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PERTH (miningweekly.com) – The Queensland Resources Council (QRC) on Monday welcomed a positive outlook from advisory firm Deloitte Access Economics, which on Monday predicted that Queensland’s diverse resource sector would ensure that the state remained a front-runner for growth.
Deloitte Access Economic’s latest Business Outlook stated that while Queensland was dealing with “painful” falls in coal prices, the state’s liquefied natural gas (LNG) projects, currently under construction, would delay the impact of a construction cliff and would generate large export dividends.
QRC CEO Michael Roche said on Monday that the outlook remained positive for the sector beyond the current downturn in coal prices.
“The report confirms that Queensland’s resources diversity is a key to its continuing role as a pillar of the economy,” he said.
“The export dividend from earlier investment in minerals and energy is paying off with record exports of more than 200-million tonnes of coal in addition to a surge in export gas sales from 2016 onwards.
“This positive forecast could not have happened without strong bipartisan political support for the gas industry in Queensland,” Roche added.
Deloitte expected Queensland to top the leader board among the states for its rising share of the national economy by 2016 for the first time in a decade.
“In 2012/13, Queensland’s resources sector generated directly and indirectly one in every four dollars of the state’s economy and accounted for one in every five jobs,” Roche said.
“Our latest survey of sector spending will be released next month and is expected to confirm Deloitte’s conclusions and our oft-stated view that the sector’s increasing diversity is the best insurance against commodity price cycles.”
Meanwhile, Deloitte stated that Western Australia was facing big challenges from the looming construction cliff.
“Although the baton pass from construction to exports has been smooth so far, the state’s economy is slowing and a further recent slump in the iron-ore price highlights the ongoing risks,” Deloitte said on Monday.
As a whole, Australia’s transition through the mining boom was going well, Deloitte noted, which added that while mining-related construction work may be fading, resource exports were climbing fast while low interest rates have resulted in better news for the retailers and a welcome recovery in housing construction.
However, Deloitte noted that the shift from construction to production in the resources sector would negatively affect the job market, as would the continued strong Australian dollar.