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Floods costing Australia $3B in lost farming, coal

Australia Flood

Jan. 18: In this photo provided by the State Emergency Service emergency workers and volunteers form a train to carry sandbags to be placed to protect a house from rising flood waters near Euchca, Australia.AP

The river that submerged vast swaths of Australia's third-largest city last week surged again Friday and began flooding some Brisbane suburbs, as rivers in Australia's southeast soared to record heights.

The weekslong crisis has cost Australia at least $3 billion in lost farming and coal exports and has shown no sign of easing.

Homes, business and a race course in suburbs of Brisbane hit last hard week flooded again Friday, as city residents sandbagged their homes. An exceptionally high tide combined with rain engorged the main river running through the Queensland state capital Friday, and Mayor Campbell Newman urged people in low-lying areas to be prepared.

The Brisbane River is expected to remain high until Sunday. State Premier Anna Bligh warned that more flooding was possible, but she was hopeful the worst was over.

"We may see some localised flooding, which will be heart breaking if it happens," said Bligh. "We got a little bit of rain overnight, but not some of the rain that might have otherwise complicated this event, so fingers crossed."

In southeast Victoria state, hundreds of homes faced threats over the weekend as four rivers northwest of the state capital Melbourne were expected to reach their highest peaks in a century, said Lachlan Quick, spokesman for the State Emergency Service.

Eastern Australia has endured weeks of massive flooding that the government says could be the nation's most expensive natural disaster ever. It shut down much of Queensland's lucrative coal industry and has caused 30 deaths.

The Queensland floods will reduce coal exports by 16.5 million tons (15 million metric tons) by March, the Australian Bureau of Agricultural and Resource Economics and Sciences reported Friday.

The government's main forecaster on the farming and mining industries said the lost exports are worth up to 2.5 billion Australian dollars ($2.5 billion).

Australian farm produce — most of which is exported — including fruit, vegetables, cotton and sorghum will be cut by at least $500 million in the fiscal year ending June 30, the bureau said.

The global credit ratings agency Fitch Ratings estimated Friday that between 30,000 and 40,000 houses were damaged by the floods in Queensland alone.

Australia is the driest continent after Antarctica and was recently in the grip of the worst drought in more than a century. But 2010 was Australia's third wettest year on record, even though the country's drought-stricken southwest region endured its driest ever year.

With the drought retreating, the agricultural bureau had predicted in December last year that farm production would rise by AU$2 billion from AU$28 billion last fiscal year.

Also in December, the agency had predicted coal exports would increase to AU$48.6 billion this year from AU$36.4 billion last year due to higher prices and greater volumes driven by burgeoning Asian demand. The floods have put that growth in doubt.

The government has yet to estimate the cost of the damage, which will reach billions of dollars, but Prime Minister Julia Gillard said she was considering introducing a flood tax to pay for reconstruction.

Some estimates already were at $5 billion before the Brisbane floods last week.

In Victoria, 72 towns have been affected by flooding already and more than 3,500 people have evacuated their homes.