China puts 6% tariff on imported coal

This is on top of imposing quality rules on coal, China has put a 6% tariff on imported coal. With the Australian coal industry under huge pressure already and just breaking even, they now have to reduce costs even further. 

Expect a new round of retrenchments when this happens.

But investors don't seem to be prepared to wait and find out. 

They've sold off shares in mining companies. BHP Billiton and Rio Tinto dropped when trade began today. Whitehaven Coal's share price was down by around 7 per cent in late morning trade. 

And Tim Buckley from the Institute of Energy Economics and Financial Analysis says it's a new reality the industry just has to get used to. 

TIM BUCKLEY: You have to put it in the context that it is only one of many moves that China has announced in the last three, six, 12 months to diversify their electricity sector, and it puts Australia's coal export industry at serious risk. 

PAT MCGRATH: The latest measures are designed to protect Chinese coal producers, which have complained about the impact of international competition on their industry. 

But that's not the only reason China is shifting position on coal. 

Last month it introduced restrictions on high polluting coal in an effort to unclog the skies above its big cities. 

That move has contributed to further a slide in the coal prices, something that has been blamed for mine closures and waves of jobs cuts over the past two years. more