Mining sector now SA's leading exporter

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Mines hold off wines
Article from: The Advertiser

NIGEL AUSTIN

August 07, 2007 02:15am

THE mining sector has narrowly retained its position as South Australia's leading exporter, despite a strong performance by the wine industry.

Wine exports grew by $200 million to a record $1.747 billion in 2006-07 as confidence returned to the sector.

Mineral exports climbed by only $21 million after jumping by almost $500 million during the previous year.

Australian Bureau of Statistics figures, prepared exclusively for The Advertiser, show that overall SA's exports reached $8.7 billion, down from $9.02 billion in 2005-06 – with the drought, the high Australian dollar and vehicle changeovers hitting the final figure.

The strong surge in the state's wine exports comes as Australian wine shipments appear likely to soon reach a record $3 billion in a 12-month period.

Australian Wine & Brandy Corporation manager (information and analysis) Lawrie Stanford said bulk wine shipments were falling rapidly while bottle shipments were recovering.

"The driver is shipments of red wine; not only is the change in the mix having a positive impact on the value of sales but also the prices for our bottled shipments are on the rise," Mr Stanford said.

"We anticipate bulk shipments will continue to dry up and prices will turn around.

"People are anticipating shortages from the low harvest and the industry is focusing on our high-end products."

SA Chamber of Mines & Energy chief executive Jason Kuchel said the next big lift in mineral exports was expected to start in 2008-09.

"We have had an exploration boom, but the mining boom has yet to start," Mr Kuchel said.

"We had four mines in 2000, but there are expected to be 40 mines by 2020.

"Based on that, mining exports are going to rise a lot in the next decade and are likely to be four to five times larger conservatively by 2020."

Council of International Trade and Commerce SA chairman Nick Begakis said the rising Australian dollar and the drought had clearly affected some sectors. He said the decline in exports also reflected SA's mix of industries.

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Mines holds off wines

as SA's biggest earner

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The major casualty in 2006-7 was the car sector, with exports dropping by $450 million to $985 million.

A GM Holden spokeswoman said the fall in exports was partly due to a changeover in models to the new VE Commodore range.

Two export programs had also ended – the export of the Pontiac GTO to the U.S. and export programs to both China and South Korea.

She said the high Australian dollar was having an impact but the outlook was strong, with a new export program to begin late this year.

It will involve a very significant program in exporting Holdens to the U.S. as rebadged Pontiacs while the carmaker will also start exporting to Korea again next year.

The spokeswoman predicted that 50 per cent of all cars built at GM Holden's Elizabeth plant would be driven on foreign roads by the middle of next year.

The ABS figures show exports of oil and seafood were down slightly last year while the drought pushed wheat exports down by more than $100 million.

The meat industry was another strong performer, reaching $490 million in shipments, while wool rose to $184 million due to higher prices.

Machinery sales also increased slightly, to $409 million.