However, the long-term outlook for the Australian coal industry remains highly uncertain. Generation from renewables continues to increase, large resource companies are increasingly divesting or announcing closures of their coal assets, and financial institutions have pledged no new investment in the sector, citing concerns about its future demand and global warming.
Benchmark prices for high-quality thermal coal traded at the Port of Newcastle are expected to drop from $360 to $200 a tonne by 2024, but are not expected to return to pre-coronavirus levels in “any foreseeable time frame”, thereby reduce its competitiveness.
“Thermal coal continues to face financial, insurance, and long-term global demand challenges, all of which make the supply-side response slow and difficult to manage,” the federal trade report said. “These factors are likely to become more potent over time.” , putting the industry into a phase of permanent high prices.”
Earnings from Australia’s other major energy commodity export, liquefied natural gas (LNG), were revised up by $1 billion for the financial year. Export revenue is now expected to reach $90 billion, up from $71 billion a year ago.
Earnings from iron ore, the main steelmaking raw material often ranked as the nation’s most valuable commodity, were revised down this fiscal year and are expected to slip to $113 billion from $130 billion in the previous fiscal. The COVID-19 outbreak and a slowdown in the property market in China, by far Australia’s largest customer for iron ore, continue to dent demand for steel.
At the same time, the demand for Australia’s raw material supplies to build clean energy technologies, including copper, nickel and lithium, will reach almost $33 billion in 2022-23, compared with $22 billion in 2021-22. The demand will increase.
As the clean energy revolution and electric vehicles accelerate, federal Resources Minister Madeleine King says Australia’s lithium revenues are expected to grow more than tenfold in two years, from $1.1 billion in 2020-21 to $1.9 billion in 2023-24. $17 billion, making it Australia’s sixth largest resource and energy export.
“These materials, along with other key minerals and rare earths, are critical to low-emissions technologies such as batteries, solar panels and electric vehicles, and will help Australia and the world meet their commitment to net zero emissions by 2050,” she said.
King said the figures underscored the importance of the resources sector, which accounts for about 10 percent of gross domestic product (GDP) and directly employs more than 250,000 people, at a time of slowing global growth.
The Business Briefing newsletter features breaking stories, scoops and expert opinion. Sign up to get it every weekday morning.