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Resourcesand Energy

QuarterlyDecember Quarter 2012

Acknowledgements

The macroeconomic outlook, the individual commodity outlooks and the reviews have identified BREE authors. The statistical tables were compiled and generated by the Data & Statistics Program at BREE and led by Geoff Armitage. Design and production was undertaken by the Media and Parliamentary team at the Department of Resources, Energy and Tourism, Tom Shael and the BREE Data & Statistics Program.

BREE 2012, Resources and Energy Quarterly, December Quarter 2012, BREE, Canberra, December 2012.

© Commonwealth of Australia 2012

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ISSN 1839-499X (Print)

ISSN 1839-5007 (Online)

Vol. 2, no. 2

Postal address:Bureau of Resources and Energy EconomicsGPO Box 1564Canberra ACT 2601 AustraliaPhone: +61 2 6276 1000

Email: [email protected]: www.bree.gov.au

mailto:[email protected]

ForewordIn this, the sixth release of Resources and Energy Quarterly, an overview of the global macroeconomy is provided along with the most up-to-date forecasts of production, export volumes and values for Australia’s key resource and energy commodities. In the reviews section, contributions include overviews on: iron ore pricing and costs; minerals and energy royalties; and projected levelised cost of electricity generation in Australia. The statistical tables in this issue also provide a wealth of detail on the Australian economy and the production, exports (volume and value) and prices of Australia’s resource and energy commodities.

The forecast outlook for 2012–13 for the resources and energy sector is for a substantial increase in the volume of exports for Australia’s bulk commodities (iron ore and coal) relative to 2011–12. However, as a result of a decline in the US dollar price of iron ore and coal from their levels in early 2012, the total value of these exports is expected to decline.

In 2008–09 when commodity prices fell in response to the Global Financial Crisis (GFC) the value of the Australian dollar also fell sharply in response. By contrast, in 2012–13 the Australian dollar is at close to historic highs, and is projected to remain at about this level over the coming year despite a decline in key commodity prices. As a result, falls in the US dollar price of commodities have not been compensated by a corresponding reduction in the Australian dollar as occurred during the GFC which has a negative impact on Australian exporters.

A fall in the export price of key Australian mineral exports, coupled with a high Australian dollar, is expected to result in a 4 per cent decline in the export value of resources and energy exports in Australian dollar terms in 2012–13 relative to 2011–12. The total forecast value of resources and energy exports in 2012–13 is about $184 billion or some $9 billion less than in 2011–12.

As noted in previous issues of Resources and Energy Quarterly, further growth in Australia’s export earnings from resources and energy will depend on increased volumes. This is because resource commodity prices, with a few exceptions, are not expected to return in real terms to their historic highs of 2011–12.

Quentin Grafton

Executive Director/Chief Economist

Bureau of Resources and Energy Economics

ContentsForeword..................................................................................................................................4

Contents...................................................................................................................................5

Macroeconomic outlook update and energy and minerals overview.......................................6

Energy outlook........................................................................................................................13

Oil.......................................................................................................................................13

Gas......................................................................................................................................17

Thermal coal.......................................................................................................................18

Resources outlook..................................................................................................................21

Steel and steel-making raw materials.................................................................................21

Gold....................................................................................................................................27

Aluminium..........................................................................................................................30

Alumina...............................................................................................................................32

Copper................................................................................................................................34

Nickel..................................................................................................................................37

Zinc.....................................................................................................................................40

Reviews...................................................................................................................................43

Overview of iron ore pricing and costs...............................................................................44

Minerals and energy royalties in Australia..........................................................................48

The levelised cost of electricity in Australia........................................................................53

Statistical tables......................................................................................................................59

Macroeconomic outlook update and energy and minerals overviewNhu Che, Pam Pham and Quentin Grafton

Global economy: risks remainRisks to the world economy identified in the September issue of Resources and Energy Quarterly remain. The global economy has deteriorated since the release of the IMF July 2012 World Economic Outlook Update, and growth projections have been reduced. In particular, global manufacturing has slowed and the euro area periphery has seen a marked decline in activity in the past 6 months. Economic growth in larger developed economies, including Germany, France, Italy, Japan, the UK and the US all remain beneath potential.

The ongoing debt crisis in the EU and its spill-over to the real economy and large exporting countries, especially China, the ability of the US to smoothly manage its fiscal consolidation in 2013 and worries over the strength of the US recovery all remain key concerns for the short-term economic outlook. Spillovers from the slowdown of economic growth in advanced economies and domestic challenges have also moderated growth in key emerging economies such as India and Brazil. Nevertheless, China’s annual growth rate remains robust although down from the close to 10 per cent growth rate over the previous decade.

Global economic growth in 2012 is assumed to be 3.3 and 3.6 per cent for 2012 and 2013, respectively (see Table 1), which is sharply down on the 5 per cent growth in 2010. Economic activity in the euro zone is contracting as a result of recessions in key periphery economies and low growth in the Euro core. On the positive side, there have been recent interventions by the European Central Bank, especially its Outright Monetary Transactions program, that have reduced interest rates on sovereign debt and further progress has been made in terms of moving Greece towards a more sustainable debt level. In particular, an agreement on 27 November by euro zone Ministers to further reduce Greek debts by 40 billion euros after the Greek parliament had approved spending cuts of 9.4 billion euros provides breathing space in the unfolding Greek debt crisis.

The US economic growth rate is assumed to be 2.2 and 2.1 per cent for 2012 and 2013, respectively with a likely pick up in its housing sector. The assumed moderate economic growth and very recent contraction in US manufacturing activity will make it difficult for it to substantially reduce the currently high unemployment rate over the coming year. The biggest risk for US growth in 2013 is its ability to avoid the ‘fiscal cliff’ that includes an automatic increase in taxes of about US$400 billion and also cuts in spending of some US$200 billion that will come into force on 1 January 2013 that, without some change, risk putting the US back into a recession.

The OECD economies are expected to grow at lower rate than the assumed rate in the September 2012 Resources and Energy Quarterly, with growth assumed to be 1.2 per cent in 2012 and 1.4 per cent in 2013. Over the near term, the prospects for

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emerging economies are much better than those for advanced economies with assumed growth rates for China of 7.8 per cent in 2012 and 8.2 per cent in 2013. The assumed growth rate in India of 4.9 per cent in 2012, however, represents a sharp fall from the 6.8 per cent growth it experienced in 2011. Economic growth for developing economies as a whole is assumed to be 6.1 per cent in 2012, but to increase to 6.2 per cent in 2013 (see Table 1).

Table 1: Key macroeconomic assumptions for resources and energy2010 2011 2012 a 2013 a

Economic growth b cOECD % 3.0 1.3 1.2 1.4United States % 3.0 1.8 2.2 2.1Japan % 4.0 –0.8 2.3 1.3Western Europe % 1.8 1.3 –0.4 0.5Germany % 3.7 3.2 0.9 0.9France % 1.5 1.7 0.1 0.4United Kingdom % 1.4 0.8 –0.4 1.1Italy % 1.3 0.4 –2.3 –0.7Republic of Korea % 6.2 3.6 2.7 2.7New Zealand % 1.7 1.1 2.2 3.1Emerging countries % 7.8 6.6 6.1 6.2Non-OECD Asia % 9.6 7.7 6.5 7.2South East Asia d % 6.9 4.5 5.4 5.8China e % 10.3 9.2 7.8 8.2Chinese Taipei % 10.9 4.1 1.3 4.0Singapore % 14.5 5.0 2.1 3.0India % 9.0 6.8 4.9 6.0Latin America % 6.1 4.5 4.5 3.2Middle East % 3.8 3.5 3.3 5.3Russian Federation % 4.0 4.3 3.7 3.8Ukraine % 4.2 5.2 3.0 3.5Eastern Europe % 4.2 5.3 2.0 2.6World c % 5.0 3.8 3.3 3.6

Industrial production bOECD % 7.9 –0.5 1.0 1.2Japan % 15.4 –3.1 7.1 5.9China % 15.7 9.9 8.8 9.4Inflation rate bUnited States % 1.6 4.3 2.3 2.3Interest ratesUS prime rate g % pa 3.3 3.3 3.3 3.3

a BREE assumption. b Change from previous period. c Weighted using 2012 purchasing power parity (PPP) valuation of country gross domestic product by the IMF. d Indonesia, Malaysia, the Philippines, Thailand and Vietnam. e Excludes Hong Kong. g Commercial bank lending rates to prime borrowers in the US.Sources: BREE; ABS; IMF; OECD; RBA.

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Economic prospects in Australia’s major mining export markets

Non-OECD economiesIn emerging Asia, the IMF forecasts GDP to accelerate to a 7.2 per cent pace in the second half of 2012. The main driver of economic activity is China, where output is expected to receive a boost from an accelerated approval process of public infrastructure projects. The outlook for India is unusually uncertain: for 2012, with weak growth in the first half and a continued investment slowdown.

China’s economic growth remains robust (assumed to be 7.8 and 8.2 per cent in 2012 and 2013, respectively), but weaker than in previous years. According to the IMF, the Chinese economy slowed sharply, owing to a tightening in credit conditions that was in response to surging real estate prices, a return to a more sustainable pace of public investment, and weaker external demand (Figure 1).

Figure 1: Economic growth in Australia’s major resource and energy export markets

Please refer to page 3 of the Resources and Energy Quarterly – December quarter 2012 PDF version.

Economic growth in India is assumed to be 4.9 per cent in 2012. The IMF attributes this lower rate of growth to waning business confidence, amid slow approvals for new projects, sluggish structural reforms, increases in interest rates to control inflation, and flagging external demand.

Due to continued robust investment, near-term growth in ASEAN countries (including Indonesia, Malaysia, Philippines, Thailand, and Vietnam) is assumed to be around 5.4 per cent in 2012. In sum, despite moderation in growth forecasts, non-OECD Asia remains the fastest growing region in the world, but at a lower rate of 6.5 per cent in 2012 and the 7.2 per cent in 2013 that was previously assumed in the September Resources and Energy Quarterly.

OECD economiesEconomic growth in OECD economies is assumed to be 1.2 per cent in 2012 which is 0.2 percentage points lower than previously assumed in September Resources and Energy Quarterly.

Germany’s economic growth in 2012 is assumed to be 0.9 per cent per year in both 2012 and 2013 (Table 1). The US’s economy grew at 0.5 per cent in the September quarter 2012 with economic growth assumed to be 2.2 and 2.1 per cent for 2012 and 2013, respectively (Table 1). According to the IMF, weak household balance sheets and confidence, relatively tight financial conditions, and continued fiscal consolidation will constrain stronger economic growth. In the very short term, the current drought will detract from output. Another concern is that while the unemployment rate has fallen to about 8 per cent from around its peak of 10 per cent, about 40 per cent of those unemployed have been out of work for more than six months.

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In Japan, the pace of growth will diminish noticeably as post-earthquake reconstruction winds down. According to the IMF, Japan’s economic growth is projected to slow and is assumed to be 2.3 per cent in 2012 and 1.3 per cent in 2013. Economic growth in the Republic of Korea is assumed to be 2.7 per cent for both 2012 and 2013 which is 0.6 and 1.0 percentage points lower than that forecast by BREE in September 2012.

Australia’s economic prospectsReal GDP in Australia (based on a PPP valuation of GDP in July 2012) is estimated to have grown at an annual rate of 3 per cent in 2011–12 and is assumed to grow by a further 3.3 per cent in the financial year 2012–13 (see Table 2).

Table 2: Australia’s key macroeconomic assumptions for resources and energy2009–10 2010–11 2011–12 2012–13 a

Economic growth b c % 2.3 1.8 3.0 3.3Inflation rate b % 2.3 3.1 2.7 2.9Interest rates d % pa 6.0 6.6 7.2 6.7Nominal exchange rates eUS$/A$ US$ 0.88 0.99 1.03 1.01Trade weighted index for A$ g index 69 74 76 76

a BREE assumption. b Change from previous period. c Weighted using 2011 purchasing power parity (PPP) valuation of country gross domestic product by IMF. d Large business weighted average variable rate on credit outstanding. e Average of daily rates. g Base: May 1970 = 100.Sources: BREE; ABS; RBA.

The Australian dollar has increased in value, relative to other currencies, over the last three months. In the September quarter 2012, the Australian dollar traded at an average of US104c and TWI 78. This compares with US106c and TWI 78 in the March quarter 2012 and US101c and TWI 75 in the June quarter. In November and early- December, the Australian dollar traded around US104c while the trade-weighted index was around 77.

Over the near term it is assumed that the Australian dollar will decrease slightly to around US101c due to reduced demand for China’s exports to Europe and either lower or unchanged interest rates in Australia (see Figure 2).

Figure 2: Australian historical and forecast assumption of exchange rates


There are several important drivers of the Australian exchange rate over short term. In 2012–13, factors that may cause the Australian dollar to weaken include the effect of the continuing euro zone recession and its impact on emerging economies; lower economic growth in China; a further decline in commodity prices; a slower than expected recovery of the US economy; and any decline in domestic interest rates. Factors that may be expected to strengthen the Australian dollar include continued

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stronger than expected economic growth in Australia; a rebound in European and Chinese economic growth in 2013, and the continuation of low ongoing interest rates in the US and other advanced economies.

Australian resources and energy commodities production and exportsIn 2011–12, the gross value added produced from mining activities was about $130.1 million, accounting for about 9 per cent of Australian gross domestic product.

In 2011–12, high commodity prices, particularly in late 2011, and strong growth in export volumes underpinned Australia’s earnings from energy and mineral commodity exports that reached a record level. Export earnings from resources and energy grew 8 per cent relative to 2010–11 to total $193 billion. Export earnings from mineral commodities contributed $116 billion and accounted for about 60 per cent of the total. Export earnings from energy commodities accounted for a smaller share, 40 per cent, and contributed approximately $77 billion to the total value of Australian energy and minerals exports (Figure 3 and Table 4).

Figure 3: Australian mine production


In 2011–12, high commodity prices, particularly in late 2011, and strong growth in export volumes underpinned Australia’s earnings from energy and mineral commodity exports reaching a record level. Export earnings from resources and energy grew 8 per cent relative to 2010–11 to total $193 billion. Export earnings from mineral commodities contributed $116 billion and accounted for about 60 per cent of the total. Export earnings from energy commodities accounted for a smaller share, 40 per cent, and contributed approximately $77 billion to the total value of Australian energy and minerals exports.

Figure 9: Australian energy and minerals export earnings


Export earnings in 2012–13 are expected to decrease due to lower commodity prices relative to 2011–12. While some commodity prices are forecast to recover later in the financial year, they are expected to remain below their historic high prices in 2011. Thus, Australia’s export earnings are forecast to total $184 billion in 2012–13, down 4 per cent from the record high of $193 billion in 2011–12, but higher than the value of resources and energy exports in 2010–11. Energy commodity earnings are forecast to decrease by 1 per cent to total $76 billion due to higher export earnings from liquefied natural gas (up 37 per cent to $16.4 billion), thermal coal (up 6 per cent to $18.1 billion) and oil (up 7 per cent to $14.1 billion) being offset by a decrease in export earnings from metallurgical coal (down 24 per cent to $23.2 billion).

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Mineral commodity export earnings are forecast to decrease 7 per cent to total $108 billion, primarily as a result of a decrease in the export value of iron ore (down 13 per cent to $55 billion). Decreases in export value are also forecast for nickel (down 17 per cent to $3.4 billion), aluminium (down 16 per cent to $3.2 billion) and zinc (down 6 per cent to $2.2 billion). Partially offsetting these are forecast increases in alumina (up 18 per cent to $6 billion) and gold (up 5 per cent to $16.3 billion). The export value of copper is forecast to remain more or less unchanged at around $8.5 billion in 2012–13.

Overall, a slowdown in global growth is expected to moderate the growth in Australian production and exports of energy and minerals commodities in 2012–13 (see Table 3). The major indicators for Australia’s resources and energy commodity sector are presented in Table 4. Detailed forecasts and projections for major energy and minerals commodities are outlined in the following Energy Outlook and Resources Outlook sections.

Table 3: Australia’s resources and energy commodity exports, by selected commodities

Volume Value2011–12 2012–13 f growth % 2011–12 2012–13 f growth %

Alumina kt 16592 18578 12.0 $m 5146 6049 17.5Aluminium kt 1693 1576 –6.9 $m 3797 3195 –15.9Copper t 889 915 2.9 $m 8489 8464 –0.3Gold t 304 297 –2.3 $m 15462 16291 5.4Iron ore Mt 470 512 8.9 $m 62703 54638 –12.9Nickel kt 240 238 –0.8 $m 4063 3386 –16.7Zinc kt 1578 1538 –2.5 $m 2302 2161 –6.1LNG Mt 19 24 26.3 $m 11962 16360 36.8Metallurgical coal Mt 142 154 8.5 $m 30708 23790 –22.5

Thermal coal Mt 158 180 13.9 $m 17111 18085 5.7Oil ML 19214 20586 7.1 $m 13206 14128 7.0Uranium t 7499 7546 0.6 $m 670 704 5.1

f BREE forecast.Sources: BREE; ABS.

Table 4: Major indicators for Australia’s resources and energy commodity sector2007–08

2008–09

2009–10

2010–11

2011–12

2012–13 f

Change from previous year (%)2011–12

2012–13

Commodity exportsExchange rate US$/

A$ 0.90 0.75 0.88 0.99 1.03 1.01 4.0 –1.9

Unit returns bResources and energy

index 100.0 135.6 107.0 138.3 139.4 123.9 0.8 –11.1

– energy index 100.0 168.9 109.8 135.3 145.8 130.5 7.8 –10.5– metals and index 100.0 113.0 105.3 140.7 135.6 119.8 –3.6 –11.7

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2007–08

2008–09

2009–10

2010–11

2011–12

2012–13 f

Change from previous year (%)2011–12

2012–13

other mineralsValue of exportsResources and energy

A$m 117362

161788

139497

179237

192626

184636 7.5 –4.1

– energy A$m 45591 77892 57478 70143 77105 76854 9.9 –0.3– metals and other minerals

A$m 71771 83895 82019 109094

115521

107783 5.9 –6.7

Total commodities

A$m 148702

197693

171577

215316

230721

221923 7.2 –3.8

Resources and energy sectorVolume of mine production

index 120.4 121.1 125.3 130.5 131.1 126.7 0.5 –3.4

– energy index 116.9 122.6 127.2 121.9 121.2 109.1 –0.6 –10.0– metals and other minerals

index 124.1 119.6 123.2 138.9 141.0 145.0 1.5 2.8

Gross value of mine production

A$m 112667

155316

133918

172067

184921

177251 7.5 –4.1

b Base 2011–12=100. f BREE forecast. z BREE projection.Sources: BREE; ABARES; ABS.

Majority Australian commodity exports


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Energy outlook

OilPam Pham, Nhu Che and Alex Feng

Oil pricesCrude oil prices dropped substantially during the June quarter of 2012, but have gained some momentum in the September quarter. Overall, the West Texas Intermediate (WTI) oil price increased from an average of US$90.6 a barrel in the June quarter to an average of US$91.9 a barrel in the September quarter 2012. The price of Brent increased from an average of US$105.2 a barrel to an average of US$109 a barrel (see Figure 1).

Figure 1: WTI and Brent oil prices


The WTI price is forecast to average around US$93 a barrel in 2012 and US$99 a barrel in 2013. The Brent price is forecast to average around US$110 a barrel in 2012 and 2013. Increasing global oil supply and a slowdown in Chinese demand are expected to lead to lower oil prices in 2012 while increasing oil consumption and persistently low OPEC spare capacity will support forecast higher oil prices in 2013.

World oil consumptionWorld oil consumption is forecast to increase by 1 per cent in 2012 to average 89.8 million barrels a day. In 2013, economic activity is assumed to pick-up and world oil consumption is forecast to increase by 1 per cent to average 90.4 million barrels a day (see Figure 2). Increases in non-OECD consumption are expected to offset moderate falls in OECD consumption.

Consumption in the OECD is forecast to increase 1 per cent in 2012 to average of 46.3 million barrels a day. Increased demand in the OECD Pacific, particularly Japan, is forecast to offset a decline in oil consumption in Europe. Increases in OECD Pacific oil consumption are forecast to be supported by continued oil-fired electricity generation demand in Japan as a result of the temporary shutdown of many of its nuclear power plants. In 2013, OECD oil consumption is forecast to decrease by 2 per cent due to weaker economic growth in Europe and a slow growth forecast in North America. A gradual recovery in the Japanese nuclear capacity in 2013 is also expected to contribute to a decline in OECD oil consumption.

Consumption in non-OECD economies remained more or less unchanged in 2012 compared with 2011, averaging 43.5 million barrels a day. Increases in demand from China offset declines in demand from Latin America and the Middle East. Assumed weaker economic growth in 2012 will restrain China’s oil consumption which is forecast to grow by only 1 per cent, down from 5 per cent in 2011. Low natural gas and coal prices along with new power generation capacity in Mexico are expected to

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contribute to a 3 per cent decrease in oil consumption in Latin America in 2012. Consumption in non-OECD economies is forecast to increase by 3 per cent in 2013 and to average 44.9 million barrels a day. Most of this growth is attributed to rising Chinese oil consumption on the back of a more robust forecast economic outlook in 2013.

Figure 2: World oil consumption


World oil productionWorld oil production is forecast to increase by 2 per cent in 2012 to total 90.2 million barrels a day (see Figure 3). In 2013, world oil production is forecast to increase by 1 per cent to average 91.4 million barrels a day, largely attributed to forecast 2 per cent growth in OPEC production that is forecast to average 37.7 million barrels a day. Non-OPEC production is forecast to increase by around 1 per cent in 2012 relative to 2011. Continued planned and unplanned outages are expected to moderate growth in non-OPEC production during 2012.

North America’s oil production is forecast to increase by 8 per cent in 2012, offsetting declines in non-OPEC producers in the Middle East, Africa and Europe. US oil production is forecast to increase 10 per cent in 2012 to average 8.9 million barrels a day. Planned maintenance at some facilities in the Gulf of Mexico and production delays due to hurricane impacts are expected to partially offset growth in tight oil production. In 2013, US oil production is forecast to grow by 5 per cent to average 9.4 million barrels a day.

Growth in Canada’s oil production is forecast to increase by 11 per cent in 2012 as a result of higher oil sands production. Planned maintenance in Canada’s offshore producing areas is expected to moderate Canadian oil production growth in 2012. In 2013, Canada’s oil production is expected to increase by 5 per cent to average 4 million barrels a day.

Oil production in Latin America in 2012 is forecast to remain at the same level as 2011, or at around 4.2 million barrels a day. This is mostly because of the continued shut-in of the Frade field in Brazil. In 2013, production is also forecast to remain at a similar level.

OPEC oil production is forecast to increase by 4 per cent in 2012 and by 2 per cent in 2013. Forecast growth in OPEC production is underpinned by higher production of natural gas liquids, while OPEC crude oil production is forecast to increase by 1 per cent in 2013.

Figure 3: World oil supply


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Australia’s oil production and exportsAustralia’s production of crude oil and condensate is estimated to have decreased 8 per cent in 2011–12, relative to 2010–11, to total 22.8 gigalitres. Lower production reflects planned maintenance on the North West Shelf due to redevelopment, multiple unplanned shut-ins throughout the Carnarvon Basin during cyclone season, and declines in production from maturing fields. Output from the Kitan project in the Bonaparte Basin, which commenced in October 2011, is expected to partially offset these declines. In 2012–13, Australia’s crude oil and condensate production is forecast to increase by 3 per cent as a result of the commencement of crude production from the Montara-Skua project and condensate from the Kipper gas project.

In 2011–12, Australia’s exports of crude oil and condensate decreased by 2 per cent relative to 2010–11, to total 19.2 gigalitres (see Figure 4). Despite the fall in the export volume, the value of Australia’s crude oil and condensate exports increased by 8 per cent to $13.2 billion in 2011–12. In 2012–13, the value of crude oil and condensate exports is forecast to increase by 7 per cent to total $14.1 billion.

Figure 4: Australia’s crude oil and condensate exports


Table 1: Oil outlook2011 2012 f 2013 f % change

WorldProduction b mbd 88.3 90.2 91.4 1.4Consumption mbd 89.2 89.8 90.4 0.7West Texas Intermediate crude oil price

US$/bbl 95 93 99 6.7

Brent crude oil price US$/bbl 110 110 110 0.52010–11 2011–12 2012–13 f % change

AustraliaCrude oil and condensateProduction b ML 24745 22826 23537 3.1Exports ML 19638 19214 20586 7.1– value A$m 12245 13206 14128 7.0Imports ML 32225 29495 29871 1.3Production c ML 3907 3815 3928 2.9Exports ML 2471 2115 2296 8.6– value A$m 1068 971 1100 13.3

b One megalitre a year equals about 17.2 barrels a day. c Primary products sold as LPG. d Energy Quest. f BREE forecast.Sources: BREE; ABARES; Australian Bureau of Statistics; Energy Information Administration (US Department of Energy); Energy Quest; International Energy Agency.

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GasNhu Che and Pam Pham

Australia’s gas outlookAustralian gas production fell by 5 per cent, relative to 2010–11 to total 50.5 billion cubic meters in 2011–12. Lower production was a result of maintenance at LNG facilities, declines from maturing fields in the Gippsland Basin and delays to the Kipper project located of the coast of Victoria.

In 2012–13, Australian gas production is forecast to increase by 16 per cent, relative to 2011–12, to total 58.7 billion cubic metres. This increase in production is expected to come from operations commencing at new gas fields. In 2012–13, the first stage of the Kipper/Tuna/Turrum project in the Gippsland Basin, the Macedon project in the Carnarvon Basin, the Spar project in the Carnarvon Basin and the BassGas projects in the Bass Strait Basin are scheduled for start-up. The NWS North Rankin B located near Dampier will be expanded in 2013.

In 2012–13, Australia’s LNG export volumes are forecast to increase 23 per cent to total 24 million tonnes. Australia’s LNG export earnings are forecast to increase by 37 per cent in 2012–13, to reach $16.4 billion. The growth is underpinned by higher export volumes and higher oil-linked LNG contract prices in 2012–13.

Figure 1: Australia’s LNG exports


Table 2: Gas outlook2010–11 2011–12 2012–13 f % change

AustraliaProduction Gm3 53.1 50.5 58.7 16.2LNG exports Mt 19.96 19.25 23.58 22.5– value A$m 10437 11962 16360 36.8

f BREE forecast.Sources: BREE; ABARES; Department of Resources, Energy and Tourism.

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Thermal coalTom Shael and John Barber

Thermal coal pricesThe 2013 Japanese Financial Year (JFY, April 2013 to March 2014) contract price is forecast to settle at about US$100 a tonne as a result of on thermal coal spot prices increasing slightly from current levels. This would be a 13 per cent decline from the JFY 2012 price of US$115 a tonne from earlier in 2012.

Figure 1: JFY thermal coal prices


World trade in thermal coalIn 2012, trade of thermal coal is forecast to total 899 million tonnes, an increase of 4 per cent relative to 2011. In 2013, total trade is forecast to increase by a further 4 per cent to total 934 million tonnes.

Imports

Higher consumption demand for electricity generation in Asia is expected to support growth in world imports of thermal coal in both 2012 and 2013. China is forecast to increase its seaborne imports by 16 per cent in 2012, compared with 2011, to total 170 million tonnes. A further increase of 5 per cent is forecast in 2013, resulting in total imports of 179 million tonnes for the year. India’s thermal coal imports are forecast to increase by 3 per cent in 2012 to total 89 million tonnes, and by a further 10 per cent in 2013 to reach 98 million tonnes.

In 2012, imports into the EU are forecast to fall by 1 million tonnes to total 164 million tonnes. The decline is expected as a result of continuing euro zone debt issues and weak economic growth resulting in lower electricity demand. Moderate improvements in European economic conditions in 2013 are expected to result in thermal coal imports recovering to 165 million tonnes.

Japan’s imports of thermal coal are forecast to increase by 5 per cent in 2012 to total 128 million tonnes. Higher imports of coal in 2012 are due to the shut-down of most of Japan’s nuclear power plants following the 2011 Fukushima nuclear incident. In 2013, Japan’s imports of thermal coal are forecast to increase by a further 2 per cent, to total 130 million tonnes.

Exports

Growth in consumption demand for thermal coal in 2012 has been supported by higher exports from Australia, Indonesia and Colombia. In 2012, Australia’s exports of thermal coal are forecast to increase to 167 million tonnes, 13 per cent higher than 2011. Increased volumes are forecast from: Xstrata’s Mangoola mine (annual capacity of 8 million tonnes), stage 1 of Yancoal’s Moolarben mine (8 million tonnes)

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and Peabody Energy’s expansion of its Wilpinjong operation (additional annual capacity of 2–3 million tonnes).

In 2013, Australia’s exports are forecast to increase 11 per cent, relative to 2012, to total 186 million tonnes. This increase will be supported by production from soon-to-be-commissioned mines that include the Hunter Valley Operations Expansion (6 million tonnes) and Narrabri Coal Project stage 2 expansion (4.5 million tonnes).

Thermal coal exports from Indonesia are forecast to increase by 2 per cent in 2012, relative to 2011, to total 315 million tonnes. In 2013, this is forecast to grow by an additional 5 per cent to total 330 million tonnes.

In the US, cheap domestic gas has caused a surplus of coal production relative to demand in 2012, the balance of which has been sent predominantly to export markets. Accordingly, US thermal coal exports in 2012 are expected to increase by 34 per cent, relative to 2011, to total 50 million tonnes. In 2013, lower export prices and higher domestic gas prices in the US are forecast to result in a decrease in export volumes to 40 million tonnes.

Australia’s thermal coal production and exportsIn 2012–13, production of thermal coal in Australia is forecast to increase by 9 per cent, to total 243 million tonnes. Australia’s exports of thermal coal in 2012–13 are forecast to total 180 million tonnes, an increase of 13 per cent relative to 2011–12. This forecast higher export volume is expected to offset lower coal prices and result in export earnings increasing 6 per cent to total $18.1 billion.

Figure 2: Australia’s thermal coal exports


Table 1: Thermal coal outlook2011 2012 f 2013 f % change

WorldThermal coal Contract prices b US$/t 130 115 100 –13.0

Coal trade Mt 866 899 934 3.9ImportsAsia Mt 577 616 644 4.5– China Mt 146 170 179 5.3– Chinese Taipei Mt 63 63 63 0.0– India Mt 86 89 98 10.1– Japan Mt 122 128 130 1.6– Korea, Rep. of Mt 97 99 101 2.5– Malaysia Mt 21 21 22 3.9– other Asia Mt 42 47 51 9.6Europe Mt 211 209 212 1.6– European Union 27 c Mt 165 164 165 0.5

– other Europe Mt 46 45 47 5.2Other Mt 77 74 78 5.3

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2011 2012 f 2013 f % changeExportsAustralia Mt 148 167 186 11.5China Mt 11 10 10 0.0Colombia Mt 75 80 82 2.5Indonesia Mt 309 315 330 4.8Russian Federation Mt 109 110 112 1.8South Africa Mt 72 75 76 1.3United States Mt 34 50 40 –20.0Other Mt 104 94 97 2.8

2010–11 2011–12 2012–13 f % changeAustraliaProduction Mt 206.1 222.9 242.9 9.0Exports Mt 143.3 158.5 179.6 13.3– value A$m 13956 17111 18085 5.7

b Japanese Fiscal Year, starting April 1, fob Australia basis, BREE Australia–Japan average contract price assessment. For steaming coal with a calorific value of 6700 kcal/kg (gross air dried. c Regarded as 27 countries for all years. f BREE forecast. s BREE estimate.Sources: BREE; ABARES; International Energy Agency; Coal Services Pty Ltd; Queensland Department of Mines and Energy.

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Resources outlook

Steel and steel-making raw materialsTom Shael

Bulk commodity prices

Iron ore spot prices for 62 per cent iron ore content free on board (FOB) Australia averaged around US$105 a tonne in the third quarter of 2012. Spot prices in this quarter reached a low of around US$81 a tonne, the lowest level in real terms since late 2009. This substantial decrease in spot prices was a result of Chinese steelmakers running down inventories and also concerns over future growth in the Chinese steel-making industry. Spot prices in the December quarter have since rebounded and have averaged around US$108 a tonne. For 2012 as a whole, contract prices are expected to average around US$128 a tonne (see Figure 1).

In 2013, prices are forecast to decrease further and average around US$106 a tonne. Prices in the first half of 2013 are expected to remain around current levels, while prices are forecast to increase in the fourth quarter of 2013 in line with an expected increase in steel consumption demand resulting from Chinese Government infrastructure project and stimulus spending.

Benchmark contract prices for high-quality hard coking coal delivered in the March quarter 2013 have settled at around US$165 a tonne. The US$5 a tonne decrease from the December quarter 2012 contract price reflects continued negative sentiment in the market and resiliently low spot prices. For 2012 as a whole, contract prices averaged US$210 a tonne. High quality hard coking coal contract prices are forecast to decrease to average around US$171 a tonne in 2013, underpinned by increased world supply.

Figure 1: Raw material contract prices, FOB Australia


World steel consumptionIn 2012, world steel consumption is forecast to increase by 3 per cent, relative to 2011, to total 1.49 billion tonnes. A substantial portion of this consumption growth is attributable to growing demand from the construction of infrastructure projects in emerging economies. In 2013, world steel consumption is forecast to increase by about 4 per cent, compared with 2012, to total 1.55 billion tonnes (see Table 1).

Table 1: World steel consumption and production (Mt)2010 2011 2012f 2013f

Crude steel consumptionEuropean Union 27 160 162 161 161United States 90 94 95 98Brazil 30 31 32 34

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2010 2011 2012f 2013fRussian Federation 42 44 46 48China 600 624 643 668Japan 68 68 72 74Korea, Rep. of 55 57 60 64India 66 76 81 86World steel consumption 1389 1450 1491 1548Crude steel productionEuropean Union 27 173 176 171 170United States 81 86 90 91Brazil 33 35 35 37Russian Federation 67 69 72 75China 627 683 704 732Japan 110 108 108 110Korea, Rep. of 58 68 70 72India 67 72 76 82World steel production 1415 1510 1537 1586

Sources: BREE; World Steel Association.

China’s steel consumption in 2012 is forecast to increase by 3 per cent, to total 643 million tonnes. The slower rate of growth compared with 2011 is expected as a result of many post-GFC fiscal stimulus programs reaching completion. In 2013, China’s steel consumption is forecast to increase by 4 per cent to total 668 million tonnes. The commencement of construction on Government-funded infrastructure projects is expected to increase steel consumption demand in the second half of 2013.

An assumed contraction in economic growth in the EU is forecast to result in steel consumption remaining largely unchanged in 2012 and 2013 compared with 2011. Demand for steel in India for infrastructure projects is expected to increase steel consumption by 7 per cent in 2013.

World steel productionWorld steel production is forecast to increase by 2 per cent in 2012, compared with 2011, to total 1.54 billion tonnes. Further growth of 3 per cent to 1.59 billion tonnes is forecast for 2013.

In the first 10 months of 2012, China’s steel production was 594 million tonnes. Although production slowed in August through October, the average production rate of 58.6 million tonnes per month during this period is still historically high. For 2012 as a whole, China’s steel production is forecast to increase, albeit at a slower rate, compared with 2011. China’s steel production in 2013 is forecast to increase by 4 per cent, relative to 2012, to total 732 million tonnes. The growth is in line with higher domestic consumption demand from infrastructure projects and forecast higher exports of steel products.

India’s steel production from January to October 2012 was 64 million tonnes, 6 per cent higher than produced in the same period of 2011. In 2012, India’s steel production is forecast to increase by 6 per cent to total 76 million tonnes. Steel

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production is forecast to grow strongly again in 2013, increasing by 7 per cent to 82 million tonnes supported by assumed robust economic growth.

Steel production in the EU in 2012 is forecast to decrease by 3 per cent, relative to 2011, to total 171 million tonnes. The forecast decline in production is in line with assumed weak economic growth in key steel producing economies. Production in 2013 is forecast to remain relatively unchanged at 170 million tonnes as the steel industry continues to consolidate in response to lower European demand.

Figure 2: Quarterly world steel production


World trade in iron oreWorld trade in iron ore in 2012 is forecast to increase by 5 per cent, relative to 2011, to total 1.14 billion tonnes. World trade of iron ore in 2013 is forecast to increase by a further 5 per cent to 1.20 billion tonnes (see Table 2).

Iron ore imports

China’s imports of iron ore in 2012 are forecast to increase by 6 per cent, compared with 2011, to total 730 million tonnes. In 2013, imports are forecast to increase by a further 5 per cent to total 769 million tonnes. Growth in imports is expected as a result of robust steel production, some high-cost domestic iron ore operations closing or scaling-back production in response to lower iron ore prices, and declining average iron content of domestically mined ore.

Imports into the EU in 2012 and 2013 are forecast to remain relatively unchanged at around 136 million tonnes. The lack of growth in iron ore imports into the EU is a result of forecast lower steel production in 2012 and 2013, relative to 2011. Imports into Japan and the Republic of Korea are expected to continue to increase in line with forecast growth in steel production in 2012 and 2013.

Table 2: World iron ore trade (Mt)2010 2011 2012f 2013f

Iron ore importsEuropean Union 27 133 134 136 136Japan 134 128 131 132China 619 687 730 769Korea, Rep. of 55 65 67 70Iron ore exportsAustralia 402 438 481 543Brazil 311 324 327 327India 96 50 51 38Canada 33 32 35 35South Africa 48 43 48 50West Africa (Guinea & Mauritania) 11 11 12 12World trade 1052 1090 1143 1202

Source: BREE.

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Iron ore exports

In 2012, Brazil’s iron ore exports are forecast to increase by 1 per cent, relative to 2011, to total 327 million tonnes. In 2013, Brazil’s exports are forecast to remain constant at 327 million tonnes due to forecast lower exports from the country’s largest supplier, Vale, to Europe.

Iron ore exports from India are forecast to decline by 26 per cent in 2012 in response to continued Government measures against illegal mining. Production in the state of Goa ceased in 2012, as recommended by the Shah Commission. The Commission is expected to release its report on the large iron ore producing state of Odisha in early 2013. A decrease in iron ore production in India provides a two-fold benefit to other exporting economies; namely the shortfall in lower quality ore previously exported from India to China, and exports to India itself, where demand from steel mills in certain geographic locations could exceed domestic supply.

In calendar year 2012, Australia’s exports of iron ore are forecast to increase by 10 per cent, relative to 2011, to total 481 million tonnes. The increase will be supported by expansions to capacity at a number of projects owned by Australia’s larger operators, including Rio Tinto and BHP Billiton. In calendar year 2013, Australia’s iron ore exports are forecast to increase by 13 per cent, to total 543 million tonnes. This is the result of reaffirmed commitments to expansion of projects that appeared much less certain during the September quarter of 2012. Some of the projects that are expected to support growth in Australia’s production and exports in 2013 include: Fortescue Metal Group’s Chichester Hub (annual capacity of 40 million tonnes) and the Firetail deposit at its Solomon Hub (20 million tonnes); CITIC Pacific Mining’s Sino Iron Project (28 million tonnes); and Rio Tinto’s Hope Downs 4 (15 million tonnes).

World trade in metallurgical coalWorld trade of metallurgical coal is forecast to increase by 5 per cent in 2012, relative to 2011, to total 272 million tonnes. In 2013, world trade is forecast to increase by a further 5 per cent to 286 million tonnes supported by strong import growth in China and India (see Table 3).

Table 3: World metallurgical coal trade (Mt)2010 2011 2012f 2013f

Metallurgical coal importsEuropean Union 27 45 45 46 46Japan 58 54 54 55China 35 38 49 58Korea, Rep. of 28 32 33 34India 19 19 22 26Brazil 11 12 13 14Metallurgical coal exportsAustralia 159 133 145 161Canada 28 28 30 31United States 51 63 57 54Russian Federation 18 14 15 16World trade 265 259 272 286

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Source: BREE.

Metallurgical coal imports

In 2012, China’s metallurgical coal imports are forecast to increase by 28 per cent to 49 million tonnes. In 2013, China’s imports are forecast to increase by a further 19 per cent to total 58 million tonnes.

India is forecast to be the other major contributor to higher world metallurgical coal import demand in 2012. India’s imports are forecast to increase by 16 per cent in both 2012 and 2013 and to total 26 million tonnes in 2013.

Imports by the EU are forecast to remain unchanged in 2012 and 2013, compared with 2011, at around 46 million tonnes. The limited growth in 2012 and 2013 is consistent with unchanged steel production forecast for these years.

Metallurgical coal exports

In 2012, Australia’s exports of metallurgical coal are forecast to increase by 9 per cent to 145 million tonnes. In 2013, increased production from BMA owned mines in Queensland are forecast to underpin an 11 per cent increase in metallurgical coal exports, to 161 million tonnes. There is also expected to be increased production from a number of mines that are scheduled to start up in 2013, such as Peabody Energy’s Burton mine and at Anglo Coal’s Grosvenor underground mines.

Australia’s bulk commodity exportsIn 2012–13, Australia’s export volumes of iron ore are forecast to increase by 9 per cent, relative to 2011–12, to total 512 million tonnes. Despite the substantial increase in export volumes, export values of iron ore in 2012–13 are forecast to decrease to $54.6 billion (see Figure 3). The marked decline is a result of a forecast moderation of iron ore prices from the historically high levels of 2011–12. Although export values are forecast to decline in 2012–13, increasing export volumes of iron ore are expected to support export values over the medium term.

Figure 3: Australia’s iron ore exports


In 2012–13, Australia’s exports of metallurgical coal are forecast to increase by 8 per cent to 154 million tonnes. Despite high export volumes, earnings are forecast to decline by 24 per cent to $23.2 billion as a result of forecast lower contract prices in 2012–13 (see Figure 4).

Figure 4: Australia’s metallurgical coal exports


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Table 4: Steel and steel-making raw materials outlook2011 2012 f 2013 f % change

WorldContract prices bIron ore c US$/t 153 128 106 –17.3Metallurgical coal d US$/t 289 210 175 –16.5

2010–11 2011–12 2012–13 f % changeAustraliaProductionIron and steel e s Mt 7.31 5.36 4.82 –10.1Iron ore Mt 447 504 529 5.1Metallurgical coal Mt 147 147 162 10.4ExportsIron and steel e s Mt 1.78 1.19 1.04 –12.6– value A$m 1303 983 872 –11.3Iron ore Mt 407 470 512 8.8– value A$m 58387 62703 54638 –12.9Metallurgical coal Mt 140 142 154 8.5– value A$m 29793 30708 23790 –22.5

b fob Australian basis, BREE Australia–Japan average contract price assessment. c Fines contract, 62% iron content basis. d High–quality hard coking coal. For example, Goonyella export coal. e Includes all steel items in ABS, Australian Harmonized Export Commodity Classification, chapter 72, ‘Iron and steel’, excluding ferrous waste and scrap and ferroalloys. f BREE forecast. s BREE estimate.Sources: BREE; ABARES; International Iron and Steel Institute; Coal Services Australia; Queensland Coal Board; United Nations Conference on Trade and Development.

25

GoldAdam Bialowas

Gold pricesThe price of gold rose sharply in the second half of the September quarter 2012 in response to monetary policy announcements from the United States, the euro zone and Japan. The price of gold averaged US$1654 an ounce for the September quarter, an increase of 3 per cent relative to the June quarter. For 2012 as a whole, the average annual price of gold is forecast to increase 6 per cent to US$1670 an ounce. The gold price is forecast to increase by a further 4 per cent in 2013 to average around US$1740 an ounce, supported by increased fabrication demand for gold.

Figure 1: Quarterly gold prices


Fabrication demandFabrication consumption comprises the use of gold in jewellery, electronics, dental applications, medals, coins and other industrial uses. In 2012, fabrication demand for gold is forecast to decline 4 per cent relative to 2011 to 2647 tonnes. In India, the world’s largest consumer of jewellery, demand is expected to decline by 8 per cent in 2012 to 551 tonnes due to a national strike amongst jewellers, increased import duties and high domestic prices. In 2013, improvements in world economic conditions are expected to support an increase in fabrication demand, particularly in China and India, of about 3 per cent to 2715 tonnes.

Official sector purchasesIn 2012, the official sector is expected to purchase a record 475 tonnes of gold as a number of central banks continue to adjust the ratio of gold held in their portfolios relative to traditional reserve currencies such as the US dollar and the euro. In the first three quarters of 2012, the central banks of the Russian Federation (52 tonnes) and the Republic of Korea (51 tonnes) have both significantly added to their gold holdings. The official sector is expected to remain a substantial source of demand in 2013 purchasing 450 tonnes of gold.

Gold mine productionGold mine production in 2012 is expected to increase by less than 1 per cent relative to 2011 to 2820 tonnes. Initial production rates at some new mines have been lower than expected in 2012 and declining ore grades and industrial action, such as wage disputes at AngloGold Ashanti’s South African operations, have limited production growth. The main contributors to additional production are Perseus Mining’s Edican mine (8 tonnes annual production) and Rand Gold’s Gounkoto operation (7 tonnes annual production) in Mali.

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In 2013 world gold mine production is expected to increase by 3 per cent relative to 2012 to total 2906 tonnes. China is expected to increase output by 5 per cent in 2013 to total 413 tonnes as the high price of gold continues to make small scale artisanal mining economically viable. Strong growth is also expected to come from Indonesia where the country’s largest gold producers, Freeport McMorans’s Grasberg mine and Newmont’s Batu Haiju, following the resolution of industrial disputes.

Scrap salesIn 2012 the supply of gold from recycled sources is forecast to remain at a similar level to 2011 at 1650 tonnes. In 2013 the quantity of gold sourced from scrap is forecast to decline by 2 per cent to 1625 tonnes as improved economic conditions in many economies is expected reduce the requirement for holders of gold to liquidate their holdings.

Australia’s gold production and exportsAfter declining in 2011–12 Australian gold production is forecast to increase by 1 per cent in 2012–13 to 256 tonnes. New production is expected to come from Regis Resources Garden Wells mine (6 tonnes annual production), Crocodile Gold’s Cosmo Deeps mine (3 tonnes annual production), Millennium Gold’s Nullagine mine (2 tonnes annual production) and Kentor Gold’s Murchison Project (1 tonne annual production). This will be offset by a number of mines that will be reducing down production in 2012–13 including St Barbara’s Southern Cross, Rand Mining’s Raleigh, Ramelius Resources Wattle Dam and Polymetals White Dam

Australian exports of refined gold are produced from ore from domestic mine production as well as imports of gold dore (impure gold) and scrap which are imported and then refined into gold bullion and re-exported. In 2012–13, the volume of Australian exports of refined gold is expected to decline by 2 per cent, relative to 2011–12, to 297 tonnes. A decline in gold sourced from overseas is expected to offset the forecast increase in domestic mine production. The value of gold exports in 2012–13 is forecast to increase by 5 per cent to $16.3 billion supported by a higher gold price.

Figure 2: Australia’s gold exports


Table 1: Gold outlook2011 2012 f 2013 f % change

WorldFabrication consumption t 2759 2647 2715 2.6Mine production t 2818 2820 2906 3.0– China t 371 393 413 5.1– Australia t 258 249 272 9.2– United States t 233 231 235 1.7– Russian Federation t 212 210 215 2.4– South Africa t 198 190 185 –2.6Scrap sales t 1661 1650 1625 –1.5

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2011 2012 f 2013 f % changeNet stock sales t (1720) (1823) (1816) –0.4– official sector t (455) (475) (450) –5.3– private sector t (1271) (1338) (1356) 1.3– producer hedging t 6 (10) (10) 0.0Price b US$/oz 1569 1670 1738 4.0

2010–11 2011–12 2012–13 f % changeAustraliaMine production t 265 253 256 1.2Exports t 301 304 297 –2.3– value A$m 13016 15462 16291 5.4Price A$/oz 1389 1621 1680 3.6

b London Bullion Market Association AM price. f BREE forecast.Note: Net purchasing and dehedging shown in brackets.Sources: BREE; ABARES; Gold Fields Mineral Services; Australian Bureau of Statistics; London Bullion Market Association.

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AluminiumJohn Barber

Aluminium prices and stocksIn the September quarter of 2012 the average aluminium price was US$1914 a tonne, down 3 per cent from the previous quarter. Aluminium prices have been slightly higher so far in the December quarter and are expected to average around $1985 a tonne.

For 2012 as a whole, aluminium prices are forecast to decrease 16 per cent, relative to 2011, to average around US$2014 a tonne. Lower than expected economic growth in key aluminium consuming countries has constrained growth in aluminium consumption and kept prices lower than previous years. Aluminium production is expected to again exceed consumption and result in an increase in stocks. Aluminium stocks in 2012 are forecast to increase 12 cent, compared with 2011, to approximately 9 weeks of consumption.

In 2013, improving economic conditions in North America and continued economic growth in China and India are expected to support higher aluminium consumption and prices. The average aluminium price is forecast to increase 5 per cent, relative to 2012, to around US$2118 a tonne. Aluminium stocks are forecast to decrease by 20 per cent in 2013, compared to 2012, to around 7 weeks of consumption.

Figure 1: Annual aluminium prices and stocks


World aluminium consumptionConsumption of aluminium is forecast to increase 5 per cent year-on-year to 44.4 million tonnes in 2012. Robust growth in China (11 per cent), the US (13 per cent) and India (7 per cent) is expected to offset decreased consumption in Europe (down 6 per cent).

In 2013, growth in the construction and transportation manufacturing sectors is expected to support increased consumption of aluminium. World aluminium consumption is forecast to increase 6 per cent to total 47.3 million tonnes in 2013. China, India and the US will, again, be the principal contributors to this growth, their forecast consumption increasing by 12 per cent, 7 per cent and 3 per cent, respectively.

World aluminium productionIn 2012, world aluminium production is estimated to increase 2 per cent, relative to 2011, to total 45.3 million tonnes. The announced closures of several aluminium refineries in Europe have been partially offset by increased production in Asia and the US.

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Aluminium production in China is expected to increase to 19.5 million tonnes in 2012, 8 per cent higher than in 2011. In the US, production is forecast to grow 5 per cent year-on-year to total 2.1 million tonnes in 2012. By contrast, production in many European countries is forecast to decrease including Italy (down 58 per cent), the Netherlands (down 74 per cent) and the UK (down 60 per cent).

In 2013, growth in production is expected to again be limited by production curtailments that have been announced by producers in OECD countries. These have been in response to high stock levels developing in 2012, low prices and rising input cost pressures, particularly higher energy costs. Growth in production is forecast at 0.8 per cent in 2013, to total 45.7 million tonnes.

Production growth in 2013 is expected to be supported by higher production in China, the US and India. China’s aluminium production is forecast to increase 5 per cent to total 20.5 million tonnes, underpinned by assumed improvements in world economic conditions. In India, aluminium production is forecast to increase to 1.9 million tonnes in 2013, 13 per cent higher than 2012. Production in the US is forecast to total 2.1 million tonnes, growing by 2 per cent from the previous year.

Australia’s aluminium production and exportsAustralia’s aluminium production in 2012–13 is forecast to decline by 8 per cent, relative to 2011–12, to total 1.8 million tonnes. The closure of Norsk Hydro’s Kurri Kurri smelter in New South Wales is the main cause of the decrease and there is a risk of further curtailments in the short to medium term due to rising input costs.

In 2012–13, the volume of aluminium exported from Australia is expected to decrease in response to lower production. Exports are forecast to decrease 7 per cent, relative to 2011–12, to total 1.6 million tonnes. The value of Australia’s aluminium exports is forecast to decrease 16 per cent to $3.2 billion due to the combination of lower aluminium prices in 2012–13 and lower export volumes.

Figure 2: Australia’s aluminium exports


Alumina

PricesThe spot price of alumina in the September quarter averaged around US$316 a tonne, a 0.4 per cent decrease on the previous quarter. For 2012 as a whole, the spot price of alumina is forecast to decrease by 15 per cent, relative to 2011, to around US$319 a tonne. In response to low growth in world aluminium production in 2013, alumina prices are forecast to remain at around US$319 a tonne.

Australia’s alumina production and exportsIn 2012–13, Australia’s alumina production is forecast to increase, underpinned by additional output from the recently completed Yarwun refinery expansion. Alumina

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production in Australia in 2012–13 is forecast to increase 13 per cent, relative to 2011–12, to total 21.9 million tonnes.

As a result of production curtailments at aluminium smelters, the majority of the forecast increase in Australia’s alumina production is expected to be exported. In 2012–13, Australia’s alumina exports are forecast to increase 12 per cent, relative to 2011–12, to total 18.6 million tonnes. Alumina export earnings are forecast to increase by 18 per cent in 2012–13, relative to 2011–12, to total $6 billion.

Table 1: Aluminium and alumina outlook2011 2012 f 2013 f % change

World aluminiumProduction kt 44645 45294 45658 0.8– Australia kt 1945 1860 1696 –8.8– Canada kt 2983 2720 2802 3.0– China kt 18062 19534 20472 4.8– Russian Federation

kt 3992 4018 4100 2.0

– United States kt 1983 2083 2134 2.4Consumption kt 42398 44433 47260 6.4– China kt 17629 19647 21983 11.9– Germany kt 2103 2130 2098 –1.5– India kt 1584 1702 1816 6.7– Japan kt 1946 2012 2061 2.4– United States kt 4060 4594 4708 2.5Closing stocks b kt 6999 7860 6257 –20.4– weeks consumption 8.6 9.2 6.9 –25.0

Price c US$/t 2402 2014 2118 5.2USc/lb 109 91 96 5.3

World aluminaSpot price US$/t 374 319 319 0.0

2010–11 2011–12 2012–13 f % changeAustraliaProductionBauxite Mt 69 73 76 3.7Alumina kt 19041 19344 21857 13.0Aluminium kt 1938 1937 1786 –7.8ExportsAlumina kt 16227 16592 18578 12.0– value A$m 5218 5146 6049 17.5Aluminium kt 1686 1693 1576 –6.9– value A$m 4178 3797 3195 –15.9

b Producer and LME stocks. c LME cash prices for primary aluminium. f BREE forecast.Sources: BREE; ABARES; London Metal Exchange; World Bureau of Metal Statistics.

31

CopperAdam Bialowas

Copper prices and stocksThe price of copper was 2 per cent lower in the September quarter 2012, relative to the previous quarter, averaging US$7717 a tonne. The decline in price is due to ongoing concerns that lower economic growth rates in Europe may negatively impact upon demand for copper. In the December quarter 2012, copper prices have been supported by a series of announcements by central banks in the US, Europe and Japan and are forecast to increase marginally relative to the September quarter to average US$7840. Over 2012 as a whole, the copper price is forecast to fall 10 per cent relative to its historically high levels in 2011 to average around US$7930 a tonne.

From 2013, increases in production are expected to outpace increases in demand leading to an accumulation of global copper stocks. Starting from a low base, world copper stocks are expected to increase by 70 per cent in 2013 to total 1.1 million tonnes, equivalent to 2.7 weeks of production. This market surplus for copper is expected to place further downward pressure on the price of copper which is forecast to decrease 3 per cent to average around US$7680 a tonne in 2013.

Figure 1: Annual copper prices and stocks


World copper consumptionGlobal consumption of copper is forecast to increase 5 per cent in 2012, relative to 2011, to total 20.4 million tonnes. China is expected to be the main source of growth in copper consumption in 2012. Despite lower economic growth rates in 2012, Chinese consumption of refined copper is forecast to increase by 8 per, relative to 2011, to total 8.6 million tonnes. In developed economies, the US (up 2 per cent to 1.8 million tonnes) and South Korea (up 6 per cent to 792 000 tonnes) are both expected to contribute to higher world copper consumption in 2012. By contrast, economic conditions in Europe have led to refined copper consumption demand decreasing 6 per cent in 2012, to total 3.8 million tonnes.

In 2013, global consumption of copper is forecast to grow 2 per cent to total 20.9 million tonnes. In China, growth in demand for refined copper is expected to moderate due to reduced export demand for copper intensive products from Europe, its major export market, and a rundown of copper stocks which have accumulated in 2012. In 2013 consumption of refined copper in China is forecast to increase by 5 per cent to total 9 million tonnes.

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World copper mine productionIn 2012 world copper mine production is forecast to increase 2 per cent, relative to 2011, to total 16.6 million tonnes. After a decrease in production in 2011 due to a series of labour disputes, extreme weather and declining ore grades, Chile, the world’s largest copper producer, is forecast to increase mine production 2 per cent in 2012 to total 5.4 million tonnes. In 2012, there has been substantially higher production at existing Chilean copper mines such as BHP Billiton’s Escondida and Anglo American’s Los Bronces mine. Elsewhere in Latin America, new copper mines that commenced production in 2012 include Vale SA’s Salobo Mine in Brazil (100 000 tonnes annual production) and Xstrata’s Antapaccay Mine (140 000 tonnes annual production) in Peru.

Mine production in 2013 is forecast to increase by a further 6 per cent to total 17.6 million tonnes. Asian copper mine production is forecast to increase due to the commissioning of Turquoise Hill’s Oyo Tolgoi mine in Mongolia and the mining of higher ore grades at Freeport McMoran’s Grasberg mine in Indonesia. In Africa, Zambian mine production is expected to increase due to Vedanta’s Konkola and Nchanga mines continuing to ramp up to full production.

World refined productionRefined copper production in 2012 is forecast to total 20.1 million tonnes, 2 per cent higher than the total produced in 2011. China, the world’s largest producer of refined copper, continued to expand is refining capacity and is forecast to increase its output of refined copper by 8 per cent in 2012, relative to 2011, to produce 5.6 million tonnes. Japan’s production of refined copper is also forecast to grow in 2012 due to its domestic industry recovering from the effects of the 2011 tsunami. In 2013, increased availability of copper concentrates is expected to support higher global production of refined copper. Production is forecast to increase 6 per cent to 21.3 million tonnes.

Australia’s copper production and exportsIn 2012–13 Australian copper mine production is forecast to increase 13 per cent to 1 million tonnes. This increase is due to new production from Sandfire Resources DeGrussa mine (70 000 tonnes annual capacity), the ramp up of Newcrest’s Cadia East underground mine (annual capacity 80 000 tonnes) and Ivanhoe Australia’s Osborne mine (annual capacity 21 000 tonnes per annum). Australia’s production of refined copper in 2012–13 is expected to decline by 2 per cent, relative to 2011–12, to 476 000 tonnes. This reduction is due to a planned outage at BHP Billiton’s Olympic Dam smelter in the second half of 2012.

Australian exports of copper in 2012–13, in metallic content terms, are forecast to increase 3 per cent, relative to 2011-12, to total 911 000 tonnes. However, Australian export earnings from copper are expected to decline by 1 per cent to total $8.5 billion in 2012–13, in response to a lower Australian dollar price for copper.

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Figure 2: Australia’s copper exports


Table 1: Copper outlook2011 2012 f 2013 f % change

WorldMine production kt 16242 16620 17610 6.0– Chile kt 5263 5373 5481 2.0– China kt 1267 1540 1642 6.6– Peru kt 1235 1263 1321 4.6– United States kt 1138 1119 1281 14.5– Australia kt 959 925 1149 24.2– Zambia kt 784 847 1010 19.2Refined production kt 19791 20096 21291 5.9Consumption kt 19472 20443 20851 2.0– China kt 7915 8571 9034 5.4– United States kt 1756 1790 1861 4.0– Germany kt 1251 1144 1171 2.4– Japan kt 1007 970 995 2.6– Korea, Rep. of kt 747 792 786 –0.8– Russian Federation

kt 676 676 701 3.7

Closing stocks kt 985 628 1068 70.1– weeks consumption 2.6 1.6 2.7 68.8

Price US$/t 8852 7934 7675 –3.3USc/lb 401.5 359.9 348.1 –3.3

2010–11 2011–12 f 2012–13 f % changeAustraliaMine output kt 958 925 1042 12.6Refined output kt 485 486 476 –2.1Exports– ores and concentrates b

kt 1750 1814 2094 15.4

– refined kt 375 395 346 –12.4– total value A$m 8422 8489 8464 –0.3

b Quantities refer to gross weight of all ores and concentrates. f BREE forecast.Sources: BREE; ABARES; Australian Bureau of Statistics; International Copper Study Group; World Bureau of Metal Statistics.

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NickelTom Shael

Nickel prices and stocksThe average London Metal Exchange (LME) price for nickel in the September quarter 2012 was 5 per cent lower relative to the June quarter. The decrease in price to US$16 317 a tonne was associated with concerns over the prospects for world economic growth, particularly slowing growth in the Chinese economy. The average price for the December quarter 2012 is forecast to increase marginally to around US$16 600 a tonne.

For 2012 as a whole, nickel prices are forecast to average around US$17 400 a tonne. Compared with the average price for 2011, this represents a year-on-year decrease of around 25 per cent. Additional supply from new greenfield projects combined with moderating consumption growth is forecast to result in a 25 per cent year-on-year increase in stocks to around 217 000 tonnes. This increase in stocks is expected to be a leading contributor to the decrease in prices. The average nickel price in 2013 is forecast to remain unchanged at around US$17 300 a tonne.

Figure 1: Annual nickel prices and stocks


World nickel consumptionIn 2012 world consumption of refined nickel is forecast to increase by 3 per cent, compared with 2011, to total 1.63 million tonnes. Supporting higher world consumption will be growth in China’s nickel consumption of 7 per cent to total 730 000 tonnes. Growth in India (up 15 per cent from 2011 to total 40 000 tonnes) and the US (up 3 per cent to total 136 000 tonnes) will also contribute to higher world nickel consumption.

In 2013 nickel consumption is forecast to grow by 4 per cent, to total 1.70 million tonnes. This will be supported by robust growth in the Republic of Korea (up 6 per cent from 2012 to total 86 000 tonnes) and modest growth in China (up 1 per cent to total 740 000 tonnes). Higher world consumption in 2013 is also expected to be underpinned by higher consumption in the European Union (up 8 per cent to total 361 000 tonnes) in line with an assumed rebound in economic growth.

World nickel mine productionIn 2012 world nickel mine production is forecast to increase to 1.96 million tonnes, 3 per cent higher than in 2011. This growth will be driven primarily by the continued expansion to capacity of recently commissioned projects in Brazil (up 21 per cent from 2011 to total 110 000 tonnes) and Finland (up 39 per cent to total 50 000 tonnes).

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Nickel mine production in 2013 is forecast to increase by a further 3 per cent to total 2.01 million tonnes. The increase in mine production in 2013 will be supported by the start-up of Xstrata’s Koniambo mine (60 000 tonnes) in New Caledonia and Sherritt International’s joint venture Ambatovy mine in Madagascar (annual capacity of 60 000 tonnes).

World nickel refined productionRefined nickel production in 2012 is forecast to increase by 5 per cent, relative to 2011, to total 1.68 million tonnes. A substantial increase in Australia’s production of 20 000 tonnes (up 18 per cent) and a 13 000 tonne increase (up 9 per cent) in Canada’s production are expected to be the most significant additions to world refined nickel production in 2012. The increase in Australia’s production is largely due to expected higher production of class I nickel at BHP Billiton’s Nickel West Kwinana refinery, where production in 2011 was lower due a shortage of nitrogen gas, a key input in nickel processing.

In 2013 world production of refined nickel is forecast to increase by 2 per cent, relative to 2012, to total 1.71 million tonnes. Higher production in 2013 will be supported by a forecast increase in mine production from new operations in Madagascar and New Caledonia. Growth in China’s nickel pig iron production in 2013 is expected to decline in line with forecast lower world nickel prices and an assumed moderation in economic growth.

Australia’s nickel production and exportsNickel mine production in Australia in 2012–13 is forecast to decline by 6 per cent relative to 2011–12 to total 222 000 tonnes. The decrease is forecast a result of production continuing to be scaled-back in response to lower nickel prices.

Australia’s refined nickel production is forecast to increase by 7 per cent in 2012–13, relative to 2011–12, to total 131 000 tonnes. The increase is forecast to be largely a result of higher class I production.

Australia’s export volumes of nickel in 2012–13 are forecast to remain unchanged at around 240 000 tonnes. Export earnings in 2012–13, however, are forecast to decrease by 17 per cent to $3.4 billion due to a forecast decline in the Australian dollar price for nickel.

Figure 2: Australia’s nickel exports


Table 1: Nickel outlook2011 2012 f 2013 f % change

WorldMine Production kt 1902 1969 2012 2.2– Australia kt 215 239 211 –11.7– Brazil kt 91 110 120 9.1– Canada kt 220 201 205 2.0

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2011 2012 f 2013 f % change– Indonesia kt 297 310 310 0.0– Philippines kt 245 270 280 3.7– Russian Federation kt 270 270 270 0.0

Refined Production kt 1598 1680 1711 1.8– Australia kt 110 131 129 –1.5– Canada kt 142 155 155 0.0– China kt 411 445 430 –3.4– Japan kt 157 166 170 2.4– Russian Federation kt 266 257 257 0.0

Consumption kt 1584 1634 1702 4.2– China kt 680 730 740 1.4– European Union 27 kt 366 366 395 7.9

– India kt 35 40 42 5.0– Japan kt 152 140 150 7.1– Korea, Rep. of kt 79 81 86 6.2– United States kt 132 136 138 1.5Closing stocks kt 172 217 231 6.5– weeks consumption 5.7 6.9 7.1 2.9

Price US$/t 22854 17466 17325 –0.8USc/lb 1037 792 786 –0.8

2010–11 2011–12 2012–13 f % changeAustraliaProduction– mine bs kt 195 236 222 –5.9– refined kt 101 122 131 7.4– intermediate kt 60 70 49 –30.0Exports cs kt 210 240 238 –0.8– value A$m 4096 4063 3386 –16.7

b Nickel content of domestic mine production. c Includes metal content of ores and concentrates, intermediate products and nickel metal. f BREE forecast. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics; International Nickel Study Group; London Metal Exchange; World Bureau of Metal Statistics.

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ZincAdam Bialowas

Zinc prices and stocksThe price for zinc in the September quarter 2012 averaged US$1885 a tonne, a fall of 2 per cent relative to the June 2012 quarter. Prices have been affected by ongoing concerns about the prospects for economic growth within the euro zone and a slowing of the Chinese economy. In the December quarter of 2012 the price of zinc is expected to average around US$1900 a tonne, 1 per cent higher than in the September 2012 quarter.

The price of zinc is forecast to average US$1935 a tonne for the year 2012, down 12 per cent relative to 2011 due to lower consumption demand in OECD countries. This has resulted in stocks of zinc increasing from 7 weeks of consumption in 2011 to around 9 weeks of consumption in 2012. In 2013, zinc prices are forecast to increase 5 per cent to an average of US$2025 a tonne, underpinned by growth in emerging economies.

Figure 1: Zinc prices and stocks


World zinc consumptionIn 2012, world zinc consumption is forecast to decline by less than 1 per cent relative to 2011 to total 12.7 million tonnes. European countries, particularly OECD economies, have been the main driver of this decrease. European demand for zinc in 2012 is forecast to decline 5 per cent relative to 2011 to total 2.4 million tonnes due to ongoing sovereign debt issues and austerity measures limiting demand growth. In China, which accounts for over 40 per cent of global zinc consumption, a slowdown in economic growth in 2012 has led to zinc consumption increasing by less than 1 per cent in 2012 to total 5.5 million tonnes relative to 2011.

World zinc consumption is expected to return to growth in 2013, with demand forecast to increase by 4 per cent relative to 2012 to total 13.2 million tonnes. China is expected to generate the majority of this growth. Announced spending on infrastructure projects and higher demand for consumer goods are expected to support a 6 per cent increase in zinc consumption, relative to 2012, to total 5.8 million tonnes.

World zinc mine productionGlobal zinc mine production in 2012 is forecast to increase by 5 per cent relative to 2011 to total 13.6 million tonnes. China is expected to be the main contributor to this increase with production forecast to total 4.9 million tonnes in 2012, 14 per cent higher than 2011. Outside of China, increased production in 2012 has occurred as a result of commencement of production at the BHP Billiton, Teck and Mitsubishi’s

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joint venture Antamina mine in Peru (300 000 annual capacity) and the completion of the expansion to Hindustan Zinc’s Rampura Agucha mine in India (100 000 additional annual capacity).

In 2013, world zinc mine production is forecast to increase by a further 3 per cent relative to 2012 to total 14 million tonnes. In Africa, new production is due to occur from Glencore and Blackthorn Resources’ Perkoa (90 000 tonnes annual capacity) joint venture in Burkina Faso, the first base metal mine to be opened in that country. Zinc mine production will also be boosted by production from Xstrata’s recently commissioned Lady Loretta mine (140 000 tonnes annual production) in Australia as well as its Bracemac-McLeod mine (90 000 tonnes annual production) in Canada.

World refined zinc productionIn 2012, global refined zinc production is forecast to total 12.9 million tonnes, 2 per cent lower than 2011. This decrease is underpinned by a 5 per cent decline in production in China, the first reduction in the country’s zinc metal output for over 20 years. In 2013, refined zinc production is forecast to increase 5 per cent relative to 2012 to total 13.5 million tonnes, supported by ongoing expansion in China and the reopening of Glencore’s zinc plant at Porto Vesme in Italy and the La Oroya refinery in Peru.

Australia’s zinc production and exportsIn 2012–13 Australian zinc mine production is forecast to increase 1 per cent, relative to 2011–12, to total 1.6 million tonnes. The commencement of operations at Xstrata’s Lady Loretta mine (140 000 tonnes a year) in Mt Isa, Queensland will be a new source of production in Australia in 2013. This will be offset by closures at Bass Metal’s Hellyer mine in Tasmania, and all of Kagara Mining’s operations in 2012–13. Australian production of refined zinc in 2012–13 is forecast to total 525 000 tonnes, approaching Australia’s estimated total refining capacity of capacity of 540 000 tonnes.

Australian exports of zinc (total metallic content) in 2012–13 are forecast to decline 3 per cent, relative to 2011–12, to total 1.5 million tonnes. Coupled with a lower Australian price for zinc, Australian export earnings in 2012–13 are forecast to decline by 6 per cent relative to 2011–12 to total $2.2 billion.

Figure 2: Australian zinc exports


Table 1: Zinc outlook2011 2012 f 2013 f % change

WorldProduction – mine kt 12950 13596 13959 2.7Production – refined kt 13131 12862 13479 4.8Consumption kt 12753 12709 13186 3.8Closing stocks kt 1769 2081 1958 –5.9– weeks 7.2 8.5 7.7 –9.4

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2011 2012 f 2013 f % changeconsumptionPrice US$/t 2191 1935 2025 4.7

USc/lb 99 88 92 4.72010–11 2011–12 2012–13 f % change

AustraliaMine output kt 1479 1568 1584 1.0Refined output kt 499 505 525 4.0Exportsores and concentrates b

kt 2317 2405 2336 –2.9

– refined kt 410 456 453 –0.7– total metallic content

kt 1494 1583 1538 –2.8

– total value A$m 2373 2302 2161 –6.1

b Quantities refer to gross weight of all ores and concentrates. f BREE forecast.Sources: BREE; ABARES; Australian Bureau of Statistics; International Lead and Zinc Study group.

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Resourcesand Energy

QuarterlyReviews

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Overview of iron ore pricing and costsTom Shael and John barber

Iron ore is an important commodity for the Australian economy and represents approximately 28 per cent of the value of Australia’s minerals and energy exports. Despite its sizable global trade volume and importance, iron ore is mainly traded ‘over the counter’ through contracts negotiated between two parties. This is different to most other metals and commodities, which are traded through standardised delivery contracts at an exchange, such as the London Metals Exchange (LME). This generates a number of different types of prices and contracts and, unlike, exchange traded commodities there is no obligation to officially report prices.

Iron ore pricingThe ‘spot’ price, although often quoted, is not an official market price, rather it is an average created by collecting information from willing market participants. Given that there are different businesses, such as Platts and the Metal Bulletin, which conduct their own market surveys, there are also multiple iron ore spot prices. While these are broadly consistent with each other, differences can arise due to different sources.

The various agencies that collect and report spot prices generally provide their estimate of three different quoted prices—free on board (FOB), cost and freight (CFR) and cost, insurance and freight (CIF). The main difference between FOB and CFR prices is shipping costs. The FOB price can be seen as the price received by the seller for a shipment of iron ore leaving a port. The CFR price is the price paid at the port to where the iron ore shipment is delivered. A CIF price is the CFR price plus the extra cost of freight insurance.

In many cases there are common, or at least similar, CFR prices for a location such as the port of Tianjin in northern China. The FOB price associated with shipments to this port are, however, variable and depend on the location from where the shipment originated. For example, Australia’s Pilbara region is geographically closer to Tianjin than Brazil, making it cheaper to transport iron ore to China from the Pilbara than from a port in Brazil. As a result, the FOB price received by Australian suppliers is higher compared to Brazilian suppliers when the same CFR price is paid for shipments.

It is understood that the ‘benchmark’ spot price, often quoted by the Australian media, is a price for 62 per cent iron content ore, CFR North China. This is the price for iron ore delivery, including freight, to ports in North China regardless of the origin. By contrast, the prices and forecasts provided by BREE in the Resources and Energy Quarterly have been based on the quarterly contract price for 62 per cent iron content FOB Pilbara. Recently, the FOB Pilbara price has been between US$8 and US$10 a (wet) tonne less than the CFR North China price, however the The views expressed in this review are those of the authors alone and are not necessarily those of the Bureau of Resources and Energy Economics nor the Department of Resources, Energy and Tourism.

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differential has been lower at some stages of 2012 entirely due to lower shipping costs.

Iron ore contractingThe majority of Australia’s iron ore was previously sold on long-term supply contracts of 12 months in length, although some were several years in length. These contracts were re-negotiated each year and applied for the duration of the Japanese Fiscal Year (April to March). These types of contracts were most prevalent when Japan was the main export destination for Australia’s iron ore. The iron ore price for such a contract that was negotiated between key buyers and sellers was referred to as the benchmark price. The benchmark price was usually for 62 per cent iron content ore and quoted in US dollars.

Over the last ten years, iron ore market fundamentals have shifted. The demand for greater flexibility in supply contracts, which has coincided with China becoming Australia’s main destination for iron ore exports, has led to an increase in the use of shorter term contracts and the emergence of spot market trading. Contracting systems are now evolving further with one month contracts starting to emerge. This has occurred due to the increased variability in iron ore prices which, even over a three month period, can make one party to the contract subject to substantial price risk. For example, in the post-GFC period from late 2008 to 2011, the large increases in iron ore prices often put Australian suppliers in a worse off position if they were locked into a contract to supply iron ore at a cheaper rate than the market was willing to pay. By contrast, since mid-2011 the iron ore price has been declining on a downwards trend, to the benefit of Australian suppliers that had negotiated a contract price when spot prices were higher.

Although the iron ore market has evolved with increased spot trading and shorter contract lengths, it still lags behind other metal commodity markets in terms of complex securities trading, such as derivatives trading. Although iron ore swaps and futures contracts are now traded, they still remain a relatively small proportion of the total volume of iron ore traded.

Recent iron ore price issuesThe iron spot price, defined here as 62 per cent iron content, CFR Tianjin, reached a record high of US$192 a tonne in February 2011. In 2012, the budgeted decline in China’s GFC fiscal stimulus spending, coupled with slow economic recovery in Europe that has limited demand for China’s exports, has led to a moderation in the growth of China’s steel consumption. By contrast, monthly steel production figures in China have reached new record highs in 2012. Together, the high production and lower demand growth led to large stockpiles of surplus steel accumulating in China in the first half of 2012.

Given that many steel companies in China are state-owned and have performance targets linked to output, the incentive for some mills to cut production has been muted, at least until the most recent steel price reductions. Nevertheless, falling steel prices (see Figure 1) and an over-supply in the steel market led to China’s steel

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production to decline in August 2012, after reaching historic record levels in the preceding seven months.

Figure 1: China steel prices


The fall in steel prices over the last year has contributed to the decline in the price of iron ore in 2012. A number of measures of the iron ore spot price fell 50 per cent from their 2011 peaks to around US$90 a tonne (CFR) in September 2012. While price declines were forecast (see BREE’s September 2011 Resources and Energy Quarterly), the rapid price decreases since July 2012 exceeded the expectations of analysts.

On 1 July 2012, the 62 per cent iron ore spot price (CFR Tianjin) was around US$134 a tonne. By 6 September 2012 this price had dropped 35 per cent to US$87 a tonne in response to stocks of both steel and iron ore being wound down in China. As shown Figure 2, this is not the first occasion that the iron ore spot price has dropped rapidly in the recent past. In each of the last three years there has been a period (of about two to three months) in which the iron ore price fell sharply, often by 30 per cent or more. The issue for Australian iron ore suppliers is not that the price dropped sharply in the September quarter 2012, rather that prices have been on a downwards trend since March 2011.

Figure 2: Tianjin iron ore spot price (CFR)


As shown in Figure 2, iron ore spot prices reached their most recent ‘trough’ point at US$87 a tonne. Previously, many analysts believed that there was a ‘price floor’ of around US$120 a tonne for iron ore: the point where it was thought that China’s domestic producers would start to become unprofitable, based on costs of production. Some iron ore analysts are now reporting that the cost of production in China is indeed lower than thought previously and is now closer to US$90 a tonne due to cost cutting efforts in the latest period of declining prices. This view is consistent with the most recent price decline that did not result in the number of mine closures in China that would have been expected with an iron ore price below US$120 a tonne.

Outlook for the Australian iron ore industryMany Australian iron ore producers have implemented cost reduction programs in the past six months in response to lower iron ore prices. Australian iron ore miners, however, have started from a substantially lower cost base than miners in China. By contrast, even before the September quarter price drop most Australian producers were reporting operating costs within a range of $35 a tonne to $60 tonne. Rio Tinto is believed to be the lowest cost iron ore producer in Australia with a cash cost for

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the first half of 2012 of around $24.50 a tonne. While this initially indicates that many Australian suppliers should remain profitable at prices lower than the level experienced in the September quarter 2012, these costs only represent the average variable cost of producing a tonne of iron ore at a particular mine. There are substantial additional costs such as financing repayments, exploration expenditure, equipment replacement and maintenance, royalties, taxes and corporate overheads that need to be covered before a mining company can make a profit.

Nevertheless, most existing Australian producers, with a lower cost base and high resource grades, are expected to remain profitable in the long term, albeit with lower profit margins. These forecast lower profit margins are likely to result in continuing cost cutting activities.

Minerals and energy royalties in Australia

45

Roger Rose

Rights to mineral resources in Australia are publicly owned such that on shore and near shore resources are held by state and territory governments and those to off shore resources within the Australian Economic Zone are owned by the Australian government. While ownership of the resources is public, the inherently risky enterprise comprised of minerals exploration, mine development and operation are undertaken almost entirely by the private sector.

The resources and energy sector currently contributes around 10 per cent to Australia’s GDP and employs about a quarter of million workers directly. Resources and energy also make a large contribution to Australian government revenues through corporate income taxes. In addition, mining royalties and other specific mining or resource charges serve to provide a return to the broader community for depletion of publicly-owned resources. For some states, and for the Northern Territory, royalty revenues are a substantial component of government earnings.

A key question in designing and implementing mining and resource charges is how to raise revenue with the minimum imposition of costs on the sector and the smallest impact on future investment in the resources sector.

Types of royaltiesRoyalties are government charges that are imposed on either a volume or value basis on the amount extracted from publicly owned resources and, typically, are paid in addition to standard company or business taxes. Otto, Andrews, Cawood, Doggett, Guj, Stermole, Stermole, and Tilton (2006) provide a detailed international review of royalties while Guj (2008) gives a brief Australian perspective on minerals taxation.

The most commonly used royalty methods are as follows:

Specific royaltyA specific royalty is imposed as a fixed charge per unit volume or weight of production. Specific royalties are administratively simple, both for revenue agencies and miners.

Ad valorem royaltyAn ad valorem royalty is charged as a proportion of the value of production. Ad valorem royalties involve a higher level of administrative complexity than do specific royalties, both for revenue agencies and mines. The impact of an ad valorem royalty may depend on factors such the taxing point (mine head or when the ore is delivered on board a ship) or the pricing convention (market indicator price or miner’s realised price).

Profit (or net value) based royaltyA profit or net value based royalty is charged as a percentage of a given project or corporate profit. The views expressed in this review are those of the author alone and are not necessarily those of the Bureau of Resources and Energy Economics nor the Department of Resources, Energy and Tourism.

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Resource rent taxA resource rent tax is designed to provide government with a share of the resource rent—the surplus, if any, of revenue from a project over the total costs of exploration, development and operation. The challenge in designing a resource rent tax is to define the surplus (rent) so as to avoid taxing normal returns to capital in a risky venture. The Australian government imposes two resource rent taxes: the Petroleum Resource Rent Tax (PRRT) on off shore and on shore petroleum projects, and; the Minerals Resource Rent Tax (MRRT) for on-shore iron ore and coal minerals projects.

Production sharing arrangementsIn this arrangement a government will, typically, receive a share of project revenue, but does not make a capital or management contribution to a project. Internationally, production sharing arrangements, such as those in place in Indonesia, are common in the petroleum industry.

Royalty regimes in AustraliaAll Australian states and the Northern Territory, with the exception of the Australian Capital Territory, implement specific mining charges although there is considerable diversity in how these royalties are implemented. Most states have a two-tiered system of royalties. Typically, specific royalties are charged for a roughly consistent category of bulk products that includes quarry products and many, if not most, non-metallic bulk products. For base metals and precious metals an ad valorem royalty is the norm.

Iron ore and coal are Australia’s two largest bulk commodities, by trade value, and account for most of royalty revenue raised in Australia. For iron ore in Western Australia and coal in Queensland and New South Wales, ad valorem royalties apply. In all three cases the royalty rates are based on realised prices, but the structures and conditions differ in terms of how the royalties are collected.

Western Australian iron ore royalties are charged on the basis of realised values of ore produced and administered under a state agreement. The agreement binds both miners and the government and can only be varied by negotiation between the parties and consequent legislative change. Similar agreements exist for some other minerals of significance in Western Australia.

Royalties for coal in both Queensland and New South Wales are charged on an ad valorem basis. In both states the revenue base for the charge is realised revenue from sales. In Queensland the royalty rates, from 1 July 2012, are: 7 per cent up to $100/t; 12.5 per cent above $100/t and to $150/t, and $15 per cent above $150/t1. In New South Wales the rates are: 8.2 per cent for open cut; 7.2 per cent for underground, and 6.2 per cent for deep underground (deeper than 400m).

In Queensland, royalties for coal are charged on an essentially free on board basis rather than at the mine with no allowance made for the cost of transport and handling from the mine. Thus, as a percentage of net returns to a mining project, the

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royalty charge increases with the distance that the mine is from port. By contrast, Queensland royalties for petroleum products are charged on value at the wellhead. There are some other outliers in royalty arrangements, such as Victoria’s long-standing exemption of gold from royalty charges.

For base metals and precious metals, the most common royalty approach among Australian states is an ad valorem charge based on the invoice value with, typically, an allowance for transport costs to port or domestic market as deductions. In some cases, such as in Western Australia, royalty rates decrease with the degree of processing in order to provide an incentive for further processing. For some metals market reference prices, rather than invoice prices, are used to assess taxable value. For example, Queensland uses prices from the London Metal Exchange on the day of sale to charge royalties for some metals.

The Northern Territory government levies an 18 per cent profit tax on producers of minerals, except for uranium which is produced under Australian government regulations. The measure of taxable income is revenue, less operating costs, less a capital allowance. The capital allowance is equivalent to depreciation plus interest at the long term government bond rate plus 2 per cent.

Significance of royalty revenueIn 2010–11 state and territory governments raised $9207 million in revenue from royalties and other specific mining taxes. The sources and distribution of that revenue are given in Table 1. The bulk of royalty revenue accrues to the governments of Western Australia, Queensland and New South Wales from the iron ore and coal industries.

For Western Australia and Queensland mining royalties make up a significant part of total budget revenue, at 34 per cent and 12 per cent of own source revenue, respectively, in 2010–11. Similarly, revenue from the mining profit tax is important in the Northern Territory’s budget, contributing 27 per cent of own source revenue in 2010–11.

With rising commodity prices and a rapidly expanding mining sector in recent years royalty revenues have increased substantially over the decade. Nevertheless, while royalty revenues have increased in absolute value, and in real terms, they have declined relative to mining industry profits, at least until 2010–11. As a percentage of operating profit before tax royalty revenue fell from 24 per cent in 2002–03 to 11 per cent in 2010–112. In the past 18 months the states of Western Australia, Queensland and New South Wales have moved to increase royalty rates.

Table 1: State and territory royalty revenue 2010–11

NSW Qld SA Tas WA Vic NT ACT

Total separately identified

Coal 1 152 2357 na na na na 0 0 3 509Iron ore na na na na 3 359 na 0 0 3 359Other metals na 289 na na 424 na 146 0 859Petroleum na 52 na na 955 na 0 0 955

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NSW Qld SA Tas WA Vic NT ACT

Total separately identified

Total 1 240 2 698 157 36 4 872 58 146 0 9 207Percentage of own source budget revenue(a) 4 12 2 1 34 0 27 0 ..

Sources: State and territory budget papers, state departments of mines or primary industries, Commonwealth Grants Commission (2012), Changes in State Budgets 2001-02 to 2010-11, Information Paper, http://www.cgc.gov.au. Where possible, figures from primary state and territory sources are used in preference to those in Commonwealth Grants Commission.na: Not separately provided.(a) That part of total budget revenue not contributed through GST distribution or other Commonwealth grants processes.

Effects of royalties Royalties suffer an important drawback as an instrument for channelling some part of the benefit of the resources and energy sector to the broader community. This arises from the inflexibility of royalty systems to adjust to variation in profitability within the sector and, in the case of specific royalties, to variation in profitability over time. This distorts efficient investment because mining projects are diverse, in terms of output and both the structure and level of capital and operating costs and also because resource prices fluctuate with movements in world market conditions.

To understand the possible distortions associated with royalties consider two coal mines, A and B, with total unit production costs of $45/t and $75/t, respectively. Suppose that the price received, at the mine, of coal produced from both projects is initially $90/t. The unit net returns are, thus, $45/t and $15/t for projects A and B, respectively. The imposition of a 10 per cent ad valorem royalty reduces unit net returns to $36/t and $6/t for mines A and B. While the proportional reduction in unit net returns is much greater for mine B than for mine A—60 per cent compared to 20 per cent—both mines remain profitable after payment of the royalty.

Further suppose that the coal price falls to $80/t, with the previous 10 per cent royalty unchanged. Unit net returns are then $27/t and –$3/t for mines A and B, respectively. Mine B is no longer profitable. This simple case illustrates that, typically, royalty arrangements are not sufficiently responsive to differences in mine profitability or changes in market conditions. As a result, ad valorem or specific royalty charges can, and do, discourage investment in, or limit production from, at least some economically viable mining projects.

The ad valorem charge provided in the example above is the most common of state minerals and energy charges and is more flexible than a specific royalty. For instance, if instead of an ad valorem royalty a specific charge of $9/t were imposed, equivalent to the 10 per cent ad valorem charge, then the fall in coal price from $90/t to $80/t with a fixed royalty of $9/t, would reduce net returns to $26/t and –$4/t for mines A and B, respectively. By reducing net returns to mines royalties also have a negative effect on the incentive to explore for, develop and operate mines.

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http://www.cgc.gov.au/

Interaction between royalties and other chargesThe Australian government’s introduction of the Mineral Resource Rent Tax (MRRT) on 1 July 2012. The MRRT is structured to ensure that the owner of a project with an MRRT liability pays a total rate of tax on the tax measure of resource rent that is equal to the MRRT rate plus the corporate tax rate with an allowance for royalty payments.

Projects with a tax measure of resource rent less than $75 million in any year, are exempt from MRRT in that year such that the liability is graduated from zero at $75 million to the full tax rate at $125 million. As a result, mining projects which earn less than $75 million in all years are exempt from paying the MRRT, but must bear the full cost of any state royalty charges.

ReferencesGuj, P. 2008, Mineral Royalties and Other Mining Specific taxes, International Mining for Development Centre, www.im4dc.org

Otto, J., Andrews, C., Cawood, F., Doggett, M., Guj, P., Stermole, F., Stermole, J. and Tilton, J. 2006, Mining Royalties: A Global Study of Their Impact on Investors, Government, and Civil Society, The World Bank, http://siteresources.worldbank.org/INTOGMC/Resources/336099-1156955107170/miningroyaltiespublication.pdf.

The levelised cost of electricity in Australia

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Arif Syed

IntroductionLevelised costs are a convenient and frequently used technique for comparing the cost of different competing technologies, based on a common set of assumptions. The levelised cost of electricity (LCOE) provides a valuable tool for policy makers in understanding the main cost drivers of electricity generation costs today and future cost trends, and is used extensively in energy projections both internationally and in Australia.

This review highlights the salient feature of LCOE and its use in the Australian Energy Technology Assessment 2012 (AETA) released in July 2012. In the AETA, LCOE estimates were developed for 40 electricity generation technologies (renewable and non-renewable) and for different locations in Australia.

Background The LCOE is the minimum cost of energy at which a generator must sell the produced electricity in order to breakeven. It is equivalent to the long-run marginal cost of electricity at a given point in time because it measures the cost of producing one extra unit of electricity with a newly constructed electricity generation plant.

The calculation of LCOE requires a significant number of inputs and assumptions. Key factors used to calculate LCOE by technology typically include: an amortisation or pay-back period, discount rate, capacity factor, fuel cost, variable and fixed O&M (operations and maintenance) cost, and the capital cost.

The formula for calculating LCOE and its component parts is defined below (please refer to pages 59–60 of the Resources and Energy Quarterly – December quarter 2012 PDF version).

While many cost estimates have been conducted internationally, these studies are not directly applicable to Australian conditions due to differences in domestic costs (e.g. labour) and differences in the quality of domestic energy resources.

AETA 2012 reportThe Australian Energy Technology Assessment (AETA) 2012 was released by BREE on 31 July 2012. The AETA provides up-to-date LCOE estimates for 40 electricity generation technologies under Australian conditions, taking into consideration the impact of carbon pricing.

BREE engaged WorleyParsons to develop cost estimates for the electricity generation technologies examined in the AETA. The AETA cost estimates were developed with the active collaboration of the Australian Energy Market Operator (AEMO) that has also used some of the AETA cost estimates for its National Transmission Network Development Plan (NTNDP), and a large number of industry stakeholders. In addition, the Commonwealth Scientific and Industrial Research The views expressed in this review are those of the author alone and are not necessarily those of the Bureau of Resources and Energy Economics nor the Department of Resources, Energy and Tourism.

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Organisation (CSIRO) provided a modelling framework for projecting changes in technology costs over time.

The cost estimates, available for each of 40 technologies, were generated on a ‘bottom up’ basis that accounted for the component costs that determine overall long-run marginal cost of electricity generation from a utility-scale and an Nth kind plant. The methods used to build up the cost estimates were applied consistently across all technologies and all the key assumptions used to generate the costs are fully detailed in the report and/or the accompanying AETA model that is free to use and available by emailing [email protected].

To ensure that the cost estimates for the various technologies are consistent, all common input costs (e.g. labour, materials, components etc.) are itemised. In addition, a distinction is made between local and international equipment costs, as the latter costs are particularly sensitive to movements in Australian dollar’s exchange rate with other currencies.

The AETA was developed in close consultation with a project steering committee whose members were selected on the basis of their technical expertise and also a stakeholder reference group drawn from industry and research/academic organisations with interests and knowledge in a diverse range of electricity generation technologies. As part of the consultation process, stakeholders were invited to provide up-to-date estimates of electricity generation technology costs, and associated supporting evidence.

An integral component of the AETA that complements the AETA report is the AETA model that was developed to generate LCOE by state, by year and by technology. The AETA model allows users to change many of the principal model parameters such as the capacity factor, the carbon price and discount rate.

Key findings of the AETA 2012 include:

Estimated costs of solar photovoltaic technologies have dropped dramatically in the past two to three years.

Differences in the cost of generating electricity, especially between fossil fuel and renewable electricity generation technologies, are expected to diminish over time.

Biogas and biomass electricity generation technologies in 2012 are some of the most cost competitive forms of electricity generation and are projected to remain cost competitive out to 2050.

By 2030 some renewable technologies, such as solar photovoltaic and wind on-shore, are expected to have the lowest LCOE of all of the evaluated technologies.

Among the non-renewable technologies, combined cycle gas (and in later years combined with carbon capture and storage) and nuclear power, offer the lowest LCOE over most of the projection period and they both remain cost competitive with the lower cost renewable technologies out to 2050.

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For some technologies, LCOE is projected to increase over time. This is because of a projected weakening of the Australian-dollar exchange rate from its current historic highs that will increase the cost of imported power plant components in Australian dollar terms and also because of projected increases in labour costs in excess of the consumer price index. In addition, for fossil-fuel technologies that generate CO2 emissions, increased costs are projected from assumed increases in the carbon price out to 2050.

Technology Comparisons of LCOE: Key pointsA summary of the AETA results is provided in Figure 1. Where the technology in currently available, the black line represents the LCOE ($/Mwh) in 2012 while the bars represent the projected LCOE range in 2030. The red diamond is the estimated carbon emissions per Mwh for each of the technologies in 2030. It suggests that Australia’s electricity generation future is likely to be very different to the present.

Figure 1 compares LCOEs at 2030 with the 2012 LCOEs for each technology, for the State of New South Wales (NSW). Differences are explained by a multiplicity of factors including the technical developments, learning rates or cost reductions, carbon prices, exchange rate effects, and fuel prices. The inter-technology LCOE comparisons figures (see Figures 1 and 2) reveal changes in relative costs of technologies over time. Key results include:

Carbon capture and storage technologies become commercially available from 2030;

Between 2012 and 2020, except for biogas (land fill) and on-shore wind technologies, renewable technologies have higher LCOEs than the lowest cost non-renewable technologies;

The relative LCOE rankings significantly change post 2030. LCOEs of several renewable technologies become lower than the non-renewables, including CCS technologies, from mid-2030 onwards;

After 2040, several renewable and CCS-technologies such as solar PV, on-shore wind, bioenergy, and CCS retrofit technologies become lower cost than non-renewable fossil fuel technologies without CCS.

Figure 1: LCOE for Technologies (NSW), 2030 compared with 2012


Figure 2 provides a relative ranking of technology LCOEs in 2040 for NSW and projected low LCOEs for each technology. It illustrates how the LCOEs of various technologies rank against each other in 2040. The figure shows that by 2040 large-scale solar photovoltaics could be the lowest electricity generation technology at the plant level, based on current information.

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Figure 2: LCOE for Technologies (NSW), 2040


Caveats on the use of LCOE Notwithstanding the value of LCOE methodology as an analytical tool for comparing electricity generation options, the methodology has a number of limitations in assessing the actual market value of these technologies and the costs associated with integrating these technologies into an electricity network.

Technologies with an established track record during the phases of both construction and operation, and with relatively stable costs during their lifetime may be regarded as less ‘risky’. To the extent that a long term, stable income can be assured over a project’s life, risk is further reduced. By contrast, technologies with historical cost overruns, costly delays during construction, and fuel cost volatility generate additional risks, real or perceived. Higher perceived risks will in turn demand higher rates of return on investment. Typically, the discount rate can be used to account for some of these differences in risk with a higher discount rate applied to the ‘riskier’ projects. For ease of comparison, however, a common discount rate of 10 per cent is applied in AETA 2012 for all technologies.

Another issue which is not generally catered for in LCOE methodology are the costs associated with integrating generating technologies into an electricity network. Comparative assessments of various alternative technologies based on the LCOE methodology could, therefore, be enriched if they were complemented by a generalised consideration of network connection and other integration costs. In particular, LCOE analyses do not typically take into consideration differences between technologies in relation to transmission costs. Many of the most prospective energy resources (e.g. geothermal, wind, solar) can be located in regions remote from the existing grid or major sources of electricity demand. As a result, trade-offs may exist between generation versus transmission costs when deciding the best location for a power plant. For example, it is generally more cost effective to locate coal fired power plants adjacent to a coal mine rather than transport coal to power plants located near major demand centres.

Projected LCOE does not necessarily provide a reliable indicator of the relative market value of generation technologies because of differences in the role of technologies in a wholesale electricity market. The value of variable (or intermittent) power plants (such as wind, and solar) will depend upon the extent to which such plants generate electricity during peak periods and the impact these plants have on the reliability of the electricity system. Unlike dispatchable power plants (such as coal, natural gas, biomass, and hydroelectric)—which are reliant on some form of stored energy (e.g. fuels, water storage)—wind and photovoltaic power plants do not, typically, include energy storage.

To cater for sudden, unpredictable, changes in the output of variable power plants, it is necessary to operate responsive, dispatchable power plants (e.g. hydro, open-

54

cycle gas turbines) in a back-up role to maintain the overall reliability of the electricity system. As a result, LCOE by technology is not the only factor considered when deciding what type of electricity generation plant to construct.

Way forwardThe AETA model will be updated with the assistance of a stakeholder reference group for the current 40 technologies in the first half of 2013. In 2014, LCOEs will be developed that will allow for consideration of additional technologies and methodological improvements to the model.

GlossaryAmortisation Period: the period over which a plant must achieve its economic return.

Capacity Factor: the ratio of the actual output of a power plant over a period of time and its potential output if it had operated at full nameplate capacity the entire time.

Capital Cost: the cost of delivery of a plant, not including the cost of finance.

Discount Rate: the rate at which future values are discounted or converted to a present value.

First-of-a-Kind Plant cost: costs necessary to put a first commercial plant in place and that will not be incurred for subsequent plants. Design and certification costs are examples of such costs.

International Equipment Cost: the cost for internationally sourced equipment associated with the project.

Labour Cost: the component of the delivery cost for a plant associated with local (Australian) labour.

Levelised Cost of Energy: the minimum cost of energy at which a generator must sell the produced electricity in order to achieve its desired economic return.

Nth-of-a-kind plant cost: All engineering, equipment, construction, testing, tooling, project management, and other costs that are repetitive in nature and would be incurred if a plant identical to a FOAK plant were built. The NOAK plant is the nth-of-a-kind or equilibrium commercial plant of identical design to the FOAK plant.

Operations and maintenance costs: Fixed and variable costs incurred on direct and home office labour and associated support costs, fixed service provider costs, minor spares, fixed inspection, services, chemicals and operating consumables that are generation dependent and unplanned maintenance, etc.

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ReferencesBREE (Bureau of Resources and Energy Economics), 2012, Australian Energy Technology Assessment, Canberra, July. http://www.bree.gov.au/publications/aeta.html

Resourcesand Energy

Quarterly

56

Statistical tablesContribution to GDP

57


Principle markets for Australian imports in 2010–11 dollars


Principle markets for Australian exports in 2010–11 dollars


Resources and energy sector indicators, Australia


Principle markets for Australian resources and energy exports


Resources and energy prices, ended March Quarter 2012

Please refer to pages 113–114 of the Resources and Energy Quarterly – December quarter 2012 PDF version.

Table 1: Annual exports summary, Australia, Balance of payments basis2007–08 2008–09 2009–10 2010–11 2011–12 2012–13

fAt current prices $m $m $m $m $mMineral resources– Coal, coke and briquettes 24603 54954 36787 44101 48216 41715

– Other mineral fuels 18889 20706 18984 23594 25719 32023– Metalliferous ores and other minerals 41930 52725 54081 79814 85897 77443

– Gold 12272 17508 14300 14256 16650 17858– Other metals bs 18211 14358 14031 15963 14552 13385– Total s 115904 160251 138183 177729 191035 182423Total commodities sector s 145875 194168 168656 212095 228247 217721

Other merchandise s 37047 37447 33121 34884 36975 naTotal merchandise s 182922 231615 201777 246979 265222 naServices 50891 52283 51359 50343 50552 naTotal goods and services 233813 283898 253136 297322 315774 na

Chain volume measures cMineral resources– Coal, coke and briquettes 37311 39032 46390 44101 46023 49784

– Other mineral fuels 19196 20303 21997 23593 21414 27105

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2007–08 2008–09 2009–10 2010–11 2011–12 2012–13 f

– Metalliferous ores and other minerals 68059 67509 77745 79780 90301 74264

– Gold 18541 20618 16070 14256 14195 14570– Other metals bs 13907 14358 13668 14356 15216 14557– Total s 157014 161820 175870 176085 187150 180279Total commodities sector s 187727 195015 209200 210740 na na

Other merchandise s 34828 32038 34539 36239 na naTotal merchandise s 222555 227053 243739 246979 261624 naServices 54726 54430 52412 50344 49315 naTotal goods and services 277537 281596 296556 297322 310941 na

a Includes diamonds, which are not included in the balance of payments item by the ABS. b Includes BREE estimates for steel and nickel, which are retained as confidential by the ABS. c For a description of chain volume measures, see ABS, Introduction of chain volume measures, in the Australian National Accounts, cat. no. 5248.0, Canberra. Reference year is 2009–10. s BREE estimate. f BREE forecast. na Not available.Sources: BREE; ABARES; Australian Bureau of Statistics, Balance of Payments and International Investment Position, Australia, cat. no. 5302.0, Canberra.

Table 2: Unit export returnsAnnual indexes a 2006–

072007–08

2008–09

2009–10

2010–11

2011–12

2012–13 f

Metals and other minerals 201.5 199.8 225.8 210.3 281.2 270.9 239.3

Energy 206.6 235.8 398.3 258.9 319.1 343.8 305.4Total resources and energy 204.3 214.3 290.6 229.3 296.3 298.8 264.6

a In Australian dollars. Base: 1989–90 = 100. s BREE estimate. f BREE forecast.Sources: BREE; ABARES.

Table 3: Contribution to exports by sector, balance of payments basisPlease refer to page 96 of the Resources and Energy Quarterly – December quarter 2011 PDF version.

Table 4: Industry gross value added a bunit 2007–08 2008–09 2009–10 2010–11 2011–12

Agriculture, forestry and fishing $m 26 030 30 623 30 054 32 156 34 361Mining– mining (excludes services to mining) $m 111957 115515 125365 122548 130119

– exploration and mining support services $m 8073 8215 7974 8560 10170

– total $m 119661 123310 133015 131109 140287Manufacturing– food, beverage and tobacco product $m 23294 22556 24205 24085 22886

– textile, clothing and other manufacturing $m 10486 9386 7331 6855 6707

– wood and paper products $m 7486 6909 7191 7092 7000– printing and recorded media $m 5161 4319 4133 4125 3839– petroleum, coal, chemical, etc, $m 19190 17259 17903 17913 18036

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unit 2007–08 2008–09 2009–10 2010–11 2011–12product– non-metallic mineral products $m 5212 5172 5073 4971 4621– metal products $m 22965 22660 21296 22203 22354– machinery and equipment $m 20352 19579 20731 20566 21207– total $m 113034 107250 107760 107808 106651Construction $m 94316 98381 98639 103338 107864Electricity, gas, water and waste services $m 31036 32335 33200 33811 33357

Taxes less subsidies on products $m 92542 91632 91198 93524 93941Statistical discrepancy $m 0 0 –1 1 4462Gross domestic product $m 1320746 1342514 1370541 1403888 1452891

a Chain volume measures, reference year is 2009–10. b ANZSIC 2006.Source: Australian Bureau of Statistics, Australian National Accounts: National Income, Expenditure and Product, cat. no. 5206.0, Canberra.

Table 5: Volume of production indexes2007–08 2008–09 2009–10 2010–11 2011–12 2012–13 f

Mine aEnergy minerals 116.9 122.6 127.2 121.9 121.2 109.1Metals and other minerals 124.1 119.6 123.2 138.9 141.0 145.0

Total minerals 120.4 121.1 125.3 130.5 131.1 126.7

a Uranium is included with energy. s BREE estimate. f BREE forecast.Note: The indexes for the different groups of commodities are calculated on a chained weight basis using Fisher’s ideal index with a reference year of 1997–98 = 100.Sources: BREE; ABARES; Australian Bureau of Statistics.

Table 6: Employment a b2006–07

2007–08

2008–09

2009–10

2010–11

2011–12

’000 ’000 ’000 ’000 ’000 ’000Agriculture, forestry and fishing 352 355 362 369 351 335Mining– coal 27 26 35 41 48 55– oil and gas extraction 10 11 15 15 13 15– metal ore 46 47 49 52 69 82– other mining (including services) 53 62 72 66 75 96

– total 136 146 170 173 205 248Manufacturing– food, beverages and tobacco 215 230 226 228 229 228– textiles, clothing, footwear and leather 51 50 48 46 45 39

– wood and paper product 77 70 67 64 57 55– printing, publishing and recorded media 51 54 51 52 56 42

– petroleum, coal and chemical product 92 98 90 88 85 88

– non-metallic mineral product 36 42 40 37 37 38– metal product 161 159 157 147 147 146– other manufacturing 342 360 348 343 336 320– total 1025 1063 1028 1006 992 956Other industries 8876 9144 9332 9479 9806 9893

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2006–07

2007–08

2008–09

2009–10

2010–11

2011–12

Total 10388 10708 10892 11027 11355 11432

a Average employment over four quarters. b ANZSIC 2006. Caution should be used when using employment statistics at the ANZSIC subdivision and group levels due to estimates that may be subject to sampling variability and standard errors too high for most practical purposes.Source: Australian Bureau of Statistics, Labour Force, Australia, cat. no. 6291.0, Canberra.

Table 7: Business income2007–08 2008–09 2009–10 2010–11 2011–12

Company profits in selected industries a $m $m $m $m $m

Mining 40184 67402 49889 76563 69853Manufacturing– food, beverages and tobacco 5757 6166 8168 na 5609– textiles, clothing, footwear and leather 501 245 409 197 449

– wood and paper product 1184 667 615 719 542– printing, publishing and recorded media 620 170 439 na 461

– petroleum, coal and chemical product 6192 2159 3676 3164 2184

– non-metallic mineral product 1359 978 1155 1008 833– metal product 7924 3781 2662 2277 -750– machinery and equipment 1937 2695 3383 3657 1484– other manufacturing 851 637 712 na 452– total 26325 17498 21219 na 11264Other industries (including services) 100634 72005 97870 na 102289

Total (including services) 167143 156905 168978 199839 183406

a Company profits before income tax, based on ANZSIC 2006.Sources: BREE; Australian Bureau of Statistics, Australian National Accounts: National Income, Expenditure and Product, cat. no. 5206.0, Canberra; Australian Bureau of Statistics, Company Profits, Australia, cat. no. 5651.0, Canberra; Australian Bureau of Statistics, Business Indicators, Australia, cat. no. 5676.0, Canberra; Australian Bureau of Statistics, Australian Industry, cat. no. 8155.0, Canberra.

Table 8: All banks lending to business a2010–11 2011–12Sep Dec Mar Jun Sep Dec Mar Jun$b $b $b $b $b $b $b $b

Agriculture, fishing and forestryMining 58.5 58.5 58.2 60.2 60.3 60.1 60.4 62.4Manufacturing 11.6 11.4 11.2 12.4 13.5 14.3 15.3 17.0Construction 38.0 37.9 39.0 39.1 41.0 40.8 43.7 42.5Wholesale, retail trade, transport and storage 90.7 92.3 93.3 92.8 95.4 97.3 99.5 101.7

Finance and insurance 103.7 99.1 94.1 89.4 93.4 96.5 99.2 100.8Other 314.0 312.2 316.9 314.1 315.4 320.6 321.6 329.3Total 646.3 641.0 642.9 638.0 648.4 658.4 668.9 683.9

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a Includes variable and fixed interest rate loans outstanding plus bank bills outstanding.Source: Reserve Bank of Australia, Bank Lending to Business – Selected Statistics, Bulletin Statistical Table D8.

Table 9: Capital expenditure of private enterprises2007–08 2008–09 2009–10 2010–11 2011–12

At current prices $m $m $m $m $mGross fixed capital formation aAll sectors 336358 353116 357399 372434 410669New capital expenditureMining b 29201 37977 35185 46847 81997Manufacturingfood, beverages and tobacco 2596 2492 2566 2882 2721textiles, clothing, footwear and leather 112 118 140 70 115

wood and paper product 928 897 719 610 787printing, publishing and recorded media 396 450 452 187 257

petroleum, coal and chemical product 2126 2239 2207 2320 2802

non-metallic mineral product 474 609 731 806 795metal product 4137 4608 3689 4017 4323machinery and equipment 1110 1160 1112 1340 1366other manufacturing 164 108 126 111 60total 12340 12682 11743 12343 13227Total surveyed industries 96833 113201 107104 119341 154841Chain volume measures cGross fixed capital formation aAll sectors 344680 351928 358787 372435 411701New capital expenditureMining 30989 38013 35330 46846 81096Manufacturing 12637 12233 11423 12343 13371Other selected industries 53393 58787 58563 60151 60964Total surveyed industries 97266 109126 105507 119340 155430

a Estimates taken from ABS national accounts, which include taxation-based statistics. b ANZSIC 2006 Division B. c Reference year is 2009–10.Sources: BREE; ABARES; Australian Bureau of Statistics, Australian National Accounts: National Income, Expenditure and Product, cat. no. 5206.0, Canberra; Australian Bureau of Statistics, Private New Capital Expenditure and Expected Expenditure, Australia, cat. no. 5625.0, Canberra.

Table 10: Private mineral exploration expenditure2006–07 2007–08 2008–09 2009–10 2010–11 2011–12

At current prices $m $m $m $m $m $m

EnergyPetroleum– onshore 498.2 493.8 492.3 748.6 756.5 919.7– offshore 1727.3 2541.1 3318.4 2745.5 2558.9 2277.3total 2225.5 3034.9 3810.7 3494.1 3315.4 3197.0Coal 193.2 234.8 297.3 321.2 519.7 834.3Uranium 114.1 231.5 185.2 169.1 213.9 153.6Total 2532.8 3501.2 4293.2 3984.4 4049.0 4184.9Metals and other minerals

62

2006–07 2007–08 2008–09 2009–10 2010–11 2011–12aGold 455.9 592.6 438.0 575.4 652.2 768.0Iron ore 285.4 449.8 588.7 524.1 665.0 1150.6Base metals, silver and cobalt b 555.0 783.2 519.1 457.2 669.5 795.5

Mineral sands 37.3 37.0 30.6 na na naDiamonds 26.9 21.7 10.0 na na naOther 46.8 110.8 154.3 147.2 196.2 naTotal metals and other minerals a 1407.3 1995.1 1740.7 1742.3 2217.7 2965.1

Total expenditure 3940.1 5496.3 6033.9 5726.7 6266.7 7150.0

a Uranium is included with energy. b Base metals include copper, lead, nickel and zinc. s BREE estimate.Sources: BREE; Australian Bureau of Statistics, Mineral and Petroleum Exploration, Australia, cat. no. 8412.0, Canberra.

Table 11: Annual world indicator prices of selected commoditiesunit 2007–

082008–09

2009–10

2010–11

2011–12

2012–13 f

EnergyCrude oilDubai US$/bbl na na na 74.6 109.2 107.1West Texas Intermediate US$/bbl 96.8 70.3 75.2 89.3 94.3 87.9Brent dated US$/bbl 95.2 68.8 74.5 96.0 110.7 107.1Uranium (U3O8) a US$/lb 80.75 51.25 43.81 57.13 51.50 45.31Minerals and metals bAluminium US$/t 2667 1868 2016 2383 2166 2000Copper US$/t 7785 4919 6691 8671 8196 7742Gold d US$/oz 823 874 1092 1372 1672 1701Iron ore (negotiated) d USc/dmtu 80 145 97 180 230 176Lead US$/t 2904 1459 2093 2392 2127 2108Manganese (negotiated) e US$/mtu 540.9 1340.1 544.9 768.0 544.1 na

Nickel US$/t 28564 13322 19390 23963 19281 16785Silver USc/oz 1544 1289 1688 2880 3321 3407Tin US$/t 18529 13576 16202 23960 20011 naZinc US$/t 2606 1403 2066 2243 2018 1930

a World trade weighted average price compiled by the US Department of Energy. Official sales prices or estimated contract terms for major internationally traded crude oils. b Average of weekly restricted spot prices over the period, published by Ux Consulting. c Average LME spot price unless otherwise stated. d London gold fix, London Bullion Market Association. e Australian hematite fines to Japan (fob) for Japanese Fiscal Year commencing 1 April. BREE Australia–Japan average contract price assessment. g Japanese Fiscal Year commencing 1 April. s BREE estimate. f BREE forecast. na Not available.Sources: BREE; Australian Bureau of Statistics; International Energy Agency; ISTA Mielke and Co.; London Bullion Market Association; The London Metal Exchange Ltd; Reuters Ltd; Ux Consulting Company; Platts Oilgram; US Department of Energy; World Bureau of Metal Statistics.

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Table 12: World production, consumption and trade for selected commodities a

unit 2008 2009 2010 2011 2012 f 2013 fEnergyCrude oilProduction– world b mbd 86.5 85.6 87.2 88.3 90.2 91.4– OPEC c mbd 35.8 34.1 34.6 35.6 37.0 37.7Consumption b mbd 86.2 85.6 88.4 89.2 89.8 90.4CoalProductionhard coal d Mt 5752 5866 6218 6637 6443 nabrown coal Mt 965 913 930 935 954 naExports– metallurgical coal Mt 233 220 265 259 272 286– thermal coal Mt 704 723 797 866 899 934Uranium (U3O8)Production e s kt 53.5 53.3 55.2 55.4 58.1 60.2Consumption kt 76.2 77.2 79.8 73.8 75.1 81.7MetalsBauxite production kt 217469 193038 203460 242256 253646 255683Alumina production kt 77564 73667 81023 89289 90588 91316Aluminiumproduction kt 39669 37187 41502 44645 45294 45658consumption kt 36900 34765 40173 42398 44433 47260closing stocks g kt 4709 6485 6502 6999 7860 6257Iron and steelProduction– iron ore h Mt 1693 1588 1826 1893 1895 1955– pig iron Mt 927 900 1036 1093 1154 1192– crude steel Mt 1330 1220 1415 1510 1537 1586Iron ore trade Mt 889 955 1055 1065 1111 1182GoldMine production t 2429 2611 2741 2818 2820 2906Supply t 4014 4380 4383 4479 4470 4531Fabrication consumption i t 3027 2517 2784 2759 2647 2715

Base MetalsCopperproduction j kt 18501 18613 19177 19791 20096 21291consumption kt 18138 18178 19332 19472 20443 20851closing stocks kt 845 1125 1017 985 628 1068Leadproduction j kt 9204 9211 9823 10594 10904 11322consumption kt 9199 9223 9806 10420 10796 11148closing stocks kt 307 390 447 605 713 887Nickelproduction j kt 1382 1322 1446 1598 1680 1711consumption kt 1278 1234 1464 1584 1634 1702closing stocks kt 155 234 213 172 217 231Tinproduction j kt 332 333 352 369 369 naconsumption kt 337 322 368 375 375 naclosing stocks kt 32 46 16 5 45 naZincproduction j kt 11772 11282 12885 13131 12862 13479

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unit 2008 2009 2010 2011 2012 f 2013 fconsumption kt 11566 10920 12638 12753 12709 13186closing stocks kt 820 1221 1562 1769 2081 1958Mineral SandsProduction– ilmenite k kt 11422 9881 11470 11376 11776 12123– titaniferous slag kt 2695 2247 2749 2545 2610 2675– rutile concentrate kt 615 572 708 679 639 680– zircon concentrate kt 1282 1067 1369 1428 1376 1421

a Some figures are not based on precise or complete analyses. b 1 million litres (1 megalitre) a year equals about 17.2 barrels a day. c Includes OPEC natural gas liquids. d Includes anthracite and bituminous coal, and for the United States, Australia and New Zealand, sub-bituminous coal. e World production data have been revised to exclude reprocessed uranium. g LME and producer stocks. h China’s iron ore production adjusted to world average. i Includes jewellery consumption. j Primary refined metal. k Excludes some small producers and large tonnages produced from ilmenite–magnetite ore in the Commonwealth of Independent States. s BREE estimate. f BREE forecast. na Not available.Sources: BREE; ABARES; Australian Bureau of Statistics; Consolidated Gold Fields; Economic Commission for Europe; Gold Fields Mineral Services; International Atomic Energy Agency; International Energy Agency; International Iron and Steel Institute; International Lead–Zinc Study Group; International Nickel Study Group; ISTA Mielke and Co.; Metallgesellschaft A.G.; UNCTAD Trust Fund on Iron Ore; United Nations; World Bureau of Metal Statistics.

Table 13: Commodity production

unit2007–08

2008–09

2009–10

2010–11

2011–12

2012–13 f

EnergyCoal– black, saleable Mt 326.2 339.6 367.4 345.2 347.2 402.7– black, raw Mt 422.8 446.2 475.2 454.0 458.6 523.0– brown Mt 66.0 68.3 68.8 65.7 na naPetroleum– crude oil and condensate ML 25610 26407 25583 24745 22826 23537– petroleum products a ML 39575 39546 37200 38393 37643 34387Gas b Gm3 41.7 44.5 50.1 53.1 50.5 58.7LPG (naturally occurring) ML 3971 3930 4097 3907 3815 3928Uranium (U3O8) t 10123 10311 7109 7069 7499 7546Metalliferous minerals and metalsAluminium– bauxite Mt 63.5 64.1 67.8 68.8 72.9 75.6– alumina kt 19359 19597 20057 19041 19344 21857– aluminium (ingot metal) kt 1964 1974 1920 1938 1937 1786Copper– mine production d kt 847 890 819 958 925 1042– refined, primary kt 444 499 395 485 486 476Gold– mine production d t 229.7 217.9 239.8 264.5 252.9 256.3– Iron and steel– ore and concentrate e Mt 324.7 353.2 423.4 446.9 503.9 529.4– iron and steel Mt 8.2 5.6 6.9 7.3 5.4 4.8Lead– mine production d kt 641 596 617 697 635 579– refined g kt 203 213 189 190 174 179

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unit2007–08

2008–09

2009–10

2010–11

2011–12

2012–13 f

– bullion kt 152 155 148 133 144 150Manganese– ore, metallurgical grade kt 5428 3730 5795 6784 7357 7630– metal content of ore kt 2188 1504 2365 2756 3014 3116Nickel h– mine production d kt 190 185 157 195 236 222– refined, class I s kt 105 95 114 90 107 120– refined, class II i kt 15 15 6 10 16 11– total ore processed j kt 222 213 197 236 278 267Silver– mine production d t 1867 1764 1809 1792 1862 1852– refined t 605 751 701 712 847 948Tin– mine production d t 1767 4045 19829 18410 9202 na– refined t na na na na na naTitanium– ilmenite concentrate s kt 2205 1932 1398 1275 1331 1335– leucoxene concentrate s kt 153 117 123 200 228 228– rutile concentrate s kt 332 285 361 467 454 465– synthetic rutile s kt 672 732 553 542 480 484– titanium dioxide pigment s kt 201 214 222 204 204 204

Zinc– mine production d kt 1431 1288 1362 1479 1568 1584– refined kt 507 506 515 499 505 525Zircon concentrate s kt 563 485 408 674 706 613Other mineralsDiamonds ’000 ct 16528 15169 11138 8027 10168 12160Salt kt 9826 11314 11772 11562 11413 11159

a Excludes production from petrochemical plants. b Includes ethane, methane and coal seam gas. c Uranium is included with energy. d Primary production, metal content. e Excludes iron oxide not intended for metal extraction. g Includes lead content of lead alloys from primary sources. h Products with a nickel content of 99 per cent or more. Includes electrolytic nickel, pellets, briquettes and powder. i Products with a nickel content of less than 99 per cent. Includes ferronickel, nickel oxides and oxide sinter. j Includes imported ore for further processing. k Energy Quest. s BREE estimate. f BREE forecast.Sources: BREE; ABARES; Australian Bureau of Statistics; Consolidated Gold Fields; Coal Services Pty Limited; Department of Resources, Energy and Tourism; Energy Quest; International Nickel Study Group; Queensland Government, Department of Natural Resources and Mines.

Table 14: Volume of commodity exportsunit 2007–

082008–09

2009–10

2010–11

2011–12

2012–13 f

Resources and energyResourcesMetalliferous minerals and metals cAluminiumBauxite kt 7917 7470 8023 8595 10518 11255Alumina kt 15739 16395 16653 16227 16592 18578Aluminium (ingot metal) kt 1650 1748 1624 1686 1693 1576

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unit 2007–08

2008–09

2009–10

2010–11

2011–12

2012–13 f

CopperOre and concentrate d kt 1694 1797 1928 1750 1814 2094Refined kt 296 361 271 375 395 346Gold e t 382 437 335 301 304 297Iron and steelIron ore and pellets Mt 294 324 390 407 470 512Iron and steel g kt 2131 1741 1549 1785 1186 1038LeadOres and concentrates kt 308 381 491 494 433 413Refined kt 193 261 186 213 217 195Bullion kt 169 147 151 93 159 135Manganese d kt 5105 3226 5648 6190 6858 7112Nickel es kt 211 194 221 210 240 238TitaniumIlmenite concentrate h kt 894 1538 1763 1804 2045 2040Leucoxene concentrate kt 69 61 18 27 31 31Rutile concentrate kt 399 550 575 491 334 367Synthetic rutile s kt 513 512 513 517 536 485Titanium dioxide pigment kt 175 141 181 195 179 156

Refined silver t 335 423 420 198 269 421Tin e t 3079 4159 6031 5431 4909 naZincOres and concentrates d kt 2323 2101 2271 2317 2405 2336

Refined kt 411 451 425 410 456 453Zircon concentrate i kt 637 685 748 963 846 779Other minerals

Diamonds ’000 ct 16528 16279 10355 9900 11526 12160

Salt kt 10686 10978 11185 11162 10884 10773EnergyCrude oil a ML 15975 16588 18064 19638 19214 20586LPG ML 2589 2500 2776 2471 2115 2296LNG bs Mt 14 15 18 20 19 24Petroleum products ML 1807 1164 850 760 1151 1188Metallurgical coal Mt 137 125 157 140 142 154Thermal coal Mt 115 136 135 143 158 180Uranium (U3O8) t 10139 10114 7555 6950 7499 s 7546

a Includes condensate and other refinery feedstock. b 1 million tonnes of LNG equals aprroximately1.31 billion cubic metres of gas. c International ships and aircraft stores. d Uranium is included with energy. e Quantities refer to gross weight of all ores and concentrates. g Quantities refer to total metallic content of all ores, concentrates, intermediate products and refined metal. h Includes all steel items in ABS, Australian Harmonized Export Commodity Classification, ch. 72, ’Iron and steel’, excluding ferrous waste and scrap and ferroalloys. i Excludes leucoxene and synthetic rutile. j Data from 1991–92 refer to standard grade zircon only. s BREE estimate. f BREE forecast.Sources: BREE; ABARES; Australian Bureau of Statistics, International Trade, Australia, cat. no. 5465.0, Canberra; Australian Mining Industry Council; Department of Foreign Affairs and Trade; Department of Resources, Energy and Tourism; International Nickel Study Group.

67

Table 15: Value of commodity exports (fob)2007–08

2008–09

2009–10

2010–11

2011–12

2012–13 f

$m $m $m $m $m $mResourcesMetalliferous minerals and metalsAluminiumBauxite s 206 192 178 229 296 317Alumina 5809 6015 4969 5218 5146 6049Aluminium (ingot metal) 4967 4724 3838 4178 3797 3195Copper cOre and concentrate 4151 3618 4526 5130 5370 5828Refined 2579 2245 1980 3292 3119 2636Gold c 10903 16146 12996 13016 15462 16291Iron and steelIron ore and pellets 20511 34239 35075 58387 62703 54638Iron and steel 1562 1363 1120 1303 983 872Lead cOres and concentrates 757 645 998 1301 1185 1115Refined 674 560 425 511 475 522Bullion 595 432 409 248 541 455ManganeseOres and concentrate s 1532 1406 1395 1407 1231 1282TitaniumIlmenite concentrate d 104 171 197 198 225 224Leucoxene concentrate 23 37 11 17 22 22Rutile concentrate 277 335 382 390 252 261Synthetic rutile s 305 258 269 315 294 264Titanium dioxide pigment 375 396 448 527 571 479Nickel s 5412 2717 3875 4096 4063 3386Refined silver 187 245 254 164 268 459Tin c 42 70 101 126 102 107Zinc cOres and concentrates 2031 935 1237 1479 1386 1286Refined 1319 923 977 893 917 875Zircon concentrate e 421 540 370 532 327 233Total metalliferous minerals and metals 64745 78212 76031 102955 108736 100795

Other mineralsDiamonds s 625 676 471 366 386 449Salt 232 237 247 251 245 242Other 6169 4770 5270 5521 6154 6297Total other minerals 7026 5683 5988 6139 6785 6988Total resources 71771 83895 82019 109094 115521 107783EnergyCrude oil a 10484 8757 9534 12245 13206 14128LPG 1182 1044 1105 1068 971 1100LNG 5854 10079 7789 10437 11962 16360Bunker fuel b 1457 1537 1315 1508 1592 1655Other petroleum products 1323 788 566 526 887 1032Metallurgical coal 16038 36813 24526 29793 30708 23790Thermal coal 8365 17885 11886 13956 17111 18085Uranium (U3O8) 887 990 757 610 670 s 704Total energyDerived as sum of above 45591 77892 57478 70143 77105 76854

68

2007–08

2008–09

2009–10

2010–11

2011–12

2012–13 f

On balance of payments basis (excl. bunker fuel) 43492 75660 55771 67695 73935 74296

Total resources and energy exportsDerived as sum of above 117362 161788 139497 179237 192626 184636On balance of payments g 115904 160251 138183 177729 191035 182981Total agricultural exportsAt current prices 31340 35905 32079 36079 38095 37286On balance of payments g 29971 33917 30473 34366 37212 35298Total commodity exports hDerived as sum of above 148702 197693 171577 215316 230721 221923On balance of payments g 145875 194168 168656 212095 228247 218280

a Includes condensate and other refinery feedstock. b International ships and aircraft stores. c Value of metals contained in host mine and smelter products are not available separately and are included in the value of the mineral product or metal in which they are exported. d Excludes leucoxene and synthetic rutile; data from 1991–92 refer to bulk ilmenite only. e Data refer to standard grade zircon only. g As derived in table 1. h Sum of resources, energy and agricultural commodity exports. s BREE estimate. f BREE forecast.Sources: BREE; ABARES; Australian Bureau of Statistics, International Trade, Australia, cat. no. 5465.0, Canberra; Department of Resources, Energy and Tourism.

Table 16: Value of selected commodity imports, Australia2007–08 2008–09 2009–10 2010–11 2011–12$m $m $m $m $m

Resources and energy– aluminium (ingot metal) 10 10 27 18 37– diamonds 444 417 442 397 407– ferroalloys 154 181 118 127 106– gold (refined and unrefined) 7311 11250 7739 5426 6814

– ingot steel 2225 3191 1889 2121 2113– iron ore 311 269 259 417 223– petroleum— crude oil a 17149 14727 15031 20183 21126— natural gas 724 2166 1219 1929 2151— petroleum products b 12730 13129 11296 11445 16731– phosphate rock 80 193 10 57 55– phosphates– silver 80 223 107 490 950– other 1261 1343 1530 1487 1966Total resources and energy 42479 47098 39666 44097 52680

a Includes condensate and other refinery feedstock. b Includes LPG.Sources: BREE; Australian Bureau of Statistics, International Trade, Australia, cat. no. 5465.0, Canberra.

69

Table 17: Quarterly commodity production2010–11

2011–12

2012–13

Dec Mar Jun Sep Dec Mar Jun Sep pAluminiumBauxite kt 17448 16431 17445 18007 18349 17844 18696 19623Alumina kt 4843 4471 4666 4726 4864 4926 4828 5352Aluminium (ingot metal) kt 488 476 486 490 493 480 474 459

CoalBlack, raw Mt 113 101 116 125 119 104 111 naBlack, saleable Mt 89 77 86 95 89 81 82 na

Brown as Mt 16 16 16 na na na na naCopperMine production bs kt 244 232 239 235 253 212 225 237

Blister c kt 119 108 116 105 112 115 116 104Refined s kt 123 117 125 114 121 124 127 114

Diamonds '000 ct 2283 1667 1607 2335 1953 2840 3040 3040

GoldMine production bs t 69 63 66 65 64 61 63 61

Refined t 90 78 75 81 86 77 77 78IronIron ore and concentrate kt 11572

0102977

119176

124953

130226

119197

129492

132880

Iron and steel s kt 1887 1867 1704 1753 1214 1212 1186 1201

LeadMine production bs

kt 207 140 164 157 160 146 171 153

Bullion c kt 36 27 40 41 31 36 36 40Refined kt 57 49 51 42 45 39 48 33Manganese s kt 1698 1448 1840 1907 1766 1871 1814 1981NickelMine production bs kt 49 48 53 53 61 60 63 62

Intermediate kt 20 13 14 9 20 19 21 13Refined, class 1 kt 18 23 25 26 23 29 28 32

Refined, class 2 kt 3 2 3 4 4 4 4 3

Petroleum, fieldCrude oil and condensate e ML 6402 5316 5780 5749 5954 5190 5499 5918

LPG (naturally occurring)

ML 948 913 924 1033 956 908 918 1025

Gas dMm3 13117 12265 13513 13193 12297 11621 13344 15850

Petroleum, total refinery ML 9527 9483 9646 9318 9193 9146 9166 9756

Salt s kt 3091 2885 2494 3067 2957 2544 2844 2690Silver

70

2010–11

2011–12

2012–13

Dec Mar Jun Sep Dec Mar Jun Sep pMine production bs t 491 340 476 428 481 426 528 388

Refined t 174 189 212 250 247 168 181 156TinMine production bs t 4600 4600 4600 3100 3100 1496 1506 1506

Titanium sIlmenite concentrate kt 326 300 322 326 329 354 322 333

Leucoxene concentrate kt 48 53 58 57 57 57 57 57

Rutile concentrate kt 112 111 122 127 114 98 115 113

Synthetic rutile kt 141 133 129 118 123 105 135 120

Titanium dioxide pigment

kt 51 51 51 51 51 51 51 51

Uranium oxide (U3O8) t 2209 1668 1185 2060 2014 1601 1824 2336

ZincMine production bs kt 391 337 384 401 394 373 400 357

Refined kt 126 123 125 126 133 117 128 124Zircon concentrate s kt 156 177 183 211 191 164 141 150

a Quarterly data are not available. b Total metallic content of minerals produced. c Metallic content. d Includes methane, ethane and coal seam gas. e Energy Quest. p Preliminary. s BREE estimate. na Not available.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; Coal Services Pty Limited; Energy Quest; Queensland Government, Department of Mines and Energy; Department of Resources, Energy and Tourism, Canberra.

Table 18: Quarterly commodity exports, by volume2010–11

2011–12

2012–13

Dec Mar Jun Sep Dec Mar Jun Sep pAluminiumBauxite kt 1772 2105 2663 2724 2803 2313 2678 2765Alumina a kt 4141 3728 4094 4054 4103 4327 4108 4662Aluminium (ingot metal) kt 428 421 392 429 439 422 403 407

Coal, blackMetallurgical Mt 39.98 27.47 33.04 35.33 36.86 34.35 35.90 34.32Thermal Mt 37.57 30.26 36.45 39.66 41.14 36.91 40.73 44.76Copper bs kt 235 208 222 219 255 210 242 222

Diamonds cs '000 ct 2700 2500 2050 2684 2961 2840 3040 3040

Gold bs t 83.17 77.78 71.05 78.07 80.71 61.93 83.00 69.29IronIron ore and pellets kt 10861

893737

105499

117314

121273

108433

123092

125234

Iron and steel s kt 605 393 371 458 206 263 258 260Lead bs kt 192 158 177 168 193 155 184 165

71

2010–11

2011–12

2012–13

Dec Mar Jun Sep Dec Mar Jun Sep p

Manganese ore and concentrate

kt 1761 1681 1841 1787 1601 1427 2043 1651

Nickel ds kt 50 51 54 56 57 63 64 61PetroleumCrude oil and other refinery feedstock

ML 5456 4029 4604 4565 4856 4732 5062 5682

LNG s Mt 5.18 4.85 4.98 4.59 4.77 4.56 5.33 6.05LPG ML 583 536 557 602 465 516 532 693Refinery products ML 152 102 294 304 97 283 468 356

Salt s kt 2772 3081 2595 2793 2802 2523 2766 2571Tin b t 1359 1279 1220 1244 1249 925 1491 1480TitaniumIlmenite concentrate kt 448 433 496 518 527 492 508 512

Leucoxene concentrate kt 7 7 8 8 8 8 8 8

Rutile concentrate kt 130 123 98 85 82 81 86 86

Synthetic rutile s kt 132 131 123 136 136 141 123 126

Titanium dioxide pigment kt 44 50 53 51 41 51 37 27

Uranium oxide (U3O8) s

t 2104 1701 1227 2060 2014 1601 1824 2336

Zinc b kt 357 343 411 372 423 374 413 387Zircon concentrate kt 228 260 247 237 219 196 195 196

a Includes aluminium hydroxide. b Metallic content of all ores, concentrates, intermediate products (where applicable) and refined metal. c Unsorted and sorted. d Includes metal content of ores and concentrates, intermediate products and nickel metal. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra.

Table 19: Quarterly commodity exports, by value (fob)2010–11

2011–12

2012–13

Dec Mar Jun Sep Dec Mar Jun Sep pAluminiumBauxite $m 44 59 70 74 83 63 76 79Alumina a $m 1275 1251 1397 1366 1306 1243 1231 1264Aluminium (ingot metal)

$m 1046 1076 998 1043 983 908 862 834

Coal, blackMetallurgical $m 7649 5417 8147 8836 8636 6609 6626 5938Thermal $m 3457 3007 3637 4253 4664 3984 4210 4246Copper e $m 2270 2041 2132 2212 2251 1851 2173 1844Diamonds cs $m 108 83 69 94 106 93 93 108Gems, other than diamonds

$m 10 17 11 10 8 16 13 12

Gold, refined $m 3600 3375 3143 3898 4210 3143 4211 3784

72

2010–11

2011–12

2012–13

Dec Mar Jun Sep Dec Mar Jun Sep pIron

Iron ore and pellets $m 14021 13707 16272 17992 16126 13045 15540 13096

Iron and steel s $m 399 292 297 344 305 135 199 201Lead e $m 616 501 532 522 627 482 571 448Manganese ore and concentrate

$m 441 384 353 322 310 228 372 314

Nickel es $m 920 1131 988 908 990 1077 1087 915PetroleumCrude oil and other refinery feedstock

$m 2994 3111 3204 3111 3319 3311 3465 3731

LNG $m 2480 2463 2633 2951 3036 2818 3156 4242LPG $m 265 246 256 265 195 268 244 281Refinery products $m 104 78 208 225 92 225 345 247Salt s $m 63 70 58 63 63 57 62 58Silver, refined $m 62 43 10 48 42 57 121 60Tin e $m 30 31 33 30 25 18 29 27TitaniumIlmenite concentrate $m 49 48 55 57 58 54 56 56Leucoxene concentrate

$m 4 4 5 5 5 6 6 6

Rutile concentrate $m 96 94 101 64 52 73 64 63Synthetic rutile s $m 77 79 85 78 73 76 67 69Titanium dioxide pigment

$m 114 136 152 164 127 153 127 81

Uranium oxide (U3O8) s

$m 177 157 114 186 185 137 162 212

Zinc e $m 551 570 651 567 625 520 589 508Zircon concentrate $m 122 166 143 117 87 60 63 59Other mineral resources f

$m 1513 1028 1703 1855 1998 897 1350 1201

Total resources and energy g

$m 44560 40667 47456 51660 50591 41611 47173 43986

Total merchandise $m 61753 56794 65812 70579 69772 58487 66384 62725

Total goods and services

$m 74514 69145 78255 83116 82524 71248 78886 75707

a Includes aluminium hydroxide. b Metallic content of all ores, concentrates, intermediate products (where applicable) and refined metal. c Unsorted and sorted. d Includes metal content of ores and concentrates, intermediate products and nickel metal. e Value of all ores, concentrates, intermediate products (where applicable) and refined metal. f Derived as the difference between total resources and energy exports, below, and the sum of the above items. g Total resources and energy exports on an BREE balance of payments basis. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra.

Table 20: Quarterly resources and energy export unit returns a2010–11

2011–12

2012–13

Dec Mar Jun Sep Dec Mar Jun Sep pEnergy 308.1 341.7 369.1 388.6 382.8 350.2 337.0 330.9Metals and other minerals 284.8 311.8 319.6 321.3 296.3 273.4 282.5 251.4Total resources and energy 294.9 324.4 339.4 348.1 329.8 303.2 304.2 282.2

73

a Base: 1994-95 = 100. p Preliminary.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra.

Table 21: Quarterly commodity imports2010–11

2011–12

2012–13

Dec Mar Jun Sep Dec Mar Jun Sep pQuantityDiamonds a '000 ct 565 156 133 259 151 107 122 167Iron ore kt 1860 818 1288 1555 1314 841 844 1325Ingot steel kt 433 401 437 445 433 491 472 467Ferroalloys kt 18 12 14 15 14 23 14 15PetroleumCrude oil and other refinery feedstock ML 7949 8519 8073 7184 7269 7832 7210 8573

Natural gas kt 1218 1179 1140 1226 1089 1144 814 1108Refinery products ML 4909 4317 5219 5646 6180 5081 5282 5147Phosphate rock kt 122 13 126 80 169 10 61 177ValueDiamonds a $m 108 94 90 101 107 101 98 108Gold b $m 1677 1182 1275 1822 2043 1507 1442 1578Iron ore $m 143 86 102 100 62 29 31 44Ingot steel $m 492 471 514 544 521 533 515 507Ferroalloys $m 35 24 28 28 27 26 26 29Nickel $m 11 49 47 54 39 48 18 18PetroleumCrude oil and other refinery feedstock $m

Natural gas $m 4423 5800 5739 4963 5173 5641 5349 5654Refinery products $m 512 427 413 594 561 595 401 580Phosphate rock $m 2831 2310 3841 3936 4535 4063 4197 3920Silver $m 16 1 19 15 29 1 10 29Other $m 103 111 254 572 187 93 98 104

Total $m 10666 11039 12703 13150 13871

13016 12699 13033

a Includes sorted and unsorted, gem and industrial diamonds, and diamond dust and powder. b Refined and unrefined bullion. p Preliminary. Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra.

Table 22: Quarterly private resources and energy exploration expenditure2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pEnergyPetroleumOnshore $m 756.5 919.7 186.4 248.6 278.3 163.1 229.7 275.7Offshore $m 2558.9 2277.3 662.9 531.6 618.7 432.9 694.1 808.3Total $m 3315.4 3197.0 849.3 780.2 897.0 596.0 923.8 1084.0Coal $m 519.7 834.3 202.7 227.4 217.7 177.5 211.7 170.6Uranium $m 213.9 153.6 46.6 54.0 45.6 29.3 24.7 23.5Total energy $m 4049.0 4184.9 1098.6 1061.6 1160.3 802.8 1160.2 1278.1Metals and other mineralsCopper $mDiamonds $m 323.1 442.6 101.5 108.9 114.6 98.7 120.4 102.5

74

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pGold $m na na na na 2.2 1.1 na 1.4Iron ore $m 652.2 768.0 178.2 184.2 200.0 168.8 215.0 194.4Mineral sands $m 665.0 1150.6 214.7 234.7 311.8 267.9 336.2 280.5Nickel, cobalt $m na na na na 11.0 9.3 na 10.9Silver, lead and zinc $m 270.9 265.4 71.6 73.6 49.3 64.1 78.4 43.9

Other $m 75.5 87.5 19.8 22.0 22.9 21.2 21.4 21.1Total metals and other minerals

$m 2217.7 2965.1 658.1 702.0 769.1 669.3 824.7 700.6

Total expenditure $m 6266.7 7150.0 1756.7 1763.6 1929.4 1472.1 1984.9 1978.7

p Preliminary. na Not available.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra.

Table 23: Resources and energy pricesAlumina Aluminium Gold Iron ore Thermal

coalMetallurgical coal Crude oil b

avg exportunit value

(high grade)LME cash

LondonAM fix




West Texas Intermediatespot price

Brent spot price

A$/t US$/t US$/oz A$/t A$/t A$/t US$/bbl US$/bbl2009–10 298.39 2016.26 1091.75 89.96 88.06 155.95 75.15 74.512010–11 321.54 2382.92 1371.59 143.50 97.37 212.12 89.29 96.002011–12 310.12 2165.74 1672.02 133.38 107.99 215.58 94.27 110.712011July 334.64 2511.98 1568.53 127.35 104.80 251.91 97.14 116.42August 344.91 2391.91 1759.50 129.51 108.59 251.55 86.34 109.93September

330.60 2335.47 1775.85 125.95 108.24 247.03 85.61 109.79

October 331.43 2172.19 1668.08 122.40 113.44 244.51 86.43 108.79November 320.50 2073.55 1735.98 121.31 114.10 235.78 97.13 110.49December 304.37 2018.60 1652.73 107.85 112.71 223.65 98.81 102.792012January 281.81 2137.23 1656.10 120.02 110.35 204.30 100.17 111.27February 283.09 2203.88 1743.10 114.76 106.43 185.21 102.31 119.10March 296.89 2184.80 1675.06 116.87 106.65 185.28 106.20 124.54April 299.15 2046.53 1648.54 116.05 103.22 185.17 103.39 120.37May 303.55 2002.52 1585.11 109.12 105.02 186.56 94.55 110.29June 295.76 1878.15 1595.63 110.43 101.96 182.14 72.94 83.85July 279.46 1874.14 1592.78 104.46 97.22 173.97 87.92 102.59August 265.07 1838.05 1625.68 99.58 94.79 173.59 94.16 112.68September

269.10 2042.90 1741.93 92.86 92.53 171.59 94.65 113.03

Uranium Copper Lead Zinc Silver Nickel Rutile e Zircon

Industry spot price

(high grade) LME cash

LME cash

(high grade) LME cash

London fix LME cash avg export

unit value

avg export unit value

US$/lb US$/t US$/t US$/t USc/troyoz US$/t A$/t A$/t2009–10 43.81 6691.13 2093.11 2065.82 1688.07 19390.25 664.64 494.192010–11 57.13 8670.65 2392.32 2242.53 2880.20 23962.89 793.37 551.922011–12 51.50 8195.57 2127.29 2018.36 3320.62 19281.11 756.42 386.75

75

2011July 51.50 9619.24 2682.60 2390.55 3791.71 23731.19 1118.13 2011.05August 49.00 9038.84 2401.82 2211.27 4032.43 22068.41 1248.48 2215.28September

52.50 8702.77 2300.75 2078.25 3858.77 20416.82 1357.69 2324.96

October 52.00 7338.81 1948.57 1859.14 3203.10 18886.43 1306.34 2408.35November 51.75 7551.77 1982.05 1916.11 3308.18 17882.05 1370.18 2542.15December 51.75 7565.57 2011.40 1911.76 3041.15 18170.24 1496.33 2518.462012January 52.00 8022.75 2089.77 1973.59 3076.86 19800.71 2695.24 2349.57February 52.00 8422.69 2126.12 2058.21 3414.05 20465.00 2459.20 2202.14March 51.00 8457.05 2061.45 2035.39 3295.32 18635.22 2485.03 2271.05April 51.75 8259.63 2063.05 1996.74 3155.24 17897.37 2794.65 2221.28May 52.00 7936.28 2002.43 1932.89 2866.59 17035.22 2978.54 2526.84June 50.75 7431.44 1850.65 1853.26 2804.03 16535.00 3011.40 2482.84July 49.50 7589.39 1876.39 1851.18 2743.18 16159.09 2857.53 2435.94August 48.50 7492.45 1895.75 1813.75 2869.68 15657.73 2779.14 2362.96September

46.50 8068.33 2167.78 2002.10 3360.85 17215.50 2831.77 2331.78

a Lump and fines. b US Department of Energy, Energy Information Administration. c Average of weekly restricted spot price published by The Ux Consulting Company. d London fix rate from May 2001; Handy and Harman, commercial bar, minimum 99.9 per cent prior to May 2001. e Bagged only after August 1999. g Bagged only after September 1999. s BREE estimate. na Not available.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; London Metal Exchange; London Bullion Market Association; The Ux Consulting Company; US Department of Energy.

Table 24: Aluminium2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionMineBauxite

Queensland kt 19504 21563 5061 5403 5600 4974 5586 6179

Western Australia s kt 4234

0 43768 10578 10745 10833 11008 11183 11358

Northern Territory kt 6982 7565 1805 1860 1916 1862 1927 2086

Australia s kt 68827 72895 17445 18007 18349 17844 18696 19623

Alumina content s kt 26039 27989 6552 6935 7089 6774 7191 7643

Smelter and refinery

Alumina kt 19041 19344 4666 4726 4864 4926 4828 5352

Aluminium (ingot metal) kt 1938 1937 486 490 493 480 474 459

ExportsQuantityBauxite kt 8595 10518 2663 2724 2803 2313 2678 2765

Alumina ab kt 16227 16592 4094 4054 4103 4327 4108 4662

Aluminium (ingot metal)

76

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pChinese Taipei kt 210 168 55 41 55 37 35 51Indonesia kt 104 137 29 31 33 36 37 28Japan kt 569 587 125 153 163 134 137 134Korea, Rep. of kt 352 264 78 77 64 61 62 67Malaysia kt 79 81 16 22 16 19 24 18Thailand kt 130 144 33 40 32 30 42 42Other kt 241 312 55 65 76 106 65 67Total kt 1686 1693 392 429 439 422 403 407ValueBauxite $m 229 296 70 74 83 63 76 79Alumina a b $m 5218 5146 1397 1366 1306 1243 1231 1264Aluminium (ingot metal) $m 4178 3797 998 1043 983 908 862 834

ImportsQuantityBauxite kt 7 7 1 2 2 2 2 1Alumina a b kt 13 10 3 2 2 2 2 2Aluminium (ingot metal) kt 6 15 2 4 5 3 4 7

ValueBauxite $m 4 3 1 1 1 1 1 1Alumina a $m 14 12 3 3 2 4 2 3Aluminium (ingot metal) $m 18 37 5 10 12 7 9 16

PricesAlumina c A$/t 322 310 341 337 318 287 300 271AluminiumLME cash d US$/t 2383 2166 2597 2419 2088 2175 1981 1914Australia c A$/t 2478 2242 2547 2433 2237 2151 2141 2048

a Includes aluminium hydroxide. b Country details confidential. c Average export unit value. d High grade. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; London Metal Exchange.

Table 25: Coal2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionMineBlack coal, rawUnderground Mt 107.81 94.40 25.39 24.89 23.89 21.82 23.80 naOpencut Mt 346.14 364.23 90.64 99.86 95.00 82.64 86.73 naNew South Wales Mt 204.85 221.00 51.37 56.76 54.11 53.07 57.06 62.32Queensland Mt 239.62 228.15 62.30 65.62 62.41 49.02 51.10 naWestern Australia a Mt 5.00 5.00 1.25 1.25 1.25 1.25 1.25 1.25South Australia a Mt 3.84 3.84 0.96 0.96 0.96 0.96 0.96 0.96Tasmania a Mt 0.64 0.64 0.16 0.16 0.16 0.16 0.16 0.16Australia Mt 453.95 458.63 116.03 124.75 118.89 104.46 110.53 naBlack coal, saleableUnderground Mt 76.43 73.12 17.84 20.11 18.95 16.42 17.64 naOpencut Mt 268.81 274.08 67.70 74.50 70.34 64.67 64.56 naNew South Wales Mt 156.95 167.17 38.88 43.76 41.11 39.88 42.43 47.23

77

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pQueensland Mt 179.83 171.57 44.54 48.73 46.07 39.10 37.66 naWestern Australia a Mt 4.00 4.00 1.00 1.00 1.00 1.00 1.00 1.00South Australia a Mt 3.84 3.84 0.96 0.96 0.96 0.96 0.96 0.96Tasmania a Mt 0.62 0.62 0.15 0.15 0.15 0.15 0.15 0.15Australia Mt 345.24 347.20 85.53 94.60 89.29 81.10 82.21 naBrown coal bVictoria Mt 65.66 na 16.42 na na na na naExportsQuantityMetallurgical coal, high qualityBrazil Mt 2.88 2.34 0.61 0.64 0.53 0.69 0.47 0.71China Mt 9.64 9.84 1.00 1.76 2.95 3.44 1.69 1.10Chinese Taipei Mt 4.06 4.51 0.98 1.05 1.07 1.08 1.31 0.85European Union 27 Mt 15.25 15.93 4.55 5.03 3.85 3.23 3.82 3.93India Mt 25.19 23.28 7.29 6.05 5.79 5.17 6.27 5.96Japan Mt 23.42 22.11 4.96 5.75 6.20 4.58 5.57 6.14Korea, Rep. of Mt 8.10 8.86 1.80 2.41 2.64 2.10 1.71 1.87Other Mt 3.06 4.72 0.59 1.30 1.12 1.21 1.10 0.78Total Mt 91.60 91.59 21.79 23.99 24.15 21.49 21.95 21.33

Metallurgical coal, other cEuropean Union 27 Mt 1.82 1.70 0.35 0.25 0.67 0.30 0.48 0.26India Mt 5.72 6.02 1.39 1.24 1.37 1.82 1.59 1.51Japan Mt 19.19 18.09 4.54 4.09 5.25 3.74 5.01 5.04Other Mt 22.12 25.04 4.98 5.75 5.42 7.01 6.86 6.19Total Mt 48.85 50.85 11.25 11.34 12.71 12.86 13.94 13.00Total metallurgical coal

Mt 140.46 142.44 33.04 35.33 36.86 34.35 35.90 34.32

Thermal coalChinese Taipei Mt 20.12 17.52 4.95 5.30 4.83 3.92 3.46 4.54European Union 27 Mt 0.14 0.04 0.14 0.00 0.00 0.00 0.04 0.00China Mt 16.67 28.46 2.45 2.29 4.37 5.43 1.45 5.42Japan Mt 66.96 69.73 15.85 17.56 16.72 18.41 17.03 20.32Korea, Rep. of Mt 28.19 28.85 6.61 7.54 8.21 6.67 6.43 8.28Other Mt 27.90 42.32 8.89 9.25 11.37 7.92 13.78 11.62Total Mt 20.12 17.52 4.95 5.30 4.83 3.92 3.46 4.54Exports Mt 143.32 158.45 36.45 39.66 41.14 36.91 40.73 44.76Quantity dOther coal Mt 0.76 0.63 0.14 0.15 0.25 0.20 0.02 0.00ValueMetallurgical coalHigh quality $m 21143 21707 5810 6545 6166 4540 4455 4090Other quality $m 8650 9001 2337 2291 2470 2069 2171 1848Total metallurgical coal

$m 29793 30708 8147 8836 8636 6609 6626 5938

Thermal coal $m 13956 17111 3637 4253 4664 3984 4210 4246Other coal $m 106 94 28 26 37 27 4 0Total coal $m 43854 47912 11812 13115 13337 10620 10840 10184Coke $m 177 302 40 86 69 53 94 71Prices eMetallurgical coalHigh quality A$/t 230.81 237.00 266.63 272.80 255.32 211.23 202.95 191.76

78

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pOther quality A$/t 177.06 177.01 207.69 202.03 194.36 160.91 155.70 142.18Thermal coal A$/t 97.37 107.99 99.78 107.21 113.36 107.94 103.36 94.88

a Quarterly data derived from annual BREE estimates. b Quarterly data not available. c Country details confidential for various time periods for Brazil, Chinese Taipei, Dem. Peoples Rep. of Korea, Italy, Pakistan and Republic of Korea–commencing from October 1996. d Quantity details for coke not available. e Average export unit value. p Preliminary. s BREE estimate. na Not available.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; Coal Services Pty Limited; Queensland Government, Department of Mines and Energy.

Table 26: Copper2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionMine sCopper ore and concentrate kt 3507 3401 846 902 904 775 820 883

Copper content of all minerals producedNew South Wales a kt 158 173 43 46 46 39 42 42Queensland a kt 306 271 75 81 78 53 58 64Western Australia a kt 156 147 35 32 38 36 40 56South Australia kt 305 310 80 69 84 78 79 68Tasmania kt 26 25 6 6 6 6 7 7Australia a kt 958 925 239 235 253 212 225 237Smelter and refineryBlister copper (primary) b kt 459 449 116 105 112 115 116 104Refined copper (primary) s kt 485 486 125 114 121 124 127 114ExportsQuantityCopper concentrateChina c kt 566 577 180 172 147 161 98 162India kt 560 584 116 131 163 117 173 134Japan kt 303 385 77 122 92 55 116 118Korea, Rep. of kt 205 191 42 34 79 29 49 46Philippines kt 83 9 6 0 9 0 0 4Other kt 33 68 11 6 11 19 31 6Total kt 1750 1814 431 466 501 380 467 470Refined copperChina c kt 121 146 19 35 52 37 23 26Chinese Taipei kt 54 51 19 15 13 11 12 13Germany kt 0 0 0 0 0 0 0 0Indonesia kt 24 31 6 8 6 7 10 8Japan kt 10 1 8 0 1 0 0 0Korea, Rep. of kt 26 2 4 0 1 0 1 0Malaysia kt 74 89 21 20 20 23 27 22Singapore kt 4 1 0 0 0 1 0 0Thailand kt 20 44 5 5 5 12 22 13Vietnam kt 28 21 6 4 3 6 8 4Other kt 14 8 4 2 3 1 2 1Total kt 375 395 92 89 105 97 104 87

79

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pCopper content of all primarymaterials exported ds kt 877 926 222 219 255 210 242 222Value

Copper concentrate $m 5130 5370 1330 1480 1450 1080 1360 1210

Refined copper $m 3292 3119 802 733 801 772 813 635

Total $m 8422 8489 2132 2212 2251 1851 2173 1844

Prices e

LME cash US$/t 8671 8196 9152 912

0 7485 8301 7876 7717

Australia A$/t 8752 7933 8649 8658 7407 7869 7798 7425

a Includes copper cathode and copper precipitate. b Copper content. c Excludes Hong Kong. d Copper content of all ores and concentrates, slags, residues, intermediate products, refined copper, copper powder and flakes. e Based on LME cash, midday, high grade, 25 tonne warrants. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; London Metal Exchange.

Table 27: Diamonds2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionDiamonds

Northern Territory '000 ct 0 0 0 0 0 0 0 0

Western Australia '000 ct 8027 10168 1607 2335 1953 2840 3040 3040

Australia '000 ct 8027 10168 1607 2335 1953 2840 3040 3040

ExportsQuantityDiamonds

Unsorted s '000 ct 9810 11455 2020 2668 2938 2829 3020 3021

Sorted

Gem '000 ct 90 71 30 16 24 11 20 19

Industrial a'000 ct 0 0 0 0 0 0 0 0

Total s ‘000 ct 9900 11526 2050 2684 2961 2840 3040 3040

ValueDiamondsUnsorted s $m 225 256 41 61 67 65 64 70SortedGem $m 141 130 28 33 39 29 29 38Industrial a $m 0 0 0 0 0 0 0 0Total s $m 366 386 69 94 106 93 93 108OpalsRough $m 6 4 1 2 1 0 0 2Cut and polished $m 35 36 9 7 6 13 10 6

80

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pTotal $m 41 40 9 9 6 14 10 8SapphiresRough $m 1 1 0 0 0 0 0 2Total $m 1 1 0 0 0 0 0 2Other gemstones b $m 8 6 2 1 1 2 2 3

Total gemstones $m 49 47 11 10 8 16 13 12ImportsQuantityDiamonds

Unsorted '000 ct 2 1 0 0 1 0 0 0

Sorted

Gem '000 ct 282 261 61 73 63 66 59 66

Industrial a'000 ct 1 60 0 47 8 4 0 0

Dust and powder '000 ct 904 316 72 138 79 36 63 100

ValueDiamondsUnsorted $m 0 0 0 0 0 0 0 0Sorted Gem $m 394 404 89 100 106 101 97 108 Industrial a $m 2 2 0 1 0 0 1 0Dust and powder $m 1 1 0 0 0 0 0 0Total $m 397 407 90 101 107 101 98 108

a Excludes dust, powder and unsorted diamonds. b Includes cut and polished sapphires from 1 July 2000. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra.

Table 28: Gold2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionMine sGold content of all minerals producedNew South Wales t 30 28 8 8 7 6 7 7Victoria t 6 5 1 2 1 1 0 1Queensland t 16 16 4 4 4 4 4 4Western Australia t 182 179 45 45 45 43 45 44South Australia t 16 13 4 3 3 3 3 3Tasmania t 4 4 1 1 1 1 1 1Northern Territory t 11 9 2 2 2 3 2 3Australia t 265 253 66 65 64 61 63 61RefineryPrimaryAustralian origin t 210 204 50 51 51 51 51 49Overseas origin t 71 62 17 15 17 14 15 16SecondaryAustralian origin t 4 5 1 1 1 1 1 1Overseas origin t 36 51 7 13 17 11 9 13

81

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pTotal t 321 321 75 81 86 77 77 78ExportsQuantityRefined and unrefined bullionHong Kong, China t 14 3 3 2 0 1 1 1India t 98 58 27 17 14 20 7 7Middle East t 0 0 0 0 0 0 0 0–United Arab Emirates t 0 0 0 0 0 0 0 0

Singapore t 25 22 8 10 3 4 5 12Switzerland t 0 1 0 0 0 0 0 0Thailand t 56 32 12 16 8 5 4 3United Kingdom t 80 90 20 25 35 14 16 18Other t 9 15 1 7 5 1 1 6Total t 301 304 71 78 81 62 83 69Value

Refined $m 13016 15462 3143 3898 4210 3143 4211 3784

ImportsValueRefined and unrefined bullion $m 5426 6814 1275 1822 2043 1507 1442 1578

PricesLondon AM fix US$/oz 1372 1672 1505 1701 1686 1691 1610 1653Australia A$/oz 1389 1621 1425 1626 1666 1602 1591 1592

p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; London Bullion Market Association.

Table 29: Iron2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionIron ore and concentrate aWestern Australia kt 433231 489178 115383 121305 126389 115277 126207 129169South Australia kt 9868 10455 2611 2541 2754 2959 2200 2800 sTasmania s kt 1840 2235 521 506 632 512 585 411Northern Territory kt 2011 2000 661 600 450 450 500 500 sAustralia s kt 446949 503868 119176 124953 130226 119197 129492 132880Iron content s kt 273510 285118 69738 70269 72297 69178 73373 78150Iron and steel bs kt 7305 5365 1704 1753 1214 1212 1186 1201ExportsQuantityIron ore and pelletsPellets, sinters and briquettes kt 1634 2227 421 463 393 871 500 621

Fines kt 300734 355029 78415 89332 91432 81317 92949 95200Lump and run of mine kt 104508 112857 26664 27519 29449 26246 29643 29413

China c kt 279355 333951 73301 81033 88619 78138 86162 91771Chinese Taipei kt 12613 12391 3195 3353 2783 2830 3425 2883

82

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pEuropean Union 27 kt 986 791 327 161 313 156 161 327Japan kt 72893 76573 17582 20730 18440 16323 21080 18543Korea, Rep. of kt 41029 46303 11093 12038 11065 10936 12265 11335Other kt 4 104 0 0 53 50 0 376Total iron ore and pellets kt 406880 470113 105499 117314 121273 108433 123092 125234

Iron content kt 252473 291417 65446 72690 75178 67246 76302 77607SteelIron and steel s kt 1785 1186 371 458 206 263 258 260Scrap kt 1575 2148 455 411 573 558 606 444

ValueIron ore and pelletsPellets, sinters and briquettes $m 260 368 78 84 75 131 78 74

Fines $m 41483 45903 11631 13260 11727 9466 11450 9650Lump and run of mine $m 16647 16432 4562 4648 4324 3448 4012 3373

Total $m 58387 62703 16272 17992 16126 13045 15540 13096SteelIron and steel s $m 1303 983 297 344 305 135 199 201Scrap $m 769 1017 226 204 276 247 290 200Total $m 2072 2000 523 548 581 382 489 401ImportsQuantityIron ore d kt 5442 4555 1288 1555 1314 841 844 1325Iron and steel kt 1867 1841 437 445 433 491 472 467Ferroalloys kt 69 65 14 15 14 23 14 15ValueIron ore d $m 417 223 102 100 62 29 31 44Iron and steel $m 2121 2113 514 544 521 533 515 507Ferroalloys $m 127 106 28 28 27 26 26 29Total $m 2665 2442 643 672 610 588 572 579PricesJapanese negotiated e USc/dmtu 230.18 na 248.28 248.60 211.18 212.66 195.26 205.72

a For use in iron and steel making; includes pellets for Tasmania. b Includes recovery from scrap. c Excludes Hong Kong. d Includes limonite ore used in the production of refined nickel products. e Indicative price: Australian hematite fines to Japan (fob), per dry metric tonne unit, for Japanese fiscal year commencing 1 April. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra.

Table 30: Lead2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionMine sLead ore and concentrates kt 934 892 234 218 233 204 238 213Lead content of all minerals producedNew South Wales kt 77 78 22 20 18 19 20 22Queensland kt 470 457 121 110 117 105 125 108

83

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pWestern Australia kt 78 10 2 4 2 2 2 3South Australia kt 7 9 2 2 2 2 3 3Tasmania kt 29 39 8 11 11 8 10 5Northern Territory kt 35 42 9 11 10 10 10 11Australia kt 697 635 164 157 160 146 171 153Smelter and refineryRefined lead (primary) a kt 190 174 51 42 45 39 48 33Domestic despatchesRefined lead kt 28 22 5 5 5 6 6 6ExportsQuantityLead concentrateChina kt 247 148 36 33 54 24 37 40European Union 27 kt 53 53 11 0 16 21 15 0Japan kt 67 71 17 17 22 11 21 16Korea, Rep. of kt 111 134 39 22 43 32 38 32Other kt 17 27 12 0 11 0 16 27Total kt 494 433 116 73 145 88 127 115Lead bullion bUnited Kingdom kt 93 159 12 39 29 46 46 22Other kt 0 0 0 0 0 0 0 0Total kt 93 159 12 39 29 46 46 22Refined leadChina kt 13 1 1 1 0 0 0 0Chinese Taipei kt 5 8 2 2 1 2 2 3India kt 35 32 11 8 8 8 8 14Indonesia kt 5 4 1 1 1 0 2 4Korea, Rep. of kt 32 38 9 9 12 8 9 12Malaysia kt 64 77 16 34 23 11 9 14South Africa kt 9 9 3 2 2 3 3 3Thailand kt 16 12 6 4 3 2 3 4Vietnam kt 20 17 5 3 3 4 7 7Other kt 15 18 5 7 5 3 4 3Total kt 213 217 58 70 58 42 47 63Lead content of all primary materials exported cs kt 676 700 177 168 193 155 184 165ValueLead concentrate $m 1301 1185 359 215 390 238 342 266Lead bullion $m 248 541 30 138 109 161 134 59Refined lead $m 511 475 143 169 128 83 95 123Total $m 2059 2202 532 522 627 482 571 448PricesLME cash d US$/t 2392 2127 2550 2458 1981 2092 1978 1974Australia e A$/t 2635 2342 2718 2617 2293 2231 2226 2151

a Includes lead content of lead alloys from primary sources. b Includes a substantial precious metal content, mainly silver. c Lead content of all ores, concentrates, slags, residues, bullion, and refined lead. d Based on LME cash, midday, standard grade, minimum 25 tonne warrants. e Pasminco Metals, 99.97–99.99 per cent, fob/for Port Pirie. p Preliminary. s BREE estimate. na Not available.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; London Metal Exchange.

84

Table 31: Manganese2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionManganese ore and concentrateWestern Australia s kt 1786 2184 551 568 544 524 547 546Northern Territory kt 4997 5174 1290 1339 1222 1346 1267 1435Australia s kt 6784 7357 1840 1907 1766 1871 1814 1981Manganese content s kt 2756 3014 754 782 725 763 744 807ExportsQuantityManganese ore and concentrate kt 6190 6858 1841 1787 1601 1427 2043 1651

ValueManganese ore and concentrate $m 1407 1231 353 322 310 228 372 314

PricesJapanese negotiated a US$/t 767.9

7 544.08 633.33 540.00 540.00 463.00 463.0

0 513.33

A$/t 777.81 527.46 598.59 514.6

7 533.72 438.66 458.59 494.31

a Indicative price: high grade ore (48 – 50 per cent Mn) to Japan for Japanese fiscal year commencing 1 April. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra.

Table 32: Nickel2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProduction asMineNickel contentWestern Australia kt 195 236 53 53 61 60 63 62Tasmania kt 0 0 0 0 0 0 0 0Australia kt 195 236 53 53 61 60 63 62Smelter and refineryIntermediate nickel kt 60 70 14 9 20 19 21 13Refined nickel, class 1 b kt 90 107 25 26 23 29 28 32

Refined nickel, class 2 c kt 10 16 3 4 4 4 4 3

ExportsQuantityNickel d kt 210 240 54 56 57 63 64 61ValueOres and concentrates $m 859 1133 254 145 331 275 382 270

Intermediate products e $m 960 724 165 164 150 212 198 166

Refined nickel, class 1 b $m 2093 2007 517 541 466 538 463 444

Refined nickel, class 2 c $m 184 198 53 58 44 53 44 34

Total $m 4096 4063 988 908 990 1077 1087 915Imports

85

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pValuePrimary nickel products f $m 291 281 84 95 76 68 41 50

Prices

LME cash g US$/t 23963 19281 24165 22047 18306 19603 17169 16317

A$/t 24273 18693 22872 20946 18094 18581 16969 15727

a Details of production of nickel metal, matte, oxide, sinter and nickel–cobalt sulphide are not available. b Products with a nickel content of 99 per cent or more. Includes electrolytic nickel, pellets, briquettes and powder. c Products with a nickel content of less than 99.8 per cent. Includes ferronickel, nickel oxides and oxide sinter. d Includes metal content of ores and concentrates, intermediate products and nickel metal. e Includes matte and speiss for further refining. f Includes matte, sinter and intermediate products; ferronickel, unwrought nickel metal and alloys and scrap. Also includes value of limonite ore used in the production of refined nickel products. g Average cash settlement price for melting grade refined nickel. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; London Metal Exchange.

Table 33: Petroleum2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionField

Crude oil d ML 16115 14643 3731 3691 3949 3339 3664 3710

Condensate d ML 8630 7749 2049 2058 2005 1851 1835 2208

Total d ML 24745 22393 5780 5749 5954 5190 5499 5918

Production rate d '000 bbl/day 428 389 400 397 412 359 389 409

LPG ML 3907 3815 924 1033 956 908 918 1025

Methane Mm3 46851 43725 11932 11562 10676 9911 11577 14079

Ethane Mm3 295 376 80 103 96 75 103 114Coal seam gas Mm3 5957 6355 1501 1529 1526 1636 1665 1656RefineryRefinery input ML 39871 38720 10235 9862 9479 9894 9485 9658Refinery outputLPG ML 1467 1222 371 304 292 334 293 336Automotive gasoline ML 1664

3 15697 4159 4098 3824 3773 4002 4126

Aviation gasoline ML 91 89 25 24 26 25 14 33Aviation turbine fuel ML 5448 5576 1380 1414 1362 1426 1374 1480

Kerosine ML 0 0 0 0 0 0 0 1Heating oil ML 16 13 2 3 6 2 2 4Automotive diesel oil ML 1285

8 12510 3225 3084 3242 3168 3016 3316

Industrial and marine diesel fuel ML 0 28 0 0 0 0 28 42

Fuel oil (excl. ML 952 942 235 223 228 243 249 251

86

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep prefinery fuel)Lubricating oil basestock ML 64 –5 2 –2 –2 0 0 0

Bitumen ML 476 421 135 109 132 98 82 73Other products ML 377 328 112 63 84 77 104 93

Total ML 38393 37643 9646 9318 9193 9146 9166 9756

SalesLPGAutomotive use b ML 2022 1908 491 504 485 468 451 463Total ML 3936 3652 1011 989 890 866 907 986Automotive gasolinePremium unleaded ML 2247 2449 559 589 628 630 602 622

Regular unleaded ML 11388 11313 2754 2810 2890 2837 2776 2816

Other unleaded ML 5090 5000 1221 1262 1264 1244 1230 1275

Total ML 18725 18762 4534 4662 4781 4711 4608 4714

Aviation gasoline ML 79 84 20 21 21 20 22 21Aviation turbine fuel ML 7068 7348 1768 1845 1852 1824 1827 1928

Kerosine ML 27 13 5 4 3 3 3 2Heating oil ML 5 4 1 0 0 2 1 1Automotive diesel oil ML 2005

4 21630 5335 5397 5511 5167 5554 5572

Industrial and marine diesel fuel ML 7 0 0 0 0 0 0 0

Fuel oil ML 757 942 201 223 245 276 198 147Lubricating oil and greases ML 430 348 108 88 87 84 89 91

Bitumen ML 719 730 194 148 204 194 184 152Other products ML 289 283 68 66 66 79 72 62

Total ML 52095 53797 13244 13443 13663 13226 13466 13676

ExportsQuantityCrude oil and other refinery feedstockChina ML 3632 4397 1046 1206 1158 949 1085 609Chinese Taipei ML 266 410 129 15 16 266 113 297Japan ML 2002 1817 571 243 540 533 501 418Korea, Rep. of ML 3794 1807 365 392 606 511 298 746New Zealand ML 56 126 1 1 1 3 121 102Singapore ML 2649 3702 644 713 1230 629 1130 1691United States ML 189 451 0 101 263 0 86 96Other ML 7050 6502 1848 1894 1041 1840 1727 1722

Total ML 19638 19214 4604 4565 4856 4732 5062 5682

LNG s Mt 19.96 19.25 4.98 4.59 4.77 4.56 5.33 6.05LPG ML 2471 2115 557 602 465 516 532 693Refinery productsAutomotive gasoline ML 175 175 78 117 0 21 37 44

87

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pAviation turbine fuel ML 12 7 0 1 1 4 1 3

Diesel fuel c ML 117 130 71 42 6 73 8 39Fuel oil ML 194 485 65 60 40 90 295 154Aviation gasoline ML 20 30 3 6 11 6 7 7Lubricants ML 223 304 78 76 34 88 106 98Other products ML 19 21 –1 2 5 1 13 12Total ML 760 1151 294 304 97 283 468 356Ships' and aircraft storesAviation turbine fuel ML 1985 1985 496 496 496 496 496 496

Fuel oil ML 259 269 65 65 65 68 72 67Other products ML 37 32 15 18 7 3 4 6Total ML 2281 2286 576 579 568 566 572 570ValueCrude oil and other refinery feedstock

$m 12245 13206 3204 3111 3319 3311 3465 3731

LNG $m 10437 11962 2633 2951 3036 2818 3156 4242

LPG $m 1068 971 256 265 195 268 244 281Refinery products–Automotive gasoline $m 120 127 57 84 0 15 27 34

–Aviation turbine fuel $m 8 6 0 0 0 3 2 1

–Diesel fuel c $m 94 115 56 39 7 62 7 29–Fuel oil $m 99 314 38 35 25 58 196 82–Aviation gasoline $m 22 30 4 6 12 6 7 6–Lubricants $m 154 261 50 59 36 75 91 79–Other products $m 29 33 2 1 11 5 16 16–Total 526 887 208 225 92 225 345 247

Total $m 23652 25762 6301 6551 6643 6046 6522 7923

Ships' and aircraft stores $m

Aviation turbine fuel $m 1313 1368 337 337 341 344 346 342

Fuel oil $m 157 187 42 42 44 48 54 47Other products $m 38 37 16 19 8 4 6 8Total $m 1508 1592 395 398 393 396 405 397ImportsQuantityCrude oil and other refinery feedstockIndonesia ML 4805 3310 1019 662 959 736 952 1174Malaysia ML 5929 4942 1274 866 1335 1602 1138 1584Middle East–Saudi Arabia ML 156 216 64 0 0 216 0 0–United Arab Emirates ML 4683 4599 1688 1260 1566 863 910 1138

–Other ML 0 0 0 0 0 0 0 0–Total Middle East ML 4880 4815 1793 1260 1566 1079 910 1138

88

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pNew Zealand ML 2565 2195 640 578 498 572 547 543Papua New Guinea ML 1612 1475 409 305 399 408 364 273

Singapore ML 497 554 162 104 96 171 182 191Vietnam ML 2554 1788 558 831 356 262 339 739Other ML 9383 10416 2218 2577 2058 3003 2778 2931

Total ML 32225 29495 8073 7184 7269 7832 7210 8573

Natural gas kt 4799 4273 1140 1226 1089 1144 814 1108Refined productsLPG ML 888 1023 191 411 168 158 285 147Automotive gasoline ML 2944 3672 599 775 1176 886 834 658

Aviation turbine fuel ML 2086 2252 485 642 646 468 496 685

Diesel fuel c ML 8820 11225 2888 2704 2920 2702 2898 2901Fuel oil ML 1559 1623 375 361 451 455 355 382Lubricants ML 463 528 123 132 141 128 126 147Other products ML 2002 1866 558 619 677 283 287 227

Total ML 18762 22188 5219 5646 6180 5081 5282 5147

ValueCrude oil and other refinery feedstock

$m 20183 21126 5739 4963 5173 5641 5349 5654

Natural gas $m 1929 2151 413 594 561 595 401 580Refined products–LPG $m 376 452 87 167 65 78 142 65–Automotive gasoline $m 1838 2916 471 599 905 717 695 503

–Aviation turbine fuel $m 1440 1744 378 482 503 368 390 514

–Diesel fuel c $m 6237 8838 2309 2053 2307 2168 2310 2214–Fuel oil $m 836 1062 229 217 297 312 235 235–Lubricants $m 671 827 189 212 228 191 195 214–Other products $m 1976 3045 591 801 791 824 630 756

–Total $m 11445 16731 3841 3936 4535 4063 4197 3920

Total $m 33557 40009 9993 9494 10269 10300 9946 10154

PricesDubai US$/bbl 74.60 109.17 110.82 107.19 104.64 116.37 104.36 106.00West Texas intermediate US$/bbl 89.29 94.27 102.27 89.59 94.10 102.90 90.29 92.20

Brent US$/bbl 96.00 110.71 116.81 111.98 107.40 118.29 104.85 109.37

a Commercial sales plus field and plant usage. b This is a minimum level and includes only direct sales by the oil industry. The data do not include volumes sold to distributors etc. that are subsequently used or sold for automotive use. c Includes automotive diesel oil and industrial and marine diesel fuel. d Energy Quest. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; Department of Resources, Energy and Tourism, Canberra; Energy Quest; US Department of Energy, Energy Information Administration.

89

Table 34: Petroleum production, by basinTable 34 habitually contains production statistics for crude oil, condensate, LPG, ethane and natural gas by basin on a quarterly and annual basis. Data for this table are sourced from the Australian Petroleum Statistics, which are collected via voluntary industry reporting by the Department of Resources, energy and Tourism.

The Department of Resources, energy and Tourism and ABARES conducted a review of the Australian Petroleum Statistics that identified issues affecting the coverage and quality of petroleum data. The Department of Resources, energy and Tourism is currently liaising with industry to resolve data-reporting issues and improve the coverage of the Australian Petroleum Statistics. Table 34 will be updated once these issues are resolved.

Table 35: Sales of petroleum products, by state marketing areaNSW a Vic QLD WA SA Tas NT AustML ML ML ML ML ML ML ML

September quarter 2012LPG bAutomotive use c 128 200 42 39 50 3 2 463Total 292 349 152 79 91 16 8 986Automotive gasolinePremium unleaded 303 109 113 60 21 12 6 622Regular unleaded 423 942 709 381 261 74 26 2816Other unleaded d 812 150 224 52 32 4 0 1275Total 1538 1201 1046 492 314 91 32 4714of which sales to retailers 1342 1014 813 441 240 46 17 3912Aviation gasoline 3 3 5 4 2 0 3 21Aviation turbine fuel 855 293 410 233 65 4 67 1928Kerosene 0 1 1 0 0 0 0 2Heating oil 0 0 0 0 0 0 0 1Automotive diesel oil 1128 841 1795 1253 347 80 127 5572of which sales to retailers 475 379 406 253 89 9 17 1628Industrial and marine diesel fuel 0 0 0 0 0 0 0 0

Fuel oil e 42 25 45 32 0 2 0 147Lubricating oil and greases 22 16 27 17 7 1 1 91

Bitumen 38 24 70 9 9 2 0 152Other products f 48 6 3 2 2 0 1 62Total 3967 2760 3555 2122 838 196 240 13676

a Includes Australian Capital Territory. b Includes sales for petrochemical feedstock. c This is a minimum level and includes only direct sales by the oil industry. The data do not include volumes sold to distributors etc. that are subsequently used or sold for automotive use. d Includes proprietary brand and other blends. e Excludes refinery fuel. f Sales of LPG for petrochemical feedstock are included in LPG sales. p Preliminary.Source: Department of Resources, Energy and Tourism, Canberra.

Table 36: Phosphate2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pImports

90

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pQuantityPhosphate rockChina kt 0 1 0 0 1 0 0 0Morocco kt 288 183 80 55 98 0 31 64Nauru kt 74 72 34 0 42 0 30 30Togo kt 0 0 0 0 0 0 0 0Other kt 46 63 12 25 28 10 0 83Total kt 408 319 126 80 169 10 61 177PhosphatesDiammonium a kt 185 142 33 3 13 68 58 0Monammonium b kt 753 704 152 5 128 365 205 17

High analysis c kt 297 91 24 5 26 41 18 0ValuePhosphate rock $m 57 55 19 15 29 1 10 29PhosphatesDiammonium a $m 109 75 19 2 9 35 29 0Monammonium b $m 437 393 93 4 84 203 103 10

High analysis c $m 81 34 8 2 12 14 7 0Prices

Australia d A$/t 133.13 161.20 147.09 187.40 172.0

5 121.38 163.97 162.61

a P2O5 equivalent: 46 per cent. b P2O5 equivalent: 50 per cent. c P2O5 equivalent: 48 per cent. d Average import unit value. p Preliminary. na Not available.Sources: Australian Bureau of Statistics, Canberra; Queensland Government, Department of Mines and Energy; Government of South Australia, Primary Industries and Resources South Australia.

Table 37: Salt2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProduction s

Australia a kt 11562 11413 2494 3067 2957 2544 2844 2690

Exports sQuantity

Bulk, bagged and table kt 11162 10884 2595 2793 2802 2523 2766 2571

ValueBulk, bagged and table $m 251 245 58 63 63 57 62 58Prices sAustralia b A$/t 22.50 22.48 22.29 22.49 22.50 22.49 22.44 22.48

a Excludes Victoria. b Average export unit value. p Preliminary. s BREE estimate.Sources: BREE; ABARES.

91

Table 38: Silver2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionMine sSilver content of all minerals producedNew South Wales t 73 81 20 17 18 23 23 19

Queensland t 1483 1471 376 321 384 338 428 338Western Australia t 51 65 14 22 15 13 16 0

South Australia t 34 21 8 7 7 6 1 1Tasmania t 110 171 46 48 43 34 46 16Northern Territory t 42 53 12 14 13 13 13 14

Australia t 1792 1862 476 428 481 426 528 388RefineryRefined silver t 712 847 212 250 247 168 181 156ExportsQuantityRefined silver bullion t 198 269 7 41 44 56 127 65

ValueRefined silver a $m 164 268 10 48 42 57 121 60ImportsValueRefined silver bullion $m 490 950 254 572 187 93 98 104

Prices

World b USc/oz 2880 3321 3796 3898 3188 3263 2940 2980

Australia c A$/kg 920 988 1178 1128 948 992 885 920

a Includes refined bullion, powder, unwrought silver and semi-manufactured forms. b London Bullion Market Association, fixed rate. c Pasminco Metals, fob/fot Port Pirie. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; London Bullion Market Association.

Table 39: Tin2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionMineTin content of all minerals producedWestern Australia s t 12000 3150 3000 1500 1500 70 80 80

Tasmania t 6410 6052 1600 1600 1600 1426 1426 1426Australia s t 18410 9202 4600 3100 3100 1496 1506 1506Exports tQuantity

Tin concentrate t 12835 12259 2438 2538 3478 1859 4384 2954

Refined tin t 5 24 3 10 9 3 1 5

92

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pTin content of primary material exported as

t 5431 4909 1220 1244 1249 925 1491 1480

ValueTin concentrate $m 126 102 33 29 25 18 29 27Refined tin $m 0 1 0 0 0 0 0 0Total $m 126 102 33 30 25 18 29 27ImportsQuantityRefined tin t 673 593 146 187 127 190 89 115ValueRefined tin $m 18 13 4 5 3 4 2 2Prices

LME b US$/t 23960 20011 25400 23200 2210

0 17339 17404 17470

a Tin content of tin ores and concentrates and refined tin. b LME official close. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; London Metal Exchange.

Table 40: Titanium minerals2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProduction sIlmenite concentrateNew South Wales kt 90 90 23 23 23 23 23 23Queensland kt 186 186 47 47 47 47 47 47Victoria kt 87 100 26 26 22 37 16 25South Australia kt 173 156 46 46 43 46 21 39Western Australia kt 739 799 180 185 195 203 216 200Northern Territory kt 0 0 0 0 0 0 0 0Australia kt 1275 1331 322 326 329 354 322 333Leucoxene concentrateNew South Wales kt 134 162 41 41 41 41 41 41Victoria kt 10 10 3 3 3 3 3 3South Australia kt 0 0 0 0 0 0 0 0Western Australia kt 56 56 15 14 14 14 14 14Northern Territory kt 0 0 0 0 0 0 0 0Australia kt 200 228 58 57 57 57 57 57Rutile concentrateNew South Wales kt 80 80 20 20 20 20 20 20Victoria kt 235 194 59 60 50 34 51 46Queensland kt 75 74 19 19 19 18 18 18South Australia kt 27 68 15 19 16 17 17 16Western Australia kt 50 38 10 10 10 10 10 13Australia kt 467 454 122 127 114 98 115 113Synthetic rutile kt 542 480 129 118 123 105 135 120Titanium dioxide pigment kt 204 204 51 51 51 51 51 51

ExportsQuantityIlmenite concentrate a kt 1804 2045 496 518 527 492 508 512

93

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pLeucoxene concentrate kt 27 31 8 8 8 8 8 8

Rutile concentrate s kt 491 334 98 85 82 81 86 86

Synthetic rutile s kt 517 536 123 136 136 141 123 126Titanium dioxide pigment kt 195 179 53 51 41 51 37 27

ValueIlmenite concentrate a $m 198 225 55 57 58 54 56 56

Leucoxene concentrate $m 17 22 5 5 5 6 6 6

Rutile concentrate s $m 390 252 101 64 52 73 64 63

Synthetic rutile s $m 315 294 85 78 73 76 67 69Titanium dioxide pigment $m 527 571 152 164 127 153 127 81

Prices bIlmenite concentrate

Bulk s A$/t 110 110 110 110 110 110 110 110

Rutile concentrate

Bagged A$/t na 1939 624 685 638 643 648 653

Titanium dioxide pigment

A$/t 2708 3191 2850 3217 3134 3032 3437 3020

a From January 1992, bulk only. b Average export unit value. p Preliminary. s BREE estimate. na Not available.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra.

Table 41: Uranium2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionMineUranium oxide (U3O8) t 7069 7499 1185 2060 2014 1601 1824 2336

Uranium (U content)South Australia t 3724 3574 934 890 834 839 1011 930Northern Territory t 2270 2785 70 856 873 519 536 1051Australia t 5995 6359 1005 1747 1708 1358 1547 1981Exports asQuantityUranium oxide (U3O8) s t 6950 7499 1227 2060 2014 1601 1824 2336

ValueUranium oxide (U3O8) s $m 610 670 114 186 185 137 162 212

PricesUranium oxide (U3O8)Industry spot b US$/lb 57.13 51.50 55.75 51.00 51.83 51.67 51.50 48.17

94

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pAustralia cs A$/kg 87.71 89.34 92.57 90.12 91.72 85.76 88.97 90.61

a ABS confidentiality: no country details to July 2009 and no details from August 2009. b Average of weekly restricted spot price, published by The Ux Consulting Company. c Average export unit value. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; Department of Resources, Energy and Tourism; The Ux Consulting Company.

Table 42: Zircon2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProduction sZircon concentrateNew South Wales kt 70 86 21 21 21 22 22 22Victoria kt 197 188 53 58 59 35 37 34Queensland kt 40 60 10 15 15 15 15 15South Australia kt 249 273 71 93 69 67 43 0Western Australia kt 118 99 28 24 27 24 24 79Northern Territory kt 0 0 0 0 0 0 0 0Australia kt 674 706 183 211 191 164 141 150Exports sQuantityZircon concentrate kt 963 846 247 237 219 196 195 196

ValueZircon concentrate $m 532 327 143 117 87 60 63 59

Prices aZircon concentrateAll grades – bagged A$/t 1322 2325 1585 2162 2488 2272 2420 2392

a Average export unit value. p Preliminary. s BREE estimate.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra.

Table 43: Zinc2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pProductionMine sZinc ore and concentrates kt 2947 3361 820 879 847 788 847 790Zinc content of all minerals producedNew South Wales kt 102 121 28 29 32 28 31 41Queensland kt 1009 1031 268 255 262 253 261 214Western Australia kt 79 89 13 34 19 15 21 30South Australia kt 17 22 4 5 5 6 7 7Tasmania kt 92 107 23 26 27 23 29 16Northern Territory kt 181 199 48 52 49 48 50 48

95

2010–11

2011–12

2010–11

2011–12

2012–13

Jun Sep Dec Mar Jun Sep pAustralia kt 1479 1568 384 401 394 373 400 357Smelter and refineryRefined zinc (primary) kt 499 505 125 126 133 117 128 124Domestic despatchesRefined zinc kt 65 60 19 15 17 14 14 17ExportsQuantityZinc concentratesBelgium–Luxembourg kt 51 50 13 13 11 13 13 13China kt 973 948 187 269 359 145 175 188Germany kt 84 115 31 19 11 36 50 0India kt 44 53 10 9 9 11 24 28Japan kt 249 279 70 77 83 57 62 73Korea, Rep. of kt 316 446 119 101 99 117 129 95Netherlands kt 293 273 71 50 54 98 71 75Spain kt 234 200 92 57 0 56 87 57Thailand kt 64 40 25 0 21 10 9 19Other kt 9 0 0 0 0 0 0 40Total kt 2317 2405 617 594 647 542 621 589Refined zincChina kt 73 123 28 25 44 26 28 49Chinese Taipei kt 84 70 23 17 22 16 16 12Hong Kong, China kt 61 46 16 18 16 6 7 16India kt 6 5 2 1 1 1 2 1Indonesia kt 22 13 4 4 4 3 3 4Korea, Rep. of kt 8 0 0 0 0 0 0 2Malaysia kt 29 27 8 7 6 7 7 4New Zealand kt 11 9 3 2 3 2 2 3Saudi Arabia kt 6 6 2 0 1 1 3 3United States kt 73 133 20 20 20 48 45 20Other kt 38 24 17 5 6 5 8 8Total kt 410 456 121 100 122 115 119 121Zinc content of all primary materials exported as kt 1494 1583 411 372 423 374 413 387ValueZinc concentrates $m 1479 1386 389 350 381 302 353 290Refined zinc $m 893 917 263 217 245 218 236 217Total $m 2373 2302 651 567 625 520 589 508PricesLME cash b US$/t 2243 2018 2250 2224 1896 2022 1931 1885Australia c A$/t 2458 2162 2387 2327 2112 2094 2116 2023

a Zinc content of all ores, concentrates, slags, residues, intermediate products, refined zinc, zinc powders, flakes and dust. b LME cash, midday, registered brands, minimum 98 per cent, 25 tonne warrants. c EZ Industries, Prime Western, 98.5 per cent. p Preliminary. s BREE estimate. na Not available.Sources: BREE; ABARES; Australian Bureau of Statistics, Canberra; London Metal Exchange.

BREE contacts

96

Executive Director/Chief

Economist – BREE

Quentin Grafton [email protected]

(02) 6243 7483

Deputy Chief Economist/Research

Director

Roger Rose [email protected]

(02) 6243 7583

Resources Program – Program

Leader

John Barber [email protected]

(02) 6243 7988

Modelling & Policy Integration –

Program Leader

Arif Syed [email protected]

(02) 6243 7504

Energy and Quantitative Analysis –

Program Leader

Nhu Che [email protected]

(02) 6243 7539

Data & Statistics Program –

Program Leader

Geoff Armitage [email protected]

(02) 6243 7510

97







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