The mining industry is already pouring out lies in response to the government’s industrial relations changes, just like it did in response to Labor’s mining tax over a decade ago. Except, this time the lies are even more absurd.
In fact it’s almost a case of “come back, Mitch Hooke, all is forgiven”, if the quality of the latest scare campaign from the Minerals Council is anything to go by.
Dutifully written up by News Corp stenographers, the mining industry’s argument against industrial relations reform centres on the claim “that 22,000 construction jobs and more than 11,000 ongoing jobs could be at risk” from “critical minerals, lithium, copper and other resources projects”.
“More lithium for batteries, more copper for solar panels, and more cobalt for electric vehicles. Not more uncertainty and risk that will simply chase away investment from our shores, at such a crucial hour,” says Minerals Council head Tania Constable — or, as The Australian’s Geoff Chambers describes her, “Mr Constable”.
How the mighty have fallen — in the days of Mitch Hooke, the Minerals Council’s scare campaigns would have featured hundreds of thousands of jobs and hundreds of billions in investment risk, sending foreign capital to flight. If 33,000 jobs is the best the Minerals Council can do, are they even trying?
Notice that most of those jobs are in construction — which is currently under massive pressure with price inflation and workforce shortages. Frankly, we could do with 22,000 more construction workers available to work on hard-pressed major infrastructure projects, or even in residential construction. As for 11,000 jobs, that’s around 0.4% of the mining workforce.
You can see why the Minerals Council is terrified that industrial relations reform might spark a massive surge in wages in the sector, though — in last week’s wage price index data for the September quarter, wages in the mining sector were already exploding, with an annual growth figure of… um, 2.7%. Constable must be worried wages growth will hit a shocking 3%.
Now let’s get to the serious bit — where the Minerals Council is blatantly lying about the risk to jobs and investment.
Australia is the world’s biggest lithium exporter, and since last year, the price of lithium has increased nearly sixfold. Lithium miner Pilbara Minerals went from never making a profit to making more than half a billion dollars; another miner, Allkem, saw revenue grow 800% (not a typo) and make nearly half a billion dollars. The industry predicts the lithium price will remain around nearly US$50,000 a tonne into next year.
In the September quarter, sales from Talison Lithium’s Greenbushes mine in Western Australia — which has been producing lithium since the mid-1980s — totalled 338,000 tonnes of spodumene (the source for lithium), which led to a quarterly sales revenue of $1.84 billion from the mine, a 112% jump from the June quarter. There was no sales revenue for the same quarter of 2021-22. A crude annualising of that quarterly figure gives a revenue figure for the year to June 2023 of more than $7 billion from one mine for Talison.
Pilbara Minerals had an equally productive September quarter — just more than US$1 billion, which means it is heading for revenue of more than $4 billion for the year to next June.
That means between Greenbushes and Pilbara Minerals, lithium could be generating gross sales revenues approaching $12 billion by next June, which in turn could be most of the export revenue forecast for the financial year or around $14 billion.
The resources department forecasts lithium to stay at nearly US$50,000 a tonne into 2023 and will still be nearly double 2021 prices in 2024. And it’s not just lithium. “Metals central to the global energy transition (copper, nickel, lithium) are set to earn $33 billion in 2022–23, double what they earned in 2020–21,” government forecasts say.
“The transition to low-emission technologies will add significantly to the demand for non-ferrous exports over the outlook period. Notably, lithium exports are now forecast to rise by over 180% to $13.8 billion in 2022–23 but then drop to $12.9 billion in 2023–24, as prices ease. Lithium exports in 2021–22 were almost $5 billion, up from $1.1 billion in 2020–21.”
And despite being namechecked in the News Corp stenography, BHP — evidently untroubled by the industrial relations bill — wants to spend A$9.6 billion to buy smaller copper, gold and nickel miner OZ Minerals. That’s a big investment for a company notionally ready to flee the industry, and which already has its own WA nickel business.
The Minerals Council is seriously claiming that mining companies are going to turn their backs on the massive historic opportunity of renewables technology, and the billions that will flow from it, because they might have to pay slightly higher wages. You’d have to be a News Corp journalist to believe that.
