The outbreak and spread of COVID-19 pandemic earlier this year has completely changed the worldwide economic landscape. Australia was also heavily hit by this virus, and struggling to navigate itself in this economic downturn.
Commodities, which are the main contributor to Australia's export revenue, also suffered a severe price decline among thin demand for resources.
Mining industry in Australia adopted effective protections against COVID-19. Therefore, during the period, the industry largely remained unwounded.
According to Keith Pitt, the Federal Resources Minister, the mining industry could play a pivotal role in Australia's economic recovery.
The Office of the Chief Economist (OCE) pointed that energy consumption and most commodities prices, especially the price of iron ore, have rebounded as the global resources supply is now restricted and the manufacturing industry began to resume its productions.
As of August 7, the price of iron ore on global market continued to go up, racing past $120/t and approaching the year-ago high level of $123.5/t. Australian Fe-62% iron ore was traded at $121.5/t, up 2.53%.
"Iron ore remains a major contributor to Australian export revenue. In the first four months of 2020, the nation earned the revenue of A$31.6 billion ($22.69 billion), up 21.3% year on year," said the Minister.
During the 2019-20 FY ending in July 2020, the country is expected to earn A$103 billion from exporting 852 million tonnes of iron ore. In FY 2020-21, the estimation may go up to 915 million tonnes.
LNG and Coal
Australia's LNG export is forecast to reach A$47 billion during FY 2019-20. The estimation will be lowered down to A$35 billion, due to low contract and spot prices.
2019 saw a slump in coal price around the world, and in 2020, the June quarter saw another decline in coal price and are likely to go down even further in the rest of 2020.
Australia's thermal coal export, which is expected to reach A$20 billion in FY 2019-20, is forecast to decline to A$16 billion in FY 2020-21 and inch up to A$17 billion in FY 2021-22.
Metallurgical coal export is forecast to jump sharply to A$35 billion in FY 2019-20, and to A$25 billion in FY2020-21, and increase to A$29 billion in FY 2021-22.
"COVID-19 pandemic dealt a severe blow to world and Australian economy. However, without commodities such as coal, iron ore and LNG, Australia would be in an even worse scenario."
Economy Stimulus Package
During the pandemic, the government has taken steps to boost the development of energy industry with an investment of A$ 125 million in exploration, and it also spent A$100 million on Geoscience Australia's Exploring for the Future (EFTF) programme.
This programme incorporated a series of cutting-edge geoscientific technologies, and map out the geological structure of Australia at an unparalleled level. This would help people to better develop an understanding of its resources, energy and underground water system, tapping its economic potential.
"The investment in resources will create job and opportunity. Government is hopeful to see Australia get rid of COVID-19 impact and recover from it as soon as possible. Now, we need resources and agriculture more than any time," said Keith Pitt.
(Writing by Rebecca Liu Editing by Tammy Yang)
For any questions, please contact us by firstname.lastname@example.org or +86-351-7219322.