Australia’s resources and energy exports are poised for continued growth, even in the face of softening commodity prices, according to the December 2023 edition of the Resources and Energy Quarterly (REQ) from the Department of Industry, Science, and Resources.
The forecast, indicating export values easing to $408 billion in 2023 – 24 and $348 billion by 2024 – 25, is primarily attributed to projected declines in commodity prices, the government revealed in a media release.
Despite this adjustment, strong investment in major resource and energy projects is anticipated to drive sustained growth in the sector over the next few years.
The Resources and Energy Major Projects report (REMP) from the same department underscored the robust outlook for resources investment, particularly in critical minerals crucial for low-emission technologies aiding global decarbonisation.
Committed critical minerals projects have experienced a notable 75 per cent increase in value, rising from $6.7 billion in 2022 to $11.8 billion in 2023.
Minister for Resources and Northern Australia Madeleine King highlighted the sector’s significance, stating, “Australia’s resources sector remains the engine room of the nation’s economy.”
She emphasised that resources play a critical role not only in national prosperity but also in the commitment to reducing carbon emissions and achieving net-zero goals.
Minister King affirmed, “The road to net zero runs through Australia’s resources sector.”
The REMP report noted an increase in the number of resources and energy projects under development, reaching 421 by the end of October, up from 393 projects the previous year.
This includes 86 committed projects valued at $77 billion and 46 projects worth $30 billion in the advanced feasibility stage.
The REQ highlights the resilience of iron ore prices, exceeding previous forecasts due to positive sentiment from China’s economic stimulus.
Iron ore export earnings are projected to increase to $131 billion in 2023 – 24 before declining to $102 billion in 2024 – 25.
However, lower world prices for lithium are expected to result in a decrease in Australian lithium exports to $14 billion this year, stabilising at around $15 billion in 2024 – 25.
The REQ also indicated that despite an increase in volume, lower prices will lead to a decline in earnings from metallurgical coal used for steelmaking, reaching $52 billion in 2023 – 24 and $41 billion in 2024 – 25.
Thermal coal earnings are forecasted at $36 billion in 2023 – 24 and $29 billion in 2024 – 25.
The December 2023 Resources and Energy Quarterly and Resources and Energy Major Projects reports are accessible on the Department of Industry, Science, and Resources website.
