Base metals, Copper, Lithium, News, Nickel, Oil & gas, Production

Digesting the latest Resources and Energy Quarterly

cargo, export, ship

Resources and energy export earnings are down, but the long-term outlook seems increasingly positive thanks to these factors.

The recent Resources and Energy Quarterly (REQ) from the Department of Industry, Science and Resources shows while export volumes are steady, earnings are forecast at $417 billion this year. This is an 11 per cent decrease from $466 billion in 2022–23.

And in the medium-term, export earnings are forecasted to ease to $369 billion in 2024–2025.

Global economic growth remains slow, with the nickel and lithium sectors feeling the brunt of it as prices are pushed to five-year lows. Despite this, the REQ finds the medium-term outlook for Australian lithium and nickel exports to remain substantial.

Metallurgical and thermal coal, as well as liquefied natural gas, are all predicted to deliver lower earnings in the coming years.

Counterbalancing this is the fact that key markets have continued to support commodity demand.

China will remain a huge influence on resource and energy commodity markets, but India is likely to account for a significantly larger share of world commodity demand by 2029.

“While global prices are easing, the March 2024 REQ shows demand is likely to be sustained for commodities used in low emissions technologies, including iron ore, copper, aluminium and lithium,” Federal Minister for Resources Madeleine King said.

Copper looks particularly good in the report, with earnings expected to reach $12.1 billion this year. Higher export volumes and rising prices are expected to see copper earnings reach $16.8 billion in 2028-2029.

“The road to net zero runs through Australia’s resources sector,” King said.

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