These mining jurisdictions demonstrate a high level of investment attractiveness mainly due to their mineral-rich geology, solid infrastructure, stellar economic environment and government support for the resources industry at both the federal and state level.
Australia exports a wide range of important mineral resources, including precious metal gold, base metals such as copper, iron ore, aluminum and nickel, and energy resources oil, natural gas and coal. In recent years, lithium has also become a major mineral export for Australia.
The Department of Industry, Science and Resources’ data from 2022/2023 shows that iron ore accounted for AU$129.1 billion of export value in that period, and is forecasted to bring in AU$136.7 billion for 2023/2024. Weaker demand out of China, and globally, is likely to dampen demand for iron ore going forward, which led the department to project iron ore export value of AU$82.8 billion for the 2028/2029 financial period.
During the 2023/2024 period, export values for both metallurgical and thermal coal are expected to drop to AU$55.7 billion and AU$36.3 billion, respectively, and fall even more sharply by 2028/2029 to AU$35.2 billion and AU$21.2 billion.
Liquified natural gas (LNG) is Australia’s third most valuable resource export, earning more than AU$95.9 billion for the economy in the 2022/2023 financial period. The Department of Industry, Science and Resources expects this figure to decline to AU$71.5 billion for 2023/2024.
The island continent is home to 14 different basins that yield natural gas. The country has significant natural gas reserves, with much of it locked up in coal seams that require unconventional drilling. Most of Australia’s natural gas production occurs offshore in the northwest, which has seen an increase in large development projects over the past few years.
Moving forward, several factors are expected to place downward pressure on Australia’s LNG export values, including less production from maturing wells alongside a drop in investment; declining use of natural gas as an energy source in favour of renewables; lower natural gas prices; and the rising prominence of US LNG in the global export market. All in, the department projects the value of Australia’s LNG exports will fall to AU$44.8 billion in the 2028/2029 financial period.
Gold accounted for AU$25.4 billion in export value in the 2022/2023 financial year in Australia, earning its place as the fourth most valuable mineral export. The Department of Industry, Science and Resources expects this figure to rise to AU$27.9 billion for 2023/2024, before falling to a projected AU$19.7 billion by 2028/2029.
Looking forward, for the 2023/2024 period, the Department of Industry, Science and Resources is forecasting AU$11.3 billion in export value for lithium, and projecting that figure to come in at AU$9.1 billion in 2028/2029.
This is an updated version of an article first published by the Investing News Network in 2019.
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
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