Decline in mineral export earnings: ABARE

Its December quarter 2009 report of “Australian Mineral Statistics” noted lower contract prices for the 12 months starting April 2009 for iron ore, metallurgical coal and thermal coal which fell by 33 per cent, 57 per cent and 44 per cent, respectively.
There was also downward pressure placed on export earnings by lower export volumes and prices of most base metals, particularly in the first half of the year.
The main contributors to lower mineral export earnings in 2009 were: metallurgical coal, which decreased by $7.3 billion (23 per cent) to $24.7 billion; crude oil and other refinery feedstock, down $3.5 billion (31 per cent) to $7.7 billion; alumina, down $1.6 billion (35 per cent) to $4.7 billion; liquefied natural gas (LNG), down $1.6 billion (17 per cent) to $7.7 billion; aluminium, down $1.6 billion (30 per cent) to $3.6 billion; nickel, down $1.2 billion (28 per cent) to $3 billion; and manganese ores and concentrates, down $1 billion (51 per cent) to $1 billion.
Gold recorded the largest increase in export earnings in 2009, increasing by $875 million (7 per cent) to $14.2 billion. This was largely because of a surge in the export of refined gold derived from scrap sourced mainly from Asian markets, as a result of strong global investment demand for gold.
Mineral and energy resource production in 2009 was generally lower than in 2008, with 60 per cent of commodities recording lower production in 2009. This was because of lower prices for many commodities, mine closures and disruptions over the year.
Commodities which recorded significant declines in production were: iron and steel (32 per cent), diamonds (31 per cent), other refined petroleum products (22 per cent), mined silver (15 per cent), mined zinc (15 per cent), refined copper (11 per cent), and mined nickel (17 per cent).
Commodities which recorded production increases in 2009 were: tin, (216 per cent), refined nickel class 1 (38 per cent), iron ore (15 per cent), natural gas (11 per cent) and coal (4 per cent).
Higher tin production during the year was a result of increased production at the Metals X’s Renison tin mine in Tasmania, while higher iron ore and coal production was supported by strong import demand from China for both commodities.
In terms of the December quarter 2009, ABARE reported that the index of export prices of energy and mineral resources, in Australian dollar terms, declined by 5 per cent compared with the September quarter, as a result of a 9 per cent appreciation of the Australian dollar.
Export earnings for the December quarter increased by 1 per cent compared with a quarter earlier. This reflected increases in export earnings for gold, aluminium, crude oil and LNG being largely offset by lower export earnings for coal.
Minerals and energy production in aggregate increased in the December quarter. Higher production of bauxite, alumina, gold, iron ore and nickel offset lower output of coal, crude oil, zinc and uranium.
Diamond production increased significantly during the December quarter 2009 because of increased production from Rio Tinto’s Argyle mine. Iron and steel production rose, mainly because of higher production from Bluescope’s Port Kembla and Onesteel’s Whyalla operations. For nickel, increased production, both refined and intermediate, was a result of higher output from BHP Billiton’s Nickel West operations.