PERTH (miningweekly.com) – The outlook for Australia’s resource and energy exports has improved over the past three months, as global economic activity rebounds from the Covid-19 pandemic, with resources and energy exports to remain robust after earning a record A$291-billion in 2019/20, federal Resources Minister Keith Pitt said in December.

The December Resources and Energy Quarterly forecasted that resources and energy exports would earn A$279-billion for Australia in 2020/21, and A$264-billion in 2021/22, up by A$22-billion and A$12-billion respectively from the September quarter forecasts, with improved global economic activity set to drive even stronger demand.

Pitt said the figures, compiled by the Department of Industry, Science, Energy and Resources, underlined the resilience of Australia’s resources sector, with record forecasts for iron-ore and gold offsetting lower returns for coal and liquefied natural gas (LNG).

“The diversity of Australian commodities and the investment in technology and innovation over the past 20 years helped producers and exporters overcome the challenging conditions of the past year and made sure Australia remained a reliable source of resources and energy,” Pitt said.

“Australia now stands ready to help supply our export partners as they rebound from the global economic downturn caused by Covid-19, with the development and rollout of effective vaccines contributing to global optimism.

"Australia’s success in reaching new markets is an important part of our future success. The Coalition government remains focused on pursuing new investment in the sector and new export markets, which will boost incomes and jobs in Australia’s towns and regions, and contribute to the prosperity of all Australians.”

The December Resources and Energy Quarterly shows iron-ore export earnings are set to reach an all-time high of A$123-billion in 2020/21, as strong demand from China and supply problems in Brazil keep prices at high levels.

Australian iron-ore export volumes are expected to grow from 858-million tonnes in 2019/20 to 906-million tonnes by 2021/22 as mines open or expand in Western Australia, with stronger iron-ore prices also pushing export values to a peak in 2020/21.

Australia’s gold exports are on track to set a new record of about A$30-billion in 2020/21, making gold Australia’s third largest commodity export behind iron-ore and LNG.

Australia’s gold mine production is forecast to reach a record 384 t in 2021/22, as record prices encourage an expansion in production.

Coal exports have been hit by uncertainty surrounding coal exports to China and a Covid-19-induced slowdown in the steel industry. The value of metallurgical coal exports, used in steelmaking, is forecast to fall to A$22-billion in 2020/21 from A$34-billion in 2019/20, before recovering partially to A$27-billion in 2021/22.

Earnings from thermal coal exports, used mainly for electricity generation, are forecast to fall from A$20-billion in 2019/20 to A$15-billion in 2020/21 before rising slightly to A$16-billion in 2021/22, driven by higher prices and volumes.

Australian LNG export earnings are forecast to fall from A$48-billion in 2019/20 to A$31-billion in 2020/21 owing to weaker global prices and demand, before a partial recovery to A$37-billion in 2021/22.

Australian LNG export volumes reached 79-million tonnes in 2019/20, but are forecast to decline to 75-million tonnes in 2020/21, reflecting the impacts of Covid-19 as well as technical issues at the Prelude and Gorgon LNG plants. Exports are forecast to recover to 80-million tonnes in 2021/22.

Meanwhile, the demand for base metals is expected to rise, as world industrial activity recovers from the pandemic. Output and consumption are expected to grow for lithium, copper, nickel and zinc, which are all important to supporting renewable energy, electric vehicles and batteries.