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Australia’s mining sector returning to strong growth: Increasing commodity prices and stabilizing export markets boost the sector
The Australian mining sector is said to have witnessed a boom from 2003 onwards, as demand from China, Japan and other major Asian markets surged as a consequence of strong growth. Simultaneously this strong demand boosted commodity prices, resulting in large profits for the Australian mining sector.
However as growth in the Australian mining sector’s largest export market China has decelerated in recent years and fears of stronger decreases in the future emerged, the Australian mining sector has taken a hit. Another major export market Japan too suffered financial instability and recessions in the aftermath of the Fukushima nuclear disaster. Commodity prices have fallen in recent years as a consequence of lower demand from these major metals and mineral importing nations.
However in 2017, positive news seems to be returning to the Australian mining sector, as growth in China despite decelerating has remained strong. Forecasts for the near future also suggest lower than past but nevertheless consistent and strong growth rates in China. The financial situation in Japan too seems to be stabilizing, and importantly for the Australian mining sector, the incumbent Japanese government is seeking a return to using nuclear energy for the purposes of generating electricity. This is positive news for Australian uranium exporters.
Meanwhile prices for major commodities such as iron ore, coal and gold which Australia exports in large numbers are rebounding in 2017 again as demand surges, driving up profits for players in the Australian mining sector.