Record $379bn earnings forecast for resources, energy export

20 December 2021
The Hon Keith Pitt MP
Minister for Resources and Water

The reputation of Australia’s resources and energy sector as a key driver of jobs and economic growth has again been confirmed in the latest export forecasts, which put the industry on track for a new record.

Resource and energy export earnings are forecast to reach a staggering $379 billion in 2021–22 as demand for our coal and gas surges in the face of a global energy shortage.

The December edition of the Resources and Energy Quarterly (REQ) from the Department of Industry, Science, Energy and Resources found that high commodity prices, good volume growth and a weak Australian dollar are driving a surge in export earnings.

Minister for Resources and Water Keith Pitt said that the resources sector once again has been shown to be the bedrock of the Australian economy and would strongly support the nation’s future growth.

“The resources sector has risen above the challenges of the pandemic and will continue to deliver for our nation in the years ahead,” Minister Pitt said.

“In 2020–21 our resources and energy earnings passed $300 billion for the first time, reaching $310 billion, and are now forecast to top that by $69 billion in 2021–22.

“These are outstanding results that will provide further jobs and opportunities in our regions and benefit all Australians.

“Hundreds of new projects in the pipeline, including 60 new or expanded coal mines, will deliver thousands of new jobs, especially in regional areas.

“The higher forecast earnings are expected to keep the benefits flowing to the broader community, including through royalties the states use to pay for the hospitals, roads and schools, the services we all rely on.

“The Queensland Government last week announced a $2.9 billion boost from coal royalties alone. This is money that can build hospitals, buy medical equipment and fund more nurses as the state opens up from COVID.

“Australia is set to benefit from a global shortage of energy, with record earnings from thermal and metallurgical coal and LNG.

“Coal is the star performer. Australia’s high-quality coal is finding new markets across Asia, including India, with Australian producers enjoying record price increases across all grades of coal.”

Thermal coal export values are expected to rise from $16 billion in 2020–21 to $35 billion in 2021–22. Earnings are likely to fall back to $27 billion in 2022–23.

Metallurgical coal exports are expected to rise from $23 billion in 2020–21 to more than $50 billion in 2021–22.

However, export earnings from iron ore are expected to fall from a record $153 billion in 2020–21 to $118 billion in 2021–22, and ease further to $85 billion in 2022–23.

Lithium, nickel and copper export earnings are expected to rise over the next two years, supported by higher prices, new energy technology take-up, and increased production.

Australia’s LNG exports earnings are forecast to rise from $30 billion in 2020–21 to $63 billion in 2021–22, before settling back do $55 billion in 2022–23 as oil-linked contract prices ease.

The Resources and Energy Major Projects 2021 (REMP) report, released at the same time as the REQ, shows a very positive outlook for the development pipeline of resource and energy projects.

Minister Pitt said that the 367 projects included in the report had an estimated value of $504 billion, with hydrogen, ammonia and carbon capture and storage projects accounting for $185 billion worth of investment and gold emerging as a new growth industry.

“This means jobs for Australians,” Minister Pitt said.

“Job estimates from proponents of committed projects suggest around 25,100 construction jobs and 8,300 ongoing jobs will be created. The majority of these jobs will occur in regional Western Australia and Queensland.”

The REMP report noted that more than $11 billion had been committed to oil and gas/LNG projects in the 12 months to October 2021.

The latest Resources and Energy Quarterly and the Resources and Energy Major Projects 2021 report are available on the Department of Industry, Science, Energy and Resources website.

Media contact: Minister Pitt’s office 02 6277 7180