Report shows healthy investment in WA resources
The December edition of the WA Resources and Economics Report, released by the Chamber of Minerals and Energy of Western Australia (CME), shows that the resources sector is continuing to display strong growth.
CME Chief Executive Reg Howard-Smith said that a number of projects in the pipeline would continue to facilitate strong investment growth and employment demand.
“A number of major projects are expected to begin production over the next two years, while demand for iron ore and natural gas remains very strong,” Mr Howard-Smith said.
“Labour demand in the WA resources sector has contributed to the lowest unemployment in the country at 4.3 per cent and direct employment in the resources sector cracked the 100,000 mark for the first time in December.”
“Growth in exports is forecast at a rapid pace of 8.56 per cent in 2011/12, with even stronger growth expected in 2012/13, in line with higher production of LNG over the medium term.”
The largest increases in production were recorded for iron ore (8.9 per cent) and titanium minerals (22.6 per cent). However the average export unit value of iron ore fell 5.8 per cent during the quarter and marks the second consecutive quarter in which the export unit value has fallen.
The report found that the European debt crisis had sparked a surge in demand for gold, which Mr Howard Smith described as a ‘sensible bet’, with the gold price increasing by 14.1 per cent during the quarter.
The CME report also indicates a resurgent growth in uranium exploration, which rallied with a 28 per cent growth after the fallout from the Fukushima nuclear incident.
Other key findings in the December 2011 WA Resources and Economic Report:
- The WA resources sector continues to out-perform the All ASX and S&P/ASX 300 indexes
- Mineral exploration accounted for almost half of the total $970million exploration expenditure in WA, rising by 7 per cent to $482million
- Gross State Product is expected to grow to 4.3 per cent in 2011/12, climbing to 6 per cent in 2012/13 and 2013/14
- At the end of October 2011, there were 40 projects at an advanced stage of development in WA. Total capital expenditure on these projects was at a record $147.5billion – an increase of $38billion or nearly 35 per cent from April 2011
The full report can be found here