MARKET UPDATE Boom not over but “easy days” are: golding contractors Source: Shift Miner 10th Oct 2012
CHIEF executive of Golding Contractors Geoff Caton told more than 230 people at an industry conference in Gladstone today that the “resources boom” is far from over. Golding Contractors is heavily involved in both the CSG infrastructure development going on in Gladstone, as well as in coal mining across Central Queensland. The comments coincide with the official closure of the BMA Gregory Crinum mine, where more than 200 Golding employees recently lost their job. However, Mr Caton said the closure of Gregory Crinum and Norwich Park mines earlier in the year has been more than offset by expansions in the coal fields. “There are currently 63,000 people employed full time in the Queensland resources sector, and we have seen sustained increases in the export volumes of coal in Queensland,” he said. “Norwich Park and Gregory Crinum are high cost BMA mines and they are near the end of their mining life. “What is not often talked about in the media is that BMA are more than replacing the lost capacity [of these two mines] through their new greenfield projects. “Currently Golding has more than 500 people back working on the Daunia project trying to get it to market.” Mr Caton was also quick to point out that the “easy days” of the boom are probably over for mining companies and the Australian economy.
He says commodity booms have three phases: an escalating commodity price and demand phase, followed by a capital investment and expanding supply phase, and ending with a lower price but expanding volume phase, which he says, could run for many years yet. “During the volume period the key driver has got to be productivity,” he said. “Businesses need to position themselves to take advantage of opportunities in a more competitive environment, and we can’t just rely on ever increasing prices to cover ever increasing costs. “The key lesson is that the nature of the boom changes over time and and future growth will be delivered through volume and productivity growth. “Which is not to say we won’t have high prices again but the record prices we have seen in the past were heady days.” The Golding industry conference in Gladstone is an initiative of the Gladstone Engineering Alliance and will continue today and tomorrow with speakers from a range of industries involved in Gladstone’s future.