Rail, port and shipping charges represent 30 to 50 per cent of landed costs
for Australian coal mines selling to Asia. This proportion is higher for
sales to Europe, yet it is in Europe where Australian producers are aiming
for increased market share. The landed cost of coal to the international
customer is the key parameter which determines market competitiveness. The objective of this study is to examine Australian export coal
competitiveness in terms of transport distance. The approach used
examines world coking coal and steaming coal production and the
transport distances between major exporting regions and importing
countries. Reference is made to the importance of land transport costs
and a comparative approach for emphasising the relative magnitude of
this factor is developed. Models developed are examined in terms of
Australia's exports and a conclusion is reached that a reduction in rail
freight costs would be an effective measure for improving the
competitiveness of Australia's coal industry.