Mining has reached the bottom of the downturn and has begun its recovery, according to a new IBISWorld report.
The major commodities, across the board, have seen a revival in fortunes after shedding prices continually for the last few months, creating a horror year, causing revenue in the mining division to decline by 10.0% in 2014-15, to reach $211.8 billion.
Iron ore hit a four month high last week after dropping to all-time lows in in April, having now risen to more than 40 per cent of the trough since then.
Gold has also seen a slight rally over the last month, following weaker trading in Europe on the back of poor economic data from China, coupled with a slightly weaker US dollar.
“With the dollar now slipping again and with some of the other markets looking a bit [like they have reached unstable highs and are likely to decline], it may be that the precious metals look relatively cheap as a safe-haven asset class should investors feel the need for a haven,” William Adams, head of research at Fastmarkets, explained.
Coal, while not seeing dramatic price rises, is again seeing some positive turns from emerging markets.
According to NSW Minerals Council CEO Stephen Galilee exports to Korea have risen by eight per cent, while exports to Taiwan are up 21 per cent.
Meanwhile, across the rest of Asia outside of Japan and China, coal exports have more than doubled to 15.6 million tonnes over the last nine months.
“We are also seeing the rise of India as a new growth market for the quality NSW thermal coal, with exports to the country doubling so far over this financial year,” Galilee said.
Figures released by Coal Services show that in the last nine months to 31 March 2015 exports of NSW coal to India have doubled from 3.2 million tonnes to 7.7 million tonnes, highlighting the market opportunities for our state’s largest commodity export on the subcontinent.
In the latest IBISWorld report, it forecasts a revival for the industry in 2015-16, as the mining sector recovers from a global oversupply and the corresponding fall in prices.
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