Australia Announces $5.6 Billion Flood Relief Package

Chandrasekhar Atreya
27 Jan, 2011
New York City

Stocks in Sydney traded flat with mining stocks firming during the day. P.M. Julia Gillard announces flood relief package of A$5.6 billion including a progressive tax levy. Crane Group enters into a two-day trading halt pending finalization of a revised takeover offer from New Zealand-based Fletche

[R]6:00 PM Sydney, Australia – Stocks in Sydney traded flat with mining stocks firming during the day. Prime Minister Gillard announces a flood relief package of A$5.6 billion including a progressive tax levy. Crane Group enters into a two-day trading halt pending finalization of a revised takeover offer from New Zealand-based Fletcher Building.[/R]

Australian stocks drifted in a narrow range to close flat in a muted trade, with mining stocks firming today.

The ASX 200 Index fell 0.04% or 1.70 to close at 4,806.10.

The Australian dollar ended at 99.51 U.S cents in Sydney today.

Prime Minister Julia Gillard announced today a flood relief package worth A$5.6 billion including a progressive tax levy of 1% on tax payers earning more than A$100,000 a year and a 0.5% for those earning more than A$50,000 a year.

The New South Wales government said today that as per their estimate the farmers of the state have lost at least A$850 million due to harvest losses from floods in the state. Almost half of the 2.8 million hectare wheat crop has been downgraded to feed quality due to weather damage caused by floods said Primary Industries Minister of the state Steve Whan today.

The Queensland Resources Council estimates that cost of lost coal output following the recent floods in the state could top A$9.5 billion in a worst case scenario.

Rio Tinto, the miner, said today that it is resuming normal operations at its Port of Dampier iron ore terminal in northwest Australia after a passing cyclone Bianca briefly forced it to restrict operations.

Apache Corp said today it halted production at its Stag oil field off the northwest coast because of the cyclone sweeping along the coast. Woodside Petroleum also stopped oil production at its Enfield operations due to this cyclone.

Crane Group, the plumbing supplier in Australia, said that it has gone into a trading halt for two days following New Zealand-based Fletcher Buildings’ bid for the company.

Western Australia is set to continue its status as a boom state but will be constrained by a severe shortage of skilled workers, a report by Access Economics shows.

In its latest Business Outlook survey, the agency says that other states will continue to struggle as they emerge from the economic crisis. It also said that projects worth A$250 billion in resource and other sectors were creating an unprecedented demand for skilled workers with the number of overseas workers dropping sharply.

Iron ore shipped by Murchison Metals dropped by more than a third in the December quarter from the year ago period while productions costs soared, the company said.

The second quarter activity report of the company showed that shipments of iron ore fell 35.6% to 368,041 tons in the December quarter of 2010 as compared to 499,328 tons in the same quarter in 2009.

Stock Movers

BHP Billiton gaining 12 cents to A$45.17 and rival Rio Tinto firming 53 cents up to A$86.04.

The higher spot gold price helped Newcrest Mining to close up 56 cents at A$38.18.

Shares in Downer EDI plunged 20.1% to A$3.61 after the engineering firm said it would make another A$250 million in provisions relating to the Waratah train project in New South Wales.

Banking sector had mixed results. Commonwealth Bank gained 5 cents to A$52.65 and Westpac Banking Corp added 10 cents to A$22.92, while National Australia Bank lost 18 cents to A$24.60 and ANZ weakened 3 cents to close at A$23.58.

Macarthur Coal was 28 cents higher after it said metallurgical coal prices had risen due to supply disruptions from Queensland.