PERTH (miningweekly.com) – Australia’s resource and energy exports are forecast to reach a record A$464-billion in 2022/23, following a surge in energy prices in 2022. However, export earnings are forecast to ease to A$395-billion in 2023/24, and A$346-billion in 2024/25 as prices continue to normalise.

In the latest Resources and Energy Quarterly (REQ) report, the Office of the Chief Economist noted that Australia’s mining sector made up more than two-thirds of total merchandise export, and contributed around 13.7% to the gross domestic product.

Minister for Resources and Northern Australia Madeleine King said Australia’s resources and energy exports continue to be strikingly resilient and prove the indispensable role Australia plays as a stable and reliable supplier despite the global turmoil caused by Russia’s illegal and immoral invasion of Ukraine.

The latest surge in export earnings was driven by higher energy prices, with the REQ estimating that liquefied natural gas (LNG) earnings would reach A$91-billion in 2022/23, as high LNG prices more than offset the impact of slightly weaker export volumes.

After reaching 83-million tonnes in 2021/22, Australia’s LNG export volumes are forecast to stabilise at 80-million tonnes, as output from Pluto LNG train two offsets falling production from the Northwest Shelf.

Although international coal prices have eased, the REQ forecasts they are likely to remain higher than they were prior to the Russian invasion of Ukraine for some years to come. 

Despite weather events and Covid-19 disruptions affecting supply chains, Australia’s combined coal export earnings are forecast to be worth A$128-billion in 2022/23 compared with A$114-billion in 2021/22.

Higher metallurgical coal production is expected to lift Australia’s exports, from 163-million tonnes in 2021/22 to 172-million tonnes by 2027/28, and Australia’s metallurgical coal export earnings are forecast to track with price movements, peaking at A$72-billion in 2021/22 before falling back to under A$30-billion by 2027/28.

Meanwhile, mine closures and openings are expected to remain largely in balance over the outlook period, with Australian thermal coal exports sitting at around 195-million tonnes out to 2027/28. The REQ noted that falling prices are expected to result in export values easing from a record A$65-billion forecast for 2022/23, to a more typical level of around A$19-billion by 2027/28.

The report found iron-ore prices have rebounded strongly in 2023, reflecting a recovery in Chinese steel production, with export earnings forecast to be worth about A$121-billion in 2022/23 compared with A$132-billion in 2021/22.

Australian iron-ore export volumes increased by 1.5% year-on-year in 2022 to 884-million tonnes. With further greenfield supply expected to come online from established and emerging producers in the next few years, export volumes are forecast to increase by 1.9% annually over the outlook period to 2028.

King, meanwhile, said the forecast value of lithium exports had tripled since last year and was set to reach A$19-billion in 2022/23.

“Base metals and critical minerals such as lithium are crucial components of clean-energy technologies such as batteries, solar panels and wind turbines, which will help the world lower emissions and meet net-zero commitments,” King said.

“The latest REQ underlines the importance of our critical minerals sector and Australia’s ambition to become a clean-energy superpower.

“The REQ forecasts that exports of lithium and base metals (and their raw material inputs) will equal the export value of combined (thermal and metallurgical) coal exports by 2027/28.”

Australia’s lithium production is forecast to grow from 333 000 t of lithium carbonate equivalent (LCE) in 2021/22 to 431 000 t in 2022/23. By 2027/28, LCE tonnage will be double 2021/22 levels, at 661 000 t.

In 2022/23, Australia’s export earnings are forecast to more than triple, from A$5.3-billion in 2021/22 to A$18.6-billion. They are then expected to decline to A$11.8-billion in 2024/25 in real terms, before picking up later in the decade to reach A$19-billion by 2027/28.

Meanwhile, Australia’s copper exports are projected to grow from 868 000 t in 2022/23 to around 970 000 t in 2027/28, supported by additional production from new mines and mine expansions.

The REQ noted that as output grows and prices strengthen, Australia’s copper export earnings are projected to grow, from A$13-billion in 2022/23 to A$15-billion in 2027/28.

Furthermore, Australian gold mine production rose 2.4% to 315 t in 2022, and production is forecast to increase to a peak of 336 t in 2024/25, as new projects and expansions of existing projects come online.

Gold earnings are forecast to decline in real terms, from A$25-billion in 2021/22 to around A$20-billion in 2027/28, as rising export volumes are offset by the impact of lower gold prices in real terms.