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Australia Mining Report
Australia Mining Report
Executive Summary
You have downloaded a PDF of BMI's latest views on the market, summarising the key findings that are
assessed in detail in the new report, as well as the full report Table of Contents.
Find out more about this report by contacting one of our experts on +44 (0) 20 7246 1374
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Industry Forecast
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Risk/Reward Ratings
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Market Overview
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Regulatory Development
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Commodities Forecast
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Iron Ore
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Steel
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Aluminium
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Copper
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Lead
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Nickel
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Tin
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Zinc
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Competitive Landscape
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Company Profile
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BHP Billiton
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Rio Tinto
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Minmetals Resources
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Xstrata
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Regional Overview
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Asia Overview
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Methodology
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BMI View: With China's economy on course for a rude slowdown over the coming years, Australia's mining sect or is
set to suffer the painful spillover effects of a sharp investment slowdown. Already, the mining sector is feeling the
crunch of plummeting commodity prices as a string of miners scale back their ambitions and slam the brakes on
investment. W e forecast Australia's mining sector value to reach US$187bn by 2018 , growing at an annual average
rate of 4.0 % over our forecast period. This contrasts wit h an average growth rate of 21.7 % per annum over the past
decade.
Australia has been among the biggest beneficiaries from the China-led commodities boom over the past
decade, attracting huge amounts of investment into the minerals space. Driven by China's voracious appetite
for key commodities such as coal and iron ore, the value of Australia's mining industry had increased by more
than six-fold from US$24bn in 2003 to US$147bn in 2012. As a result, this has seen the sector's share of GDP
rising from 4.5% to 9.6% over the same period. However, we believe the boom years in the mining industry is
over. With China's economy on course for a rude slowdown over the coming years, Australia's mining sector is
set to suffer the painful spillover effects of a sharp investment slowdown.
Boom Is Over
Australia - Mining Industry Value
We believe Australia will be the biggest loser from the mineral imports shift in China ( see 'Minerals Import
Squeeze: Bittersweet Outcomes', July 17 , 2013). The latter commands a prominent role in Australia's exports of
key commodities including coal and iron ore. Already, the mining sector is feeling the crunch of plummeting
commodity prices as a string of miners scale back their ambitions and slam the brakes on investment. The
rising tide of economic nationalism, declining labour productivity and aggressive minimum wage legislation will
compound the challenges in the mining industry, amplifying the downshift in Australia's economy going
forward ( see 'Tough Times Ahead, What Can Replace The Mining Boom', May 03 , 2013). We expect the value of
Australia's mining sector to reach US$187bn by 2018, growing at an annual average rate of 4.0% over our
For more information, please contact us at: lyndsey.anderson@businessmonitor.com
+44 (0) 20 7246 1374
forecast period. This contrasts with an average growth rate of 21.7% per annum over the past decade.
Heavy Chinese Exposure
Australia - Exports of Iron Ore (LHS) & Coal (RHS) By Country
Despite the fading of the mining boom, Australia will remain a leading player in many segments of the global
mining industry given its rich deposits of minerals including iron ore, nickel, bauxite, copper, gold, uranium,
diamonds, zinc and coal. Moreover, Australia's mining sector is one of the most business-friendly in the world,
with domestic companies and overseas miners operating in the country. We expect Australia to remain a
highly attractive destination for foreign investment, despite the introduction of a 30% super profits tax on coal
and iron ore miners on July 2012. The proposed tax will not significantly affect the country's mining sector as
these concerns are likely to be outweighed by Australia's rich mineral wealth.
Key Players
Given its vast potential and high quality of infrastructure, Australia is home to some of the biggest players in
the global mining industry. Multinationals operating in the Australian mining industry include Australian
companies BHP Billiton and Newcrest Mining and large overseas miners such as Rio Tinto, Norilsk Nickel and
Xstrata. We believe the mining industry is set to witness a wave of consolidation activity over the coming
quarters as a growing number of miners come under pressure from weakening mineral prices.
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To find out more about how the extensive views, analysis and forecasts contained in the full report will
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