Australia: Prosperity out of the Pit

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Improving the Australian economy was hardly a major aim in the life of John L. Lewis, but that is just what he did. In 1954, with their antiquated industry slumping badly, Australian coalmine owners and union leaders journeyed to the U.S. in search of a solution. Naturally, they dropped in on the longtime leader of the United Mine Workers. He urged that they mechanize their mines, as the U.S. was doing with U.M.W. support. "Do you believe in slavery?" asked Lewis. "No? Well, then, it's better to have 10,000 contented workers than 20,000 men working like pick-and-shovel slaves. That's what mechanization means." Recalls Sir Edward E. Warren, 68, Australia's biggest mine operator: "That was the great breakthrough. We came back home, and mechanization went straight in."

Before that breakthrough, in spite of huge and largely untapped coalfields, Australia imported coal from as far away as South Africa, still suffered power blackouts when supplies ran low. Today, 94% of Australia's growing power needs are generated by coal, there is ample coke for the continent's expanding steel industry, and a quarter of last year's record 50-million-ton coal production was available for export.

Coal's resurgence, which played a big part in the sturdy growth of the entire Australian economy, is due to complete modernization of the industry. Last week Sir Edward Warren announced that his Coal & Allied Industries Ltd. would open a new mine in Cessnock, 80 miles north of Sydney; it will be worked with automatic equipment, including a U.S.-manufactured continuous miner, which is operated by three men, crunches coal seams with spinning metal teeth and can chew out ten tons a minute. Helped by government tax allowances, mine owners have so far spent $236 million on such new equipment; 98% of Australia's rich black coal is now efficiently mined by machine instead of pick and shovel. Mechanical equipment has trimmed the work force from 24,000 miners to 15,000; meanwhile, individual productivity and wages have both trebled.

The rising export trade made possible by new efficiencies has also created a need for big new coal harbors all along the Queensland and New South Wales coasts. At Port Kembla, for example, an $11 million facility loads ships at a 2,000-ton-an-hour rate, has cut loading time from four days to one. Cheaper coal makes Australia a competitive exporter, principally to Japan, which last year took 7,000,000 tons for steelmaking. U.S. coal still accounts for 48% of Japanese imports, but the Australian share has climbed to 30% and undersells U.S. coal by $4.74 a ton.