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Increasing electric vehicle production is also expected to affect the prices of critical minerals, including lithium.
“In addition to using about 9 kilograms of lithium, the average light EV requires around 200 kilograms of other key minerals and metals … about six times the volume used in a car with an internal combustion engine,” the report said.
The forecast of record earnings in 2021-22 is 33 per cent higher than the record $320 billion made last financial year from Australian exports including gas, nickel, iron ore, coal and steel.
But rising global inflation is expected to put downward pressure on commodity prices, with prices projected to ease to $370 billion in real terms in 2022-23 and then steady out between $263 billion and $293 billion over the following years to 2026-27.
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“Prices are likely to hold at relatively strong levels in the short term but decline from 2023, as demand falls back and supply expands,” the report said.
In Tuesday’s budget, Treasury assumed commodity prices will return to more consistent levels by the end of this year’s September quarter.
“Nonetheless, the recent strength in export prices will see Australia’s terms of trade reach a record high in 2021-2022. This will support strong profitability in the mining and agricultural sectors, with some positive flow through to the broader economy and to revenue,” the budget’s economic outlook said.
Mr Frydenberg said the government was saving some of the unexpected windfall to help the bottom line.
“We have drawn clear lines [and] banking the dividend of a stronger economy,” he said.
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Australian resources revenue booms, but it’s not predicted to last
Source: Philippines Alive
