Black coal mining has been predicted by IBISWorld to be one of the Australian industries that will experience a decline in revenues this year as market conditions turn.
IBISWorld expects revenues in the black mining industry to fall by 14.2 per cent in 2018-19 due to a decline in prices for both coking and thermal coal.
Australian production of coking and thermal coal is, however, on track to increase in the 2019 financial year.
IBISWorld senior industry analyst Kim Do said coking coal prices were anticipated to decline following an increase in global supply and softening demand from China.
“Thermal coal prices are expected to decline as global economies continue to transition away from coal as part of increasing efforts to reduce greenhouse gas emissions,” Do said.
“In addition, Australian coal production capacity is anticipated to remain limited due to slowing investment in the industry.”
The diamond and gemstone industry is another mining sector forecast to see a decline in revenues.
IBISWorld predicts diamond and gemstone revenues to drop by 24.2 per cent as Rio Tinto winds down production at the Argyle diamond mine in Western Australia ahead of its planned closure in 2020-21.
Argyle is Australia’s last operating diamond mine and accounts for 80 per cent of industry revenue, according to IBISWorld.
“The Argyle mine’s closure represents the beginning of an extended downturn in the industry, as Australia currently does not have any new diamond resources to develop,” Do said.
“In the event of a new discovery, developing a new mine will take at least 10 years. Consequently, industry revenue is anticipated to remain well below previous highs for the foreseeable future.”
Argyle produced 10.9 million carats over the nine months to end-October 2018, a 1 per cent fall on the same period in 2017.
Liquefied natural gas (LNG), meanwhile, is expected to be one of Australia’s top performing industries, with IBISWorld forecasting revenues to grow by 39.3 per cent in 2018-19 to $43.5 billion.
The completion of the Ichthys and Prelude projects in northern Australia will give the country 10 operating LNG facilities.
“The major markets for Australian LNG are Japan, China, South Korea, and Singapore. Australia is expected to edge past Qatar as the world’s largest LNG exporter over the next two years, with Australia exporting more LNG than Qatar on a monthly basis for the first time in November 2018,” Do added.