The Herald reported that a fall in thermal coal prices has added downward pressure to the Upper Hunter economy. While the region in recent years has outshone other parts of the Hunter Region economy, the Upper Hunter is now being assisted by Lower Hunter housing and labour growth.

Mr Simon Deeming Hunter Valley Research Foundation director of Research said that the dramatic falls in prices for thermal coal have added to the existing pressure on costs in the industry.

Mr Deeming, who presented the latest Upper Hunter economic update in Muswellbrook said that Upper Hunter labour and housing markets are constrained by the price falls but the situation would be more pronounced if not for large housing and labour activity in the Lower Hunter.

He said that the immediate context remains one of constraint in the local labor and housing markets, a factor that would be substantially exacerbated if not for the proximity of large housing and labor markets in the Lower Hunter. Consumer confidence has also fallen further while the cost of living continues to rise.

Mr Deeming’s report said that lower commodity prices without declines in the Australian dollar will delay the next wave of capital investment in the Upper Hunter. Incomes in the Upper Hunter were expanding rapidly. The numbers of people experiencing rental stress people who pay more than 30% of their income in rent was increasing and the situation would get worse. Housing and labour shortages and cost of services would also increase. Housing has not responded to growth at all.

Source - The Herald

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