Commodity prices soar as Queensland becomes “inland sea” (area size of France + Germany submerged)

[Hannah Bell]

The submergence of an area of Queensland, the size of France and Germany combined, has already resulted in the tragic loss of dozens of lives and thousands of homes and livelihoods. But the reverberations of the disaster will be felt far more broadly than just in Queensland itself.

Even before the flash floods of the last few days wrecked havoc in the regional centre of Toowoomba and outlying towns, the economic damage of the floods was conservatively estimated at $6 billion. The clean-up is expected to cost at least $5 billion, with at least $1 billion needed for restoring roads and the impact on Australian gross domestic product (GDP) calculated at around a $2.5 billion loss.

These figures were revised sharply upwards by Reserve Bank of Australia board member Professor Warwick McKibbin who told the Sydney Morning Herald today: “If you look at the infrastructure damage and all the networks that have been broken, a hit to the economy of 1 percent is not out of the question.” This translates into a $13 billion impact on the Australian economy.

“Queensland is not a little island sitting out there somewhere north of Newcastle,” he added. “There will be permanent loss of national income.”

Economic analysts are predicting a $2.5 billion drop in coal production alone, with further major losses in wheat, cotton, sugar cane and other agricultural production, construction, transport, and the tourist industry. Fruit and vegetable prices—already up about 46 percent in the last five years—may climb as much as 30 percent in Australia over the next six months. Higher prices for ethanol, a cheap fuel additive, will flow onto domestic petrol rises.

The Queensland floods, in fact, provide a powerful demonstration of how Australia, despite its relative geographic isolation, is completely integrated into the global economy. Already estimates are being made of the impact of lower Australian production in coal, wheat and other raw materials on international markets.

http://www.wsws.org/articles/2011/jan2011/quec-j12.shtml

[midnight]

1. That's one heck of a economic hit.....

I hope that with this areas future predictions of flood damage they can, at least, protect the lives in this area.

[itsrobert]

2. Why am I not seeing coverage on the News Networks?

American networks?

[Mira]

3. Because we have one issue newscasting. n/t

[Hannah Bell]

4. i was wondering myself. it's been flooding a while.

[RainDog]

5. this is a major disaster

sometimes the world is too much to take in.

[Lorien]

6. The ruling elite love climate change

they see death and disaster as just another means of lining their own pockets.