Mining will continue says forecaster
That was the message on the future of mining and resources investment on Monday from economic forecaster BIS Shrapnel's chief economist Dr Frank Gelber.
Dr Gelber released new forecasts on the nation's economy confirming mining growth was slowing, down from the incredible heights of the peak about two years ago.
The growth, the report said, was mostly in mining, and while most other industries were still waiting for a recovery, it was on the way.
The report showed mining investment would continue to underpin investment activity as other sectors - including housing and commercial construction - prepared to pick up the slack partly on the back on historic low interest rates, population growth and housing shortages in the eastern states.
"As mining investment peaks in 2014, and starts to decline, non-mining investment will stabilise and start to pick up, taking over as the engine of growth, and smoothing the transition," the report reads.
Dr Gelber said despite the mining boom peak having passed, the construction of at least five major projects in Queensland was yet to begin, confirming the sector would underpin the state's economy for years to come.
He said other industries, including health, wholesale trade, education and retail trade, were either steady as she goes or about to stabilise.
The outlook for industries with strong links to the Australian dollar, including manufacturing, electricity, gas and water, were expected to remain subdued due to the high dollar.
Dr Gelber said as the broader economy began its recovery from the global financial crisis, the demand for administration services and office space would gradually rise.
"There are enough underlying drivers of growth to underpin activity over the next few years," he said.
"Over time, we will run into capacity constraints, which will prompt a broadening of investment beyond mining.
"This will produce a steady transition as the mining investment boom runs its course."
COMMODITY FORECASTS for 2012-13:
Iron ore: volume +10%, value +7%
Metallurgical coal: volume +13%, value -2%
Gold: volume +9%, value +27%
Thermal coal: volume +13%, value +7%
LNG: volume +21%, value +29%
Copper: volume +10%, value +7%
Alumina: volume +15%, value +30%
Aluminium: volume -9%, value -12%.
SOURCE: BREE, Resources and Energy Quarterly, June, 2012.