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Varying prospects for northern Australian commodities

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26 October 1999

Varying prospects for northern Australian commodities

‘Better US dollar prices are in prospect for some key minerals and energy commodities^, Mr Roger Rose, AB ARE’s Industries Research Director said at the Northern Australian Regional Outlook Conference in Darwin today. The improved outlook for minerals and energy commodities is driven by stronger world economic growth and substantial * production cuts in a range of industries.

For agricultural commodities, prices are expected to remain subdued in the short term. The Australian saleyard indicator price for beef is forecast to average around 200 cents a kilogram (dressed weight) in 1999-2000, an increase of only 2.6 per cent from the previous year.

‘After slumping in the past two years, Australian exports of live cattle to South East Asian markets are showing signs of improvement as economies in that region begin to recover’, Mr Rose said. Overall live cattle exports are forecast to rise by 25 per cent in 1999-2000, following a fall of 38 per cent over the previous two years.

‘Higher beef prices combined with good seasonal conditions provided northern live cattle export producers with opportunities to lessen the impact of the downturn in the live cattle trade by selling cattle on the slaughter and store markets, or by retaining live cattle previously destined for live export for later sale on slaughter markets’, Mr Rose added.

AB ARE’s Senior Analyst, Industries Branch, Mr Andrew Maurer, also spoke at the conference on the mining sector performance and outlook.

‘The short term outlook for the northern Australian minerals and energy sector is positive, with local producers well placed to benefit from both rising demand and prices stemming from recovery in Asian economic growth’, Mr Maurer said.

Over the medium term, the outlook for the northern Australian minerals and energy sector remains positive, with demand for most commodities projected to increase significantly over the coming five years. A number of large new minerals and energy facilities have recently been commissioned or are at the final stages of construction and they will make

significant contributions to the future growth of the sector’, Mr Maurer added.

The Northern Australian Regional Outloook Conference, jointly hosted by ABARE and the Northern Territory Government’s Office of Resource Development, focused on commodities and community benefits. Speakers today included Mr Bruce Wallace, Senior Trade Commissioner, Austrade, Jakarta, who addressed delegates on export challenges for northern Australia into the new millenium and Ms Carole Frost, General Manager, NT Chamber of Commerce, who spoke on local business benefits from primary resource developments.

For further information contact: Yvonne Kingsley, ABARE, telephone 0418 675 401. Graeme Atherton, Office of Resource Development, telephone 0418 859 822.

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