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Feature Article - Australia's exports markets, 1991-92 to 2000-01
MAJOR EXPORT MARKETS
Australia's top five export markets in 2000-01 were in order, Japan, USA, Korea, New Zealand and China. In total these countries accounted for 48% of exports, while in 1991-92 they accounted for 50% of total exports. Since 1991-92, the top three were in their same relative position, New Zealand moved from fifth to fourth position, replacing Singapore which dropped to sixth, and China improved from tenth to fifth.
Japan has been Australia's largest export market over the last ten years, with a growth in exports of 61%. Its share of total Australian exports declined from 26% in 1991-92 to 20% in 2000-01, largely as a result of the diversification of Australia's export markets.
MAIN EXPORTS TO JAPAN
Japan was the major destination for Australia's exports of Coal (SITC 321) and Iron ore (SITC 281) during the decade, accounting for more than 40% of Australia's exports of these commodities. Exports of coal to Japan showed modest growth over the period. However, the value of exports did not change substantially as increases in quantity exported were largely offset by price reductions. From 1992--93 Japan displaced the USA as Australia's most important market for Beef (SITC 011).
SELECTED EXPORTS TO JAPAN
Although Japan remained Australia's major market for Aluminium (SITC 684) exports over the decade, exports of this commodity fluctuated due to price and quantity variations. Japan was also Australia's major destination for exports of Crude petroleum (SITC 333) from 1991-92 to 1994-95, but fell to fourth position behind Singapore, Korea, and Taiwan in 2000-01. The sharp increase in the last two years reflects greater demand combined with higher world oil prices and a lower Australian dollar.
Australia's exports of Wool (SITC 268) and Non-monetary gold (SITC 971) to Japan both declined markedly over the last ten years. In 1991-92, Japan was the major market for Australia's exports of wool, while in 2000-01 it fell to eighth position. Non-monetary gold exports were $275 million in 2000-01, after peaking at $1,428 million in 1993-94. Changes in the value of these exports over the decade have largely reflected changes in quantity.
UNITED STATES OF AMERICA
The USA was the second most important destination for Australia's exports during the last decade. While its share of total Australian exports was similar at the beginning and the end of the period at around 10%, there was a decrease in the middle years to a low of 6%.
MAIN EXPORTS TO THE USA
Beef (SITC 011) was Australia's major export to the USA, although its share of trade with the USA decreased from 22% in 1991-92 to 13% in 2000-01. Beef exports dropped from 1991-92 to 1995-96, mainly due to increased competition from USA producers and an appreciating Australian dollar. Reduced USA slaughterings, increased beef prices and a weaker Australian dollar led to an increase in exports in the latter half of the decade.
Crude petroleum (SITC 333) exports to the USA rose from $144 million in 1991-92 to $1,014 million in 2000-2001, driven by higher demand and increased prices in the last two years.
The USA market for Australian Passenger motor vehicles (SITC 781) showed some volatility over the period. It reached a low of $3 million in 1995-96 due to lower consumer demand and expired contracts with USA parent companies, but recovered sharply in subsequent years to reach $489 million in 2000-01.
Exports of Alcoholic beverages (SITC 112) increased from $122 million in 1996-97 to $503 million in 2000-01, mainly due to higher exports of wine. The USA is the second largest market for Australian wine, accounting for a quarter of total wine exports.
THE REPUBLIC OF KOREA
Korea has been either Australia's second or third most important export market during the last decade. The value of exports to Korea has almost trebled since 1991-92 to $9,209 million in 2000-01. Australia's major exports to Korea were fuels, iron ore and non-monetary gold. Non-ferrous metals, particularly aluminium and copper, were also important.
MAIN EXPORTS TO THE REPUBLIC OF KOREA
Coal (SITC 321) was the main export to Korea for most of the decade, making Korea the second largest market for this commodity after Japan. The value of coal exports climbed from $670 million in 1991-92 to a high of $1,189 million in 1997-98, but fell in 1998-99 and 1999-2000 due to reduced demand as a result of the Asian economic crisis. The market recovered somewhat in the last financial year to reach $1,079 million. Iron ore was Australia's second highest export to Korea at the start of the decade. Sales generally increased throughout the ten year period, doubling since 1991-92 to $742 million in 2000-01.
Crude petroleum (SITC 333) exports to Korea exceeded exports of coal for the last two years. Petroleum exports rose steeply in 1999-2000 to $1,104 million reflecting both increased export volumes and higher world oil prices. The value of exports increased to $1,457 million in 2000-2001 even though a reduced quantity was exported.
Australia's exports to Korea of Internal combustion piston engines (SITC 713) increased steadily over the decade until 1998-99, when the value of exports almost halved compared with the previous year. This was largely due to a decline in automotive production in Korea.
Other significant exports to Korea during the ten year period included wheat, zinc ores, copper ores, wool, cotton and beef.
Over the last decade New Zealand was ranked fourth as a destination for Australia's exports. The market grew by 143% over this period to account for 5.7% of total Australian exports. New Zealand is a large consumer of Australian machinery and transport equipment (SITC 7), chemicals (SITC 5) and manufactured products (SITC 6 and SITC 8).
MAIN EXPORTS TO NEW ZEALAND
New Zealand was a major export destination for Passenger motor vehicles (SITC 781) during the last decade. However, its relative importance has declined as new markets have been developed in the Middle East. Exports of passenger motor vehicles to New Zealand were valued at $161 million and accounted for 42% of total motor vehicle exports in 1991-92. This is in contrast to the higher value of exports in 2000-01 of $299 million, which was only 11% of total motor vehicle exports.
There has been strong growth in sales of Refined petroleum (SITC 334) to New Zealand over the period. In 1991-92 Australia exported $119 million of this product to New Zealand, and $538 million in 2000-01. Australia also exported Crude petroleum (SITC 333) to New Zealand. Exports peaked at $163 million in 1996-97, and were still relatively high in 2000-01 at $145 million. While the values were similar in those two financial years, the quantity exported in 2000-01 was approximately half that exported in 1996-97, reflecting higher world oil prices in recent years.
Australia also exported large quantities of medicaments and paper products to New Zealand.
The value of Australia's exports to China have more than quadrupled during the last ten years from $1,458 million to $6,846 million. It is now Australia's fifth largest export market, rising from tenth in 1991-92. Exports to China were dominated by agricultural and mineral raw materials, although there was some broadening of the export base with a rise in exports of partly manufactured goods, particularly copper and aluminium.
MAIN EXPORTS TO CHINA
China has been Australia's major export market for Wool (SITC 268) since 1992-93 when it overtook Japan and Italy. It now accounts for one third of Australia's wool exports. Wheat (SITC 041) has also been an important agricultural export to China during the past ten years. Sales ranged between 2.2 million tonnes in 1995-96 when crops failed in China and 60,000 tonnes in 2000-01.
Iron ore (SITC 281) was the major mineral product exported to China and sales trebled in the last decade to $1,214 million in 2000-01. It has been one of the top two exports to China for the decade. Copper ore (SITC 283) exports have also risen in the last ten years, particularly following China's recovery from the Asian economic downturn of 1997-98. Sales of Crude petroleum (SITC 333) also rose over the period, peaking at $431 million in 1999-2000 when world oil prices rose sharply.
EMERGING EXPORT MARKETS
Over the period 1991-92 to 2000-01, several new export markets have emerged for Australia. Export growth has often been very rapid, and at the end of the decade the value of exports to many of these markets was substantial. A selection of the new markets are analysed below.
EMERGING EXPORT MARKETS
Exports to Saudi Arabia increased eightfold, from $266 million in 1991-92 to $2,196 million in 2000-01, to become Australia's thirteenth largest export market. During the first half of the decade, exports mainly comprised food items such as dairy products, lamb and vegetables.
Saudi Arabia became a new market for Australian motor vehicles from 1995-96. In that year, exports of Passenger motor vehicles (SITC 781) were valued at $11 million. In the last three years, exports of motor vehicles increased by more than $300 million per year to reach a record high of $1,207 million in 2000-01, or 55% of exports to that country. It is now the major export market for Australian motor vehicles, accounting for 44% of motor vehicle exports in 2000-01.
Exports of Australian motor vehicles to other Middle Eastern countries, the United Arab Emirates, Kuwait, Bahrain, Oman and Qatar, increased from $12 million in 1995-96 to $514 million in 2000-01.
From 1991-92 to the end of apartheid in 1993-94, exports to South Africa increased from $226 million to $350 million. During the mid 1990s exports grew by more than $200 million each year and exceeded $1 billion for the first time in 1996-97. Since then exports have remained at around that level, with the value of exports reaching $1,296 million in 2000-01.
Australia commenced exporting Coal (SITC 321) to South Africa in 1996--97. In that year the value was $9 million, which increased to $90 million in 2000-01. Crude petroleum (SITC 333) exports to South Africa began in July 2000 with sales reaching $72 million in 2000-01.
Sales of manufactured goods and chemical products (SITC 5 - 8) to South Africa also grew in the second half of the decade to reach a high of $382 million in 1996-97 and 1997-98. Those exports included aluminium, medicaments, leather, and industrial machinery.
Exports to Iraq over the decade have been severely affected by United Nations trade sanctions. In 1991-92 exports to Iraq were valued at $187 million which dropped to between $14 million and $40 million in the subsequent four years. Since 1996-97 exports recovered to reach a high of $734 million in 2000-01.
As a result of the trade sanctions, Australia's main exports to Iraq were food and humanitarian items, particularly Wheat (SITC 041). These exports were made as part of the UN Oil for Food program. Iraq has been the major recipient of Australian wheat exports for the past two years with exports reaching 2.6 million tonnes in 2000-01. The value of wheat sales is not available due to confidentiality restrictions.
Although Viet Nam remains a minor market for Australian exports, there was a tenfold increase in the value of Australian exports to that country during the past decade. In 2000-01 exports to Viet Nam were valued at $499 million, compared with $50 million in 1991-92.
Australian exports to Viet Nam cover a range of commodities, mainly food products and industrial raw materials. Wheat, cereal preparations and milk products are the major food exports. Aluminium, copper, fertilisers and cotton were the other major commodities exported to this country.
The analysis of exports to APEC, ASEAN and the EU reflects the current composition of these groups and takes no account of changes in membership over the decade. The current membership of these country groups is detailed in the Appendix.
ASIA-PACIFIC ECONOMIC COOPERATION (APEC)
EXPORTS TO APEC
Exports to countries within APEC accounted for the majority of Australia's exports from 1991-92 to 2000-01. APEC contains nine of Australia's top ten export destinations. The value of Australian exports to APEC increased in all years except 1998-99 while the share peaked in 1994-95 at 79%. APEC's share of Australia's exports was at its lowest in 1998-99 at 71% and has since increased to 73% in 2000-01.
ASSOCIATION OF SOUTHEAST ASIAN NATIONS (ASEAN)
EXPORTS TO ASEAN AND THE EU
Australia's exports to ASEAN increased in all financial years over the decade except 1997-98 and 1998-99 when their value declined to $11,514 million and $10,416 million, respectively, as a result of the Asian economic crisis. In 2000-01 exports were $15,922 million, an increase of 116% from their value in 1991-92. Australia's major exports to ASEAN were wheat, milk and cream, live cattle, cotton, petroleum (crude and refined), non-ferrous metals (aluminium, copper and zinc) and non-monetary gold.
ASSOCIATION OF SOUTHEAST ASIAN NATIONS (ASEAN)
Singapore was Australia's major export destination within ASEAN throughout the decade. Indonesia, Malaysia and Thailand also accounted for a large proportion of Australia's exports to ASEAN. Australia's exports to Indonesia declined from $3,305 million in 1996-97 to $2,199 million in 1998-99. Increased exports of Crude petroleum (SITC 333) of $842 million and Non-monetary gold (SITC 971) of $2,055 million to Singapore in 1999-2000 were largely responsible for the recovery in exports to ASEAN.
EUROPEAN UNION (EU)
The total value of exports to the EU was $13,963 million in 2000-01, an increase of 95% over the 1991-92 level of $7,148 million, but the share of Australia's total exports has decreased from 13% to 12%. Australian commodities purchased by the EU were predominantly raw materials and agricultural products - coal, wool, non-monetary gold, metal ores and concentrates. Other products such as catamaran ferries, engines and telecommunications equipment were also exported to the EU during the decade.
Coal (SITC 321) exports ranged between $900 million and $1,300 million for most of the decade. Sales rose to $1,747 million in 2000-01, accounting for 16% of Australian coal exports.
Approximately one-third of Australia's exports of Wool (SITC 268) over the decade was exported to the EU. Sales peaked at $1,382 million in 1997-98 and were $1,193 million in 2000-01.
Exports of Alcoholic beverages (SITC 112), predominantly wine, to the EU increased over the decade from $151 million in 1991-92 to $946 million in 2000-01. Within the EU, the United Kingdom was the major market for this commodity with exports to that country reaching $742 million in 2000-01. Exports of alcoholic beverages to Germany, Ireland and the Netherlands also increased during the decade.
Australia's exports of Non-monetary gold (SITC 971) to the EU (in particular to the United Kingdom) increased from $328 million in 1997-98 to $1,759 million in 1998-99. This coincided with a drop in exports of this commodity to the Asian region which was experiencing economic problems at that time.
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