Australia’s iron ore export earnings are forecast to decline to A$114 billion in 2024-25 from A$138 billion in 2023-24 and to A$102 billion in 2025-26, due to lower prices over the outlook period, according to the quarterly outlook report by the Australian government’s Department of Industry, Science and Resources.
The export earnings forecast for the fiscal year 2024-25 has been revised up from A$107 billion in the previous report, reflecting inventory restocking and improved demand sentiment, given strengthening forward indicators of Chinese industrial production.
Iron ore prices stabilized in the June quarter on the back of a slowing of the rapid build-up of iron ore inventories as well as improved sentiment due to both a strengthening of forward indicators of Chinese industrial production and a series of Chinese government measures to support China’s economy. After falling to a low of around US$95/mt in late March this year, the benchmark iron ore spot price has stabilized at US$107/mt on average.
The report pointed out that the benchmark iron ore price is projected to fall to an average of US$96/mt in 2024 and then decline further to US$84/mt in 2025 and to around US$77/mt in 2026.
