Earnings from Australian energy and minerals exports are forecast to increase 37% to $160 billion in 2009, $20 billion less than what was forecast last quarter, ABARE senior commodity analyst Alan Copeland told MINING DAILY.
The Australian Bureau of Agricultural and Resource Economics (ABARE), which released its Australian commodities forecast for 2009 today, said the economic slowdown in China will hurt Australian commodities in 2009.
“We had to revise the amount of minerals and energy exports down from our September forecasts because of the global financial crisis which has resulted in some sharply reduced world prices for mineral and energy commodities,” he said.
According to Copeland, the forecasted 37% increase in exports is supported by high contract prices for bulk commodities.
“A lot of the bulk commodities Australia exports are sold under fixed price contracts, which will not change until the end of March. At the moment, the market is so unstable and unpredictable that it is hard to forecast what will happen in April and beyond,” Copeland said.
“In line with global economic growth assumptions, demand for mineral and energy commodities is expected to pick up gradually in the second half of 2009.
The Australian Commodities report, which can be found on the ABARE website, said China was still the key to a quick turnaround in the energy and minerals commodity market, with the Chinese Government’s stimulus package expected to provide some support to the demand for resources in 2009.
“Sharp falls in prices for energy and mineral commodities from record highs in July have resulted as the global financial crisis has enveloped a number of OCECD countries, adversely affecting world economic growth prospects,” Copeland said.
“Economic activity in many OECD countries is expected to continue to contract for the next few quarters affecting demand from commodity — intensive industries.”