COMMODITY PRICES ADJUSTMENT
Recorded trade exports data presented for recent months in tables 12-15 of this publication are based on information initially reported by exporters to the Australian Customs Service (ACS). At the time of initial reporting to ACS the final prices may not be known for some commodities. Therefore, the information recorded for recent months for commodities like iron ore and coal can include a variety of prices including previous or current contract prices and the prevailing spot prices. New contract prices that have been recently negotiated, or are still being negotiated, are not fully reflected in the data first reported to ACS. As with commodity price changes in previous years, it is expected that the decreased prices resulting from the negotiation of new contracts will be updated progressively in revised information reported to ACS and then reflected in recorded trade data.
The balance of payments data in this publication for April and May 2009 include adjustments for the anticipated price decreases for iron ore exports from April 1. As progressive revisions to the recorded trade prices are reported to ACS and then provided to the ABS they will be incorporated into the balance of payment series and the adjustments reduced accordingly.
The balance of payment series has been reduced by a $75m adjustment to both April and May 2009. In the unadjusted recorded trade series, the value of iron ore and concentrates decreased by 18% between March 2009 and May 2009 with prices down 29%. In the adjusted balance of payment series, the value of the comparable item decreased 20%, with prices down 31%.
On a recorded trade basis, the May 2009 prices for metallurgical coal fell 27% compared to April 2009 and 40% compared to March 2009. Similarly, May 2009 prices for non-metallurgical coal (bituminous coal) fell 9% compared to April 2009 and 25% when compared to March 2009. Because of these falls in price, and historical patterns showing that adjustments to coal prices occur progressively, no adjustments have been made to the balance of payments series. This will be reviewed as future data are observed.