(Bloomberg) – Australia’s resource industry is set to aid the economic recovery once again as higher prices and expansion plans assist the nation emerging from its coronavirus lockdown.
Mining accounts for nearly 6% of gross domestic product but plays an outsized role in national income, delivering dividends to pension funds and funds for government coffers. Iron ore, the nation’s biggest export, has broken $100 a ton amid off-shore supply concerns, providing a timely budget boost.
The government’s most recent budget numbers from December were based on iron ore falling to $55 a ton, excluding freight, by the June quarter of 2020. The government gains around A$3.7 billion for every $10 in excess of this estimate in the year to June 2021, which will assist the budget position following the massive fiscal injection. Continue Reading →