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5625.0 - Private New Capital Expenditure and Expected Expenditure, Australia, Mar 2006  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 01/06/2006   
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MARCH KEY FIGURES

Mar Qtr 06
Dec Qtr 05 to Mar Qtr 06
Mar Qtr 05 to Mar Qtr 06
$m
% change
% change

Trend estimates(a)
Total new capital expenditure
18 757
4.8
29.1
Buildings & structures
6 023
4.5
32.2
Equipment, plant & machinery
12 703
4.5
27.5
Seasonally adjusted(a)
Total new capital expenditure
18 571
0.6
28.9
Buildings & structures
6 065
3.6
29.8
Equipment, plant & machinery
12 549
-0.5
28.4

(a) In volume terms.

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



MARCH KEY POINTS


ACTUAL EXPENDITURE (VOLUME TERMS)
  • The trend estimate for total capital expenditure increased by 4.8% in March quarter 2006. It rose by 0.6% in seasonally adjusted terms following a revised increase of 13.0% in the December quarter 2005.
  • An increase in seasonally adjusted expenditure on buildings and structures (up 3.6%) has been the source of growth this quarter, mainly driven by Mining.
  • Seasonally adjusted expenditure on equipment, plant and machinery declined 0.5% following a revised increase of 14.2% in the December quarter 2005. The fall was mainly driven by Manufacturing and the Other selected industries.


EXPECTED EXPENDITURE (CURRENT TERMS)
  • This issue includes the sixth estimate for 2005-06 and the second estimate for 2006-07.
  • Estimate 6 for 2005-06 is $71,443m. This estimate is 23.6% higher than Estimate 6 for 2004-05 and 4.3% higher than Estimate 5 for 2005-06.
  • Estimate 2 for 2006-07 is $58,877m. This is 20.5% higher than Estimate 2 for 2005-06 and 8.9% higher than estimate 1 for 2006-07.
  • See pages 6 to 9 for further commentary on expectations data.


NOTES

FORTHCOMING ISSUES

ISSUE (QUARTER) Release Date
June 2006 31 August 2006
September 2006 30 November 2006



CHANGES IN THIS ISSUE

There are no changes in this issue.



INQUIRIES

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



ACTUAL NEW CAPITAL EXPENDITURE IN VOLUME TERMS


TOTAL CAPITAL EXPENDITURE

The growth rate in the trend estimate for total new capital expenditure eased in the March quarter 2006 increasing 4.8%. The decline in the growth rate for the second consecutive quarter followed two quarters of strong growth. The seasonally adjusted estimate increased 0.6% this quarter due to an increase in buildings and structures of 3.6%.

Graph: Total Capital Expenditure, CVM



BUILDINGS AND STRUCTURES

The trend estimate for buildings and structures increased 4.5% in the March quarter 2006, however the rate of growth has fallen for the second consecutive quarter after two quarters of strong growth. In seasonally adjusted terms, the estimate increased 3.6%. The increase this quarter is driven by Mining, up 26.6%.

Graph: Building, CVM



EQUIPMENT, PLANT AND MACHINERY

The trend estimate for equipment, plant and machinery increased by 4.5% in the March quarter 2006, the growth rate falling after seven consecutive quarters of strong growth. In seasonally adjusted terms, the March quarter estimate was down 0.5%. The fall was mainly driven by Other selected industries and Manufacturing down 2.3% and 3.3% respectively, with Property and business services and Transport and storage being the main contributors to the fall in Other selected industries.

Graph: Equipment, Plant and Machinery, CVM



MINING

The trend estimate for Mining increased by 14.8% in the March quarter 2006, the fourth consecutive quarter of strong growth. The seasonally adjusted estimate increased 20.0%, maintaining the growth seen in the previous three quarters. Buildings and structures was the main contributor, with 26.6% seasonally adjusted growth while equipment, plant and machinery recorded an 11.3% increase.

Graph: Mining, CVM



MANUFACTURING

The rate of growth in the trend estimate for Manufacturing continued to ease in the March quarter 2006 increasing 0.4%. In seasonally adjusted terms, the estimate fell 3.1%, the second consecutive quarter of decline after experiencing a strong quarter of growth in the September quarter 2005. Equipment, plant and machinery is the main contributor to the fall, down 3.3% while buildings and structures, declined 2.6% in seasonally adjusted terms.

Graph: Manufacturing, CVM



OTHER SELECTED INDUSTRIES

The trend estimate for Other selected industries increased 2.5% in the March quarter 2006. In seasonally adjusted terms, Other selected industries fell 4.9% following a strong quarter of growth in December quarter 2005 of 16.6%. The fall was mainly due to a decrease in buildings and structures of 13.2%.

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:

Table:Composition of Estimate
TOTAL CAPITAL EXPENDITURE

Estimate 6 for 2005-06 is $71,443m which is 23.6% higher than Estimate 6 for 2004-05 and 4.3% higher than Estimate 5 for 2005-06. Most industries recorded increases since Estimate 5 for 2005-06 with Mining (11.5%) recording the largest increase and Retail trade recording the only decrease (0.6%).


Estimate 2 for 2006-07 is 20.5% higher than Estimate 2 for 2005-06 and 8.9% higher than Estimate 1 for 2006-07. The increase since Estimate 1 for 2006-07 was mainly driven by Mining (20.0%),Transport and storage (28.7%) and Retail trade (10.8%).



Graph:Total Capital Expenditure

BUILDINGS AND STRUCTURES

Estimate 6 for 2005-06 is 35.4% higher than Estimate 6 for 2004-05 and 3.4% higher than Estimate 5 for 2005-06. Since Estimate 5 for 2005-06 Mining had the largest increase (up 11.6%) with Construction showing the biggest decline (19.0%).


Estimate 2 for 2006-07 is 35.8% higher than Estimate 2 for 2005-06 and 11.7% higher than Estimate 1 for 2006-07. Mining (23.2%), Property and business services (36.5%), Wholesale trade (26.4%) and Construction (68.4%) all recorded increases since Estimate 1 for 2006-07.

Graph: Buildings and Structures



EQUIPMENT, PLANT AND MACHINERY

Estimate 6 for 2005-06 is 17.2% higher than Estimate 6 for 2004-05 and 4.8% higher than Estimate 5 for 2005-06. All industries have increased since Estimate 5 with the strongest increases in Mining (11.3%), Wholesale trade (12.8%) and Construction (9.7%).


Estimate 2 for 2006-07 is 11.0% higher than Estimate 2 for 2005-06 and 6.9% higher than Estimate 1 for 2006-07. Most industries have shown an increase since Estimate 1 for 2006-07, with the strongest increases in Mining (13.0%), Transport (43.1%) and Retail trade (18.7%).

Graph: Equipment, Plant and Machinery


MINING

Estimate 6 for 2005-06 is 11.5% higher than Estimate 5 for 2005-06 with increases for both buildings and structures and equipment, plant and machinery.


Estimate 2 for 2006-07 is 20.0% higher than Estimate 1 for 2006-07. Expectations have increased in both asset groups. Estimate 2 for buildings and structures is 23.2% higher than Estimate 1 and for equipment, plant and machinery, Estimate 2 is 13.0% higher than Estimate 1.

Graph: Mining



MANUFACTURING

Estimate 6 for 2005-06 is 0.5% higher than Estimate 5 for 2005-06. Increased expectations in buildings and structures (2.2%) contributed to the growth.


Estimate 2 for 2006-07 is 6.7% lower than Estimate 1 for 2006-07, the first decline between Estimate 2 and Estimate 1 since 2001-02. The decline since Estimate 1 is made up of falls in buildings and structures (16.7%) and equipment, plant and machinery (2.9%).

Graph: Manufacturing



OTHER SELECTED INDUSTRIES

Estimate 6 for 2005-06 is 2.8% higher than Estimate 5 for 2005-06. Equipment, plant and machinery is contributing to the majority of this increase, with all industries except Retail trade showing increases on Estimate 5.


Estimate 2 for 2006-07 is 9.2% higher than Estimate 1 for 2006-07. All industries except Other services have increased since Estimate 1 for 2006-07.

Graph: 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 March quarter 2006 data, which includes expected expenditure up to and including the June quarter 2007. Please see paragraphs 28 to 32 of the Explanatory Notes for further details about the methodology and cautionary notes for these series.



TOTAL CAPITAL EXPENDITURE

Current price trend estimates for total capital expenditure have increased sharply since 2004-05. Expectations for the next 15 months suggest a flattening of capital expenditure, with a decline towards the end of 2006-07.

Graph: Projected Total Expenditure



BUILDINGS AND STRUCTURES

In current price terms, trend estimates for buildings and structures have displayed sustained growth over the past four years. The expectations for the next fifteen months suggest a period of levelling in growth until the beginning of 2007 when a decline is suggested. Mining and Manufacturing are the main contributors to the decline.

Graph: Projected Building Expenditure



EQUIPMENT, PLANT AND MACHINERY

Current price trend estimates for equipment, plant and machinery, have shown strong growth since the beginning of the 2004-05 financial year. Expectations for the next fifteen months indicate a decline in the trend from June quarter 2006.

Graph: Projected Equipment Expenditure



MINING

Trend estimates for Mining have increased strongly since the September quarter 2004. Expectations over the next fifteen months suggest a slowing in growth followed by a decline towards the end of 2006-07. Growth in buildings and structures is expected to continue until March 2007 when expectations begin to decline. The trend in equipment, plant and machinery is expected to decline over the next fifteen months.

Graph: Projected Mining Expenditure



MANUFACTURING

Manufacturing trend estimates have shown strong growth since 2004-05, with growth flattening over the last quarter. Expectations for the next fifteen months suggest expenditure for both asset groups has peaked and will fall for the remainder of the 2006 calendar year, followed by a slow decline in spending for the first six months of 2007.

Graph: Projected Manufacturing Expenditure



OTHER SELECTED INDUSTRIES

The current price estimates for Other selected industries have shown strong growth since March quarter 2005. Estimates for the next fifteen months indicate that growth is expected to peak toward the end of 2006, followed by a decline in the first six months of 2007. Growth in buildings and structures is expected to flatten towards the end of the 2005-06 financial year. Growth in equipment, plant and machinery is expected to decline from the start of 2007.

Graph: Projected Other Selected Industries Expenditure






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