to capture the next phase of growth after their increased investment through the 2011-12 fiscal year’.
The Courier Mail also reports on the study by PWC, which says Australia’s mining companies have reason to be optimistic despite a difficult past 12 months.
The 1800 strong workforce at the Nhulunbuy bauxite mine face future ‘uncertainty’ as Pacific Aluminium said it was considering shutting down operations early next year.