I think this idea of the 'canary' as outlined in the article applies to miners who also engage in energy intensive minerals processing. The article states that it's the alumina production that is threatened and not the basic ore extraction.

Surely the majority of Aust mining is just that, basic ore extraction only. With the capital and energy intensive metals manufacture conducted overseas.

So how does it then follow that all of Aust mining faces the same risks as Pacific Aluminium?
Isn't it really more the currency risk? Though even at current dollar levels Rio is not about to stop digging...

Our Aluminium Industries get enormous subsidies by our State Govts.They use 15% of all the power generated here and are subsidised to the tune of over $70,000 per worker.Stop the subsidies.They are not worth it.

I can't help noticing that the author has made no attempt to provide any form of cost-benefit analysis against the proposed (or already approved) $900 million public expenditure (subsidy) to keep this smelter operating - although the author indicates such a study as necessary, and I would have expected government, and Treasury, to have undertaken such a study before committing to any subsidy by way of infrastructure support or otherwise.

Surely details of such an analysis should be available from our government - or are they in the habit of handing out subsidies on mere whim? Although the aluminium price is subject to fluctuation, as well as the $A, I would have thought it not too difficult to compile at least a ball-park assessment:
Revenues from ore production and transportation only; as against -
Revenues from overall aluminium production and shipping, plus wage, salary and welfare-support differential - plus, if relevant, any differential in returns from gas supply to this facility, as against its alternative supply to other internal or overseas buyers.

Not as easy as 'falling off a log' perhaps, but not 'astro-physics' either. Impacts on human capital and potentials a little more difficult, but certainly an essential consideration.

On the general question, if our economy contracts (through mining decline or otherwise), and other world economies recover from current woes (as I would reasonably expect, eventually), our $A should become less of an interest as a trading and speculative currency, and thus to fall substantially from its current extraordinary highs. Accordingly, I suspect the 'canary' is in fact a 'lame duck'.

We certainly do need to concern ourselves with planning for our post-mining-boom economic and social well-being - particularly by taking utmost advantage of the boom, while it lasts, to develop our industrial, manufacturing and other capabilities appropriate to our human and capital resources, such as will place us in a competitive position on international markets.

No 'doomsday' at this point, and our canary still in good voice, but no future but what we make. Shangri-La awaits those with clear vision and boundless, responsible, determination.

Saltpetre
quite so - a cost benefit analysis would be nice. The high Aus dollar is a problem at this stage of the business cycle but perhaps we'll stuff things up with wild spending initiatives that will make foreign investors lose confidence and the dollar will fall.. just a thought.

Leslie
technical note - all mineral rights in Aus are owned by the state and federal governments. they don't come with the freehold. Hence the argument over the mining profits tax a few years back.. it wasn't a tax as such but a mining royalties impost which the Rudd government of teh time totally stuffed up.. the states have their own tax/royalties impost in place and the Federal govenrment is basdically coming in on top of what they charge.. there is also a petroleum resources rent tax..

For decades one of our "natural advantages" in industry was our cheap power. Our cheap coal power generation benefited all our manufacturing industries. Alumina production was one of them that prospered.

Then the stupidity of alternate energy, & the subsidies to support it, & suddenly an industry which is a natural for Oz is threatened. Weren't we always told we must add value, & not just export raw products. Fat chance with this bunch of fools in power.

Any more years of this stupidity, & the only employer left will be government, with no tax payers left to generate their pay.

God help us.