Manufacturing News

Processed commodity prices return to normal post Ukraine war effect

Manufacturing News

Australia’s resources and energy export earnings are forecast to normalise over the next two years as commodity prices return to long-term levels following a price spike brought about by Russia’s invasion of Ukraine.

The June 2024 Resources and Energy Quarterly (REQ) from the Department of Industry, Science and Resources estimates export earnings of $417 billion in the year to June 30, 2024, down from record $466 billion in 2022–23.

Export earnings are forecast to ease further to $380 billion in 2024–25 and $356 billion in 2025–26.

Commodity prices are now returning to normal levels as global supply steadily improves after Russia invaded Ukraine.

The Minister for Resources and Northern Australia Madeleine King (pictured) said the forecasts showed gains in export volumes.

King said: “This data shows the resources industry remains the bedrock of our economy and our economic wellbeing.”

While the figures include largely unprocessed minerals such as iron ore and thermal coal – among the largest export categories – they also include so called substantially transformed exports (STMs) in the form of refined metals.

King said: “Importantly, we are seeing strong demand for the critical minerals and strategic materials needed for low-emissions technologies, including lithium, nickel, copper and aluminium.

“The forecasts underscore the need to support growth in our emerging critical minerals sector, which the…government will deliver through a Production Tax Credit for critical minerals.”

The June REQ forecasts a modest improvement in nickel prices, after the world market was hit by a significant increase in supply from Indonesia.

Australia’s LNG export revenues are forecast to decline from $69 billion in 2023–24 to $59 billion by 2025–26.

Gold exports are expected to earn a record $33 billion in 2023–24, easing to around $31 billion in 2025–26.

Australia’s copper exports are forecast to rise from $12 billion in 2023–24 to $17 billion in 2025–26 due to higher prices as a result of an improved manufacturing outlook in China and a ban on Russian metals on the London Metals Exchange and COMEX commodity exchange.

Picture: Madeline King

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