The country exported energy and commodity products at a new high in 2022. Decline expected in 2023 and 2024.
Australia exported energy and commodity products worth $300 billion in 2022/23. This is an increase of nine percent compared to the same period of the previous year – a record high, according to the Office of the Chief Economist in its quarterly report for resources and energy. The report cites higher energy prices because of Russia’s war against Ukraine, as well as a strong U.S. dollar for the increase.
For the 2023/24 fiscal year, however, the Department of Industry said it expects Australian commodity export revenue to decline 15 percent to $259 billion, with a further decrease to $229 billion the following year. The report cites slower global economic growth in major Western countries and a more relaxed supply situation as reasons for the projected, declining prices for mineral resources. The ministry also expects energy prices to return to levels seen before the outbreak of war in Ukraine, further decreasing from current levels.
Demand for Critical Raw Materials for Renewables Remains High
But the ministry does not expect export revenues to fall in all areas: Exports of materials essential to the energy transition and the expansion of electric mobility are expected to remain above $40 billion in the coming fiscal year; they have doubled since 2021/22. Australia, which has high reserves of critical minerals such as rare earths and lithium, would also benefit here from the U.S. Inflation Reduction Act, which accelerates the energy transition in the USA, for which large quantities of minerals would be needed from the country “Down Under” and its competitors. Australia is increasingly using its resources to help diversify supply chains and thus reduce dependence on imports from China.
The Australian Department of Industry projects that critical raw materials could even become one of the country’s most important export goods by 2028 (we reported). But the resulting increase in Australian mining activity has also received criticism: in a May report, the Jubilee Australia Research Centre expressed concerns about the over-extraction of critical minerals and called for environmentally friendly approaches to mining.