Falling energy and iron ore prices and the appreciation of the Australian dollar combined to produce a 2 per cent decline in the value of minerals and energy exports for the September quarter, a new report shows.
Falling energy and iron ore prices and the appreciation of the Australian dollar combined to produce a 2 per cent decline in the value of minerals and energy exports for the September quarter, a new report shows.
The Australian Bureau of Agricultural and Resource Economic today said the decline was despite the volumes of the country's two biggest export earnings, coal and iron ore, reached record levels.
This fall contributed to the larger than expected trade and current account deficits reported this week by the ABS for the month of October.
The value of exports fell to $30.2 billion on the back of a 9 per cent appreciation of the Australian dollar against the US dollar, as well as the effect of lower bulk commodity contract prices. The full brunt of these lower contracts, most of which took effect in April, was not felt until this quarter as some exports during the June quarter were shipped at the previous contract prices.
Overall, the index of export prices of Australian minerals and energy exports fell by 11 per cent for the quarter. This was entirely due to the falling price of energy exports, with the energy export price index decreasing 14 per cent.
The main movers in this sector were thermal and coking coal, whose prices fell 9 and 24 per cent respectively, though export volumes of coking coal rose 17 per cent to reach record levels.
On the other hand, the value and volume of gas exports increased substantially for the quarter, with liquefied petroleum gas exports up $94 million (47 per cent) and liquefied natural gas exports up $133 million to (8 per cent) to $1.7 billion. The value of oil exports also increased, by 23 per cent to $2.1 billion, largely due to stronger production and the 14 per cent rise in the price of crude oil.
Iron ore export volumes also reached record levels, increasing 10 per cent on the back of an 8 per cent increase in production, which was 107 million tonnes.
Overall values were down 8 per cent however, largely due to declines in Asian contract prices for the Japanese fiscal year to March 2010.
Aside from iron ore, metal prices were generally buoyant, especially nickel and lead, which were up 36 per cent and 29 per cent respectively.
Nickel production continues to be hampered by the mine closures that followed the price slump in late 2008, however export volumes were up marginally for the quarter and the value of exports increased 31 per cent.
The copper price also rose, by 20 per cent, but export volumes were down as production fell by 7 per cent. Copper production is expected to fall further this quarter due to damage to the main haulage shaft at BHP's Olympic Dam operation.
Diamond production was up substantially during the quarter following a two month shut-down at Rio Tinto's Argyle diamond mine earlier in the year.
