(Adds bureau comment in fourth paragraph.)
June 21 (Bloomberg) -- Australia, the world’s largest shipper of coal, iron ore and wool, raised its forecast for export earnings 2 percent to a record for the next fiscal year, driven by expectations of higher production and export prices.
Sales may total A$256.3 billion ($272 billion) in the 12 months to June 30, 2012, the Canberra-based Australian Bureau of Agricultural & Resource Economics & Sciences said in a report today. That compares to its March forecast of A$251.3 billion and a revised prediction for the current year of A$217.8 billion.
Rising incomes and economic growth in emerging markets including China and India are fueling demand for energy, metals and farm products, helping drive prices higher. The Standard & Poor’s GSCI Index of 24 raw materials has rallied 5.6 percent this year as commodities from silver to corn advanced.
“Forecast increases in export prices and shipments for Australian iron ore and metallurgical coal are the main reasons for the expected increase in mineral resources exports,” Kim Ritman, acting deputy executive director at the bureau, said in a statement. Higher production and prices will boost farm exports, offsetting the stronger Australian dollar, he said.
Earnings from energy and mineral exports are expected to reach A$218.3 billion, compared with a March forecast of A$214.6 billion and A$182 billion a year earlier, the agency said.
The value of Australia’s farm exports is forecast at A$34.1 billion next fiscal year, up from A$32.5 billion in the March outlook and compared with A$32 billion this fiscal year, according to the report.
The bureau raised its Australian dollar forecast to $1.01 from 97 cents in its March outlook. The local currency has gained 3.6 percent this year and touched $1.1012 on May 2, the strongest since it was freely floated in 1983, as surging demand from China and India boosted sales of the nation’s commodities.
Australia’s economy will recover faster than anticipated from last quarter’s contraction driven by a record mining boom, Finance Minister Penny Wong said June 17. The economy will be underpinned by a A$430 billion pipeline of investment in minerals and energy, she said.
--Editor: James Poole
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