Mining Industry and Resource Boom in Australia

Running head: MINING INDUSTRY AND RESOURCE BOOM IN AUSTRALIA
Mining Industry And Resource Boom in Australia
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MINING INDUSTRY AND RESOURCE BOOM IN AUSTRALIA1
Executive Summary
The report evaluates dynamics of mining industry in Australia. Mining industry is one of most
vital sectors of the economy. The industry though undergone several ups and downs, the
resources boom sustained for a considerably long period. The importance of mining sector
can be evaluate in terms of its contribution in GDP, employment and export. Mining industry
in Australia is a highly concentrated industry with large firms controlling majority of market
share. The resource boom initially started in 2003. Increase in global commodity prices.
Favorable terms of trade and exchange rate all led to a rapid growth of the sector. There was
a significant growth in output of mining and associated business sector. Increased investment
in mining sector resulted in an increase in productivity and employment of the sector.
Government of Australia took appropriate policy measure to stabilize the mining industry and
the entire economy.

MINING INDUSTRY AND RESOURCE BOOM IN AUSTRALIA2
Table of Contents
Introduction.................................................................................................................................3
Background of mining industry...................................................................................................3
Market structure..........................................................................................................................5
Resource boom in Australia from 2003 to 2016.........................................................................5
Impact of resource boom............................................................................................................5
Mining industry........................................................................................................................5
Australian economy.................................................................................................................7
Government policy......................................................................................................................8
Conclusion..................................................................................................................................9
List of References.....................................................................................................................10

MINING INDUSTRY AND RESOURCE BOOM IN AUSTRALIA3
Introduction
In Australia Mining is regarded as one of the important primary sectors making
significant contribution to Australian economy in terms of providing export income,
employment and royalty income. Since a very long period, expansion of mining industry has
significantly encouraged growth of population through immigration. This was particularly
prevalent in 1850s due to gold rushes. Different types of ores, gems and precious minerals
have been mined since several past years (Marcos-Martinez, Measham and Fleming-Munoz
2019). A large variety of metals are still mined across the nation. A significant portion of
minerals that are mined is exported to different nation without much making much processing
within the nation. Mining is an early source of export earnings which is further used to pay for
imports. Primary minerals and other mining resources of Australia include Iron ore, Nickel,
Copper, Aluminium, Gold, Copper, and Silver, Uranium, Diamond, Zinc, Opal and others
(ig.com 2019). The report studies mining industry of Australia particularly the resource boom
that the economy experienced from 2003 to 2016. This was the largest resource boom that
the economy experienced ever. The resource boom not only helped to flourish mining
industry but also made considerable contribution to overall economic prosperity.
Background of mining industry
The mining industry in Australia dates back to gold rushes during 1850s’ is one of the
most well-established sector of the nation. The industry contributes a significant portion of
GDP of the nation with the share being 7 percent. Mining industry in Australia is largely export
oriented with minimal processing done in onshore. It is since 2007-08 that mining has
accounted nearly 50-60 percent of national export. Australia is counted among the top five
producers of iron ore, gold, lead, nickel and zinc. In 2016, there were nearly 370 operating
mines in Australia (Eklund 2015). One third of the mines is located in Western Australia, one
quarter is located in Queensland, and one fifth are in New South Wales. These are the three
most important mining states of Australia.
The industry experienced a period of sustained growth from 2005 to early 2013. During
the expansionary phase there was a significantly strong growth in investment and other
investment projects. During this time value of mining industry has increased to $147 billion in
2012 from $24 billion in 2003 (Ellem and Tonts 2018). The sharp increase in industry growth
was mainly resulted from expansion of mineral export especially coal and iron ore. The mining
boom however is over now causing the industry to lose its value to some extent. The figure
below shows historical trend in value of mining industry.