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ECON 3008 - Demand and Supply || Paper on Coal in Australia

   

Added on  2020-02-24

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Running Head: Coal in AustraliaDemand and Supply of Coal in AustraliaBy (Name)(Tutor)(University)(Date)
ECON 3008 - Demand and Supply || Paper on Coal in Australia_1

Coal in Australia2Demand and Supply of Coal in AustraliaIntroductionCoal is one of the resources that started being used as a source of energy many years ago (Pearse, Mcknight and Burton, 2013). It was in fact the major source of energy before the introduction of the current sources that the world depend on. It is a major resource used in the steel production industry and a current source of electricity and expected to continue being used in the future (Minerals.org.au, 2017). China is one of the largest steel producer and imports nearly half of its coal form Australia. Generally, despite the current disruption caused by Cyclone Debbie, coal production has been on the rise. This make coal an important commodity of trade for Australia which earns a large proportion of foreign income. The increased demand for coal has stimulated a rise in the production level (Potter, 2015). Thus this paper will make the policy makers understand the contribution of coal to the Australian economic performance and thus implement policies that would facilitate improvement in production and transportation. The mining company will also understand their importance in the international markets (especially in China) and thus strive to maintain a sustained supply throughout. The importing nations shall also understand the reason for the increased shortage and may decide to look for a temporary supply before the Australian supply recovers. AnalysisThe use and supply of energy in Australia is on a continuous change according to Ball (2016); the economy is aiming to be a leading energy supplier. In the article “With Australia's supply disrupted by Cyclone Debbie, coal buyers race elsewhere” written by Serapio (2017), the coking coal supply has been exposed to risk by the Cyclone Debbie. Japan and China are the biggest buyers of coal and thus are looking for fresh supply as the deficiency in supply persists. The impacts of this deficiency on the Australian economy is loss of businesses. The disruption ofthe Australian coal supply has benefited several economies such as Mozambique, United States, Russia and Mongolia because its cargoes are quickly replaced by the exportation of steel from Japan and China to Turkey and India. A shipping source who keeps track of the global coal cargoes pointed out that impact caused on the China Steel industry from the cyclone Debbie was also caused to Indian, Japan andTurkey steel industry. This is because at the previous higher supply of coal, the stocks for these
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