Australian resource and energy exports are expected to hit a record $296 billion in 2020-21, despite the global economic downturn.
The latest Resources and Energy Quarterly reveals the bumper result was due to a rebound in demand from China and an increase in commodity prices due to restricted supply caused by production slowdowns in other countries.
“Exports are forecast to earn a record $296 billion in 2020–21 and remain strong over the next five years, driven by ongoing demand for iron ore and growth in technology-related commodities such as lithium, nickel and copper,” Minister for Resources Keith Pitt said in a statement.
“The industry has remained safe and reliable suppliers to domestic and global markets throughout the pandemic,” he added, saying the rollout of the COVID-19 vaccine would also create more opportunity for growth in the Australian resource sector.
“Iron ore is benefitting from both high prices, as well as decades of investment, innovation and automation which have placed Australia at the forefront of the global iron ore market.”
Iron ore exports earnings are forecast to reach a high of $136 billion in 2020-21, up from the previously forecast $123 billion.
Further, exports of new technology-related commodities are expected to surge, with lithium exports expected to increase five-fold, nickel expected to double, and copper set to increase by a third.
Base metal exports are also expected to grow, with metallurgical coal used in steelmaking forecast to rise from 173 million tonnes in 2020-21 to over 191 million tonnes in 2025-26.
Thermal coal exports are expected to increase from 206 million tonnes to 231 million tonnes over the same period.
While Australian liquefied natural gas earnings are expected to drop from $48 billion in 2019-20 before recovering in 2025-26 to $45 billion.
The performance comes after concerns with Beijing’s eight-month-long economic coercion campaign targeting Australian exports such as coal, beef, wine, lobster, timber, lamb, and cotton, which would harm its economy.
However, recent figures suggest this is not the case.
In December, Australia recorded its fourth-highest monthly trade surplus on record, with Chinese demand for Australian iron ore and wheat remaining strong.