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5625.0 - Private New Capital Expenditure and Expected Expenditure, Australia, Jun 2005  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 01/09/2005   
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JUNE KEY FIGURES

Jun Qtr 05
Mar Qtr 05 to Jun Qtr 05
Jun Qtr 04 to Jun Qtr 05
$m
% change
% change

Trend estimates(a)
Total new capital expenditure
15,397
3.7
18.2
Buildings & structures
4,752
3.8
18.2
Equipment, plant & machinery
10,599
3.3
17.5
Seasonally adjusted(a)
Total new capital expenditure
15,578
7.3
17.0
Buildings & structures
4,784
2.3
16.0
Equipment, plant & machinery
10,894
12.7
18.5

(a) In volume terms.

New Capital Expenditure, in volume terms
Graph: New Capital Expenditure in Volume Terms



JUNE KEY POINTS


ACTUAL EXPENDITURE (VOLUME TERMS)
  • The trend estimate for total new capital expenditure increased by 3.7% in the June Quarter 2005. It rose 7.3% in seasonally adjusted terms after a small fall (down 0.9%) in the March quarter 2005.
  • A strong increase in seasonally adjusted expenditure on equipment, plant and machinery (up 12.7%) has been the major contributor to growth this quarter, mainly driven by the Mining and Transport and Storage industries.
  • Seasonally adjusted expenditure on buildings and structures also increased this quarter (up 2.3%) due mainly to expenditure by the Mining industry.
  • The original estimate for 2004-05 increased 13.4% compared to 2003-04.


EXPECTED EXPENDITURE (CURRENT TERMS)
  • This issue includes the seventh estimate for 2004-05 and the third estimate for 2005-06.
  • Estimate 7 for 2004-05 is $57,406m. This estimate is 12% higher than the comparable estimate for 2003-04 and 1% lower than Estimate 6.
  • Estimate 3 for 2005-06 is $56,629m, which is 15% higher than the comparable estimate for 2004-05 and 16% higher than Estimate 2.
  • See pages 6 to 9 for further commentary on expectations data.


NOTES

CHANGES IN THIS ISSUE

A new base year, 2003-04, has been introduced into the chain volume estimates which has resulted in revisions to growth rates in subsequent periods. In addition, the chain volume estimates have been re-referenced to 2003-04, thereby preserving additivity in the quarters after the reference year. Re-referencing affects the level of, but not the movements in, chain volume estimates.



INQUIRIES

For further information about these and related statistics, contact the National Information and Referral Service on 1300 135 070 or Fiona Cotsell on Sydney (02) 9268 4357.



ACTUAL NEW CAPITAL EXPENDITURE IN VOLUME TERMS


TOTAL CAPITAL EXPENDITURE

The trend estimate for total new capital expenditure increased 3.7% in the June quarter 2005, the fourth quarter of similar growth. There was a strong seasonally adjusted increase this quarter of 7.3% which was mainly driven by equipment expenditure in the Mining and Transport and Storage industries.

Graph: Total Capital Expenditure, CVM



BUILDINGS AND STRUCTURES

The trend estimate for buildings and structures increased 3.8% this quarter, after two quarters of stronger growth. In seasonally adjusted terms, the estimate increased 2.3% following strong growth in the March quarter 2005. The increase this quarter is mainly driven by the Mining industry.

Graph: Building, CVM



EQUIPMENT, PLANT AND MACHINERY

The trend estimate for equipment, plant and machinery increased 3.3% in the June quarter 2005. The estimate has been strong for the past five quarters, with the rate of growth easing slightly in the past two quarters. In seasonally adjusted terms, the estimate has increased 12.7% with the majority of the increase contributed by the Mining and Transport and Storage industries.

Graph: Equipment, Plant and Machinery, CVM



MINING

The trend estimate for Mining increased 6.3% this quarter, the third consecutive quarter of strong growth. There has been strong growth in seasonally adjusted terms for the past two quarters, with the current quarter showing the strongest recent growth (up 13.0%). The increase this quarter is across both asset types.

Graph: Mining, CVM



MANUFACTURING

The trend estimate for Manufacturing increased 4.7% in the June quarter 2005, the fourth consecutive quarter of similar growth. In seasonally adjusted terms, the estimate has increased slightly (up 1.2%) following two quarters of stronger growth. Expenditure on buildings and structures is the main contributor to this quarter's rise.

Graph: Manufacturing, CVM



OTHER SELECTED INDUSTRIES

The trend estimate for Other selected industries increased 2.1% in the June quarter 2005. Seasonally adjusted, the estimate increased 8.0% which is being driven by a large increase in equipment expenditure, mainly by the Transport and Storage industry. It is offset slightly by a decrease in buildings and structures.

Graph: Other Selected Industries, CVM



ACTUAL AND EXPECTED NEW CAPITAL EXPENDITURE


FINANCIAL YEARS AT CURRENT PRICES

The graphs below show the seven estimates of actual and expected expenditure for each financial year. The estimates appearing below relate to data contained in tables 5 and 6. Advice about the application of realisation ratios to these estimates is in paragraphs 24 to 27 of the Explanatory Notes.


The timing and construction of these estimates are as follows:

Composition of Estimate
Diagram: Composition of estimates




TOTAL CAPITAL EXPENDITURE

The final estimate for 2004-05 is $57,406m which is 12% higher than the comparable estimate for 2003-04 and 1% lower than estimate 6. Other selected industries has increased since estimate 6 (up 2%) which is being offset by falls in Mining and Manufacturing (down 6% and 2% respectively).


The third estimate for 2005-06 is 16% higher than estimate 2 and 15% higher than the corresponding estimate for 2004-05. All industries have increased since estimate 2.

Diagram: Financial Year Estimates, Total



BUILDINGS AND STRUCTURES

Estimate 7 for 2004-05 is 5% lower than estimate 6, but is 23% higher than estimate 7 for the previous financial year. All industries have decreased since estimate 6, with the exception of Construction which has increased (up 7%).


The third estimate for 2005-06 is 21% higher than estimate 2, and 23% higher than estimate 3 for 2004-05. The most significant contributors to the increase since estimate 2 were Transport and Storage (up 46%), Retail (up 36%), and Property and Business (up 33%) and Mining (up 32%).

Diagram: Financial Year Estimates, Buildings and structures



EQUIPMENT, PLANT AND MACHINERY

Estimate 7 for 2004-05 is 7% higher than estimate 6 and 1% higher than the comparable estimate for 2003-04. Most industries have increased since estimate 6, with the exception of Mining and Manufacturing which have fallen 10% and 2% respectively.


Estimate 3 for 2005-06 is 13% higher than estimate 2, and 11% higher than estimate 3 for 2004-05. All industries have increased since estimate 2.

Diagram: Financial Year Estimates, Equipment, plant and machinery



MINING

The final estimate for 2004-05 for Mining is 6% lower than estimate 6, but is still 11% higher than the comparable estimate for 2003-04. Both equipment, plant and machinery and buildings and structures expenditure have fallen since estimate 6.


Estimate 3 for Mining for 2005-06 is 19% higher than estimate 2 and 15% higher than estimate 3 for 2004-05. Buildings and structures expenditure is the most significant contributor to the increase since estimate 2.

Diagram: Financial Year Estimates, Mining



MANUFACTURING

The seventh estimate for 2004-05 is 2% lower than estimate 6, and 11% higher than estimate 7 for 2003-04. Both asset types have had small decreases since estimate 6.


Estimate 3 for 2005-06 has increased 9% since estimate 2 and is 14% higher than the comparable estimate for 2004-05. A strong increase in equipment, plant and machinery (up 15%) was partially offset by a decrease in buildings and structures expenditure.

Diagram: Financial Year Estimates, Manufacturing



OTHER SELECTED INDUSTRIES

Estimate 7 for 2004-05 has increased 2% since estimate 6 and is 13% higher than estimate 7 for 2003-04. A decrease in buildings and structures has partially offset an increase in equipment, plant and machinery since estimate 6.


The third estimate for 2005-06 is 18% higher than estimate 2 and 17% higher than estimate 3 for 2004-05. All component industries have increased since estimate 2 and the increase is across both asset types.


Diagram: Financial Year Estimates, Other Selected industries



EXPERIMENTAL PROJECTED CAPITAL EXPENDITURE


IN CURRENT PRICE TERMS


PROJECTED CAPITAL EXPENDITURE SERIES

The projected series below apply historical realisation ratios to contemporary expectations to convert these to quarterly figures. Trend estimates of resultant quarterly time series of actual and expected expenditure are produced.


The following graphs, with accompanying commentary, show the projected capital expenditure series based on June quarter 2005 data, which includes expected expenditure up to and including the June quarter 2006. Please see paragraphs 28 to 32 of the Explanatory Notes for further details about the methodology and cautionary notes for this series.



TOTAL CAPITAL EXPENDITURE

Current price trend estimates for total Capital Expenditure have been increasing over the past four quarters. Expectations for the 2005-06 financial year suggest this growth has reached a peak, and growth over the next year will be relatively flat. All major industry groups are expecting a drop in growth rates for 2005-06.

Graph: Projected Total Expenditure



BUILDINGS AND STRUCTURES

In current price terms, trend estimates for buildings and structures have shown steady growth over the past three years. Expectations for the next year indicate that this growth will reach a peak next quarter, and then start to decline slightly over the rest of the 2005-06 financial year. Much of the decline is being driven by Manufacturing, while both Mining and Other selected industries are expecting flat growth over the next year.

Graph: Projected Building Expenditure



EQUIPMENT, PLANT AND MACHINERY

Current price trend estimates for equipment, plant and machinery have had strong growth over 2004-05 financial year. However expectations indicate that this growth will flatten out over the next financial year. The recent growth is across all major industry groups, with Mining being the largest contributor to the expected decline in growth rates in 2005-06.

Graph: Projected Equipment Expenditure



MINING

Trend estimates for Mining in current price terms have increased strongly over the past three quarters. However expectations suggest current growth rates will slow next quarter, and then flatten out over the rest of the 2005-06 financial year. Buildings and structures is the main contributor to the growth, which is expected to continue into next quarter, and will then flatten out.

Graph: Projected Mining Expenditure



MANUFACTURING

Manufacturing trend estimates in current price terms have shown strong growth over the 2004-05 financial year. Expectations indicate that this expenditure will reach a peak next quarter, and will start to decline slightly over the next financial year. The expected decline over the 2005-06 financial year is mainly in expenditure on buildings and structures, whilst equipment, plant and machinery expenditure is expected to be relatively flat.

Graph: Projected Manufacturing Expenditure



OTHER SELECTED INDUSTRIES

The current price trend estimate for Other selected industries has shown strong growth in recent quarters. Expectations suggest that the growth rate of recent quarters will decline over the 2005-06 financial year. Most industry components are expecting a decline in growth rates, with the exception of Transport and Storage and Finance and Insurance where growth is expected to increase over the next financial year.

Graph: Projected Other Selected Industries Expenditure

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