Brisbane Faces Evacuation, Flood Damages Mount in Australia

Chandrasekhar Atreya
11 Jan, 2011
New York City

Australian coal trade is severely disrupted and fears are rising that the damage to the economy may be larger than anticipated. Rising flood waters enter the city of Brisbane, the third largest city in Australia. Trade surplus in November narrowed to $1.925 billion.

[R]6:00 PM Sydney, Australia – Australian coal trade is severely disrupted and fears are rising that the impact on wider economy may be larger than anticipated. Rising flood waters enter the city of Brisbane, the third largest city. Trade surplus in November narrowed to $1.925 billion.[/R]

Stocks in Sydney fluctuated and finished marginally lower amid growing uncertainty about the impact of Queensland’s floods on the economy.

The ASX 200 lost 0.03% or 1.60 to close at 4,710.70 and the Australian dollar was slightly lower at 98.38 U.S cents at close in Sydney today.

Australia’s trade surplus narrowed to $1.925 billion in November, seasonally adjusted, from a downwardly revised surplus of $2.561 billion in October, official figures showed.

The figures released today by Australian Bureau of Statistics shows that while exports were flat in adjusted terms in November, imports were up 3%.

The floods have hit the tourism industry hard as last minute cancellations of hotel bookings and tourism trips to areas not affected by floods have started pouring in. The largest dam that has been protecting the dam is now full and the authorities were forced to release waters that are racing to the Brisbane.

The largest power station of Queensland government faces coal shortages and may have to be shut down soon. Floods have damaged crops used in the production of ethanol which could lead to fuel shortages.

Flood waters have wreaked havoc to coal trade of $25 billion and destroyed $6 billion of property and crop damage. The tourism is also facing rising cancellations and power cuts are expected to be widespread this week. Australia exports 260 million tons of coal and tourism industry generates $32 billion in revenues.

Rail operator QR National said today it closed the rail line servicing coal mines northwest of Brisbane due to severe flooding at Toowoomba, impacting two New Hope mines and one Peabody mine.

Brisbane, the third largest city is facing its worst flooding in fifty years and police confirmed 13 deaths in the last two weeks. The death toll is expected to rise and more than 100,000 people are without power and Brisbane Mayor Campbell Newman estimated at least 6,500 homes are likely to be flooded by Thursday.

Alcoa Inc, the U.S. aluminum manufacturing giant also listed in Australia, said on Monday its fourth quarter earnings surged marking the third quarterly profit in a row. The company reported losses in 2008 and 2009.

The company reported net income of $258 million for the December quarter compared with a net loss of $277 million in the quarter a year ago.

NRW Holdings Ltd said today it won a contract worth A$50 million to undertake preliminary works at the Middlemount coal project, north west of Rockhampton in Queensland.

The contract is to provide initial operational work for Middlemount, a joint venture between Macarthur Coal Ltd and Gloucester Coal Ltd for the year 2011.

Stock Movers

BHP Billiton gained 16 cents to A$44.61 while rival Rio Tinto lost 24 cents to A$84.12

Commonwealth Bank of Australia gained 25 cents to A$50.3 while National Australia Bank added 10 cents to A$23.89.

ANZ lost 13 cents to close at A$22.83 and Westpac Banking dropped 1 cent to A$22.06.

Wesfarmers rose 5 cents to A$31.25 after securing a 12% hike in metallurgical coal prices.