Beyond China: potential trading partners for Australian minerals
As Australian-Chinese trade relations cool, Australia will need to look further afield for destinations for its mineral exports. JP Casey profiles some of the most likely trading partners.
hina has long been the destination of choice for a range of Australian mineral exports, most notably coal and iron ore, but this relationship has been challenged in recent years. With tensions frayed by Australia calling for an inquiry into China as a potential source of the Covid-19 virus, and Australia eager to add balance to its exports, Australian mines are having to find new buyers for their products.
This is not to say that Australia has cut China off from its minerals entirely. In 2021, Australia exported 705 million tonnes of iron ore alone to China, orders of magnitude more than any other country.
However, this total was lower than the 735 million tonnes shipped in 2020. Between these two years, Australian iron ore sales to Japan, South Korea, Taiwan, Vietnam and Indonesia all increased, suggesting that, however slowly, Australia is beginning to shift its mineral exports away from China.
This trend is even more apparent in coal. Figures from the Australian National University estimate that, by 2025, Chinese coal imports will fall by 26%-45%, with Australian thermal coal imports expected to fall to as low as 30 megatons by 2025, down from 50 megatons in 2019. With iron and coal exports a key component of the Australian economy, now may be the time for miners to look for new trading partners.