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1367.5 - Western Australian Statistical Indicators, Dec 2006  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 10/01/2007   
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International trade in Western Australia: 2003-04 to 2005-06

INTRODUCTION

Western Australia's exports trade has benefited greatly from the continued expansion of the Chinese economy, as well as the recovery in Japan. Increased exports to both these countries have driven most of the state's exports growth in recent years, while the United Kingdom and other Asian countries have re-emerged as principal export markets. Strong demand from China has seen Western Australia's raw materials exports grow substantially, particularly for iron ore and nickel. However, Western Australia's other major export commodities, wheat and wool, have been much more variable due to the droughts in 2002-03 and 2005-06.


On the other side of the ledger, Western Australia's imports have also increased solidly in recent years. Imports growth has been mainly driven by the commodities of gold, petroleum, motor vehicles and machinery and equipment, predominantly from Singapore, Japan and the United States. Underpinning imports growth has been strong domestic demand and favourable terms of trade. Increased industry investment, particularly in the state's resources sector, has led to more imports of capital goods, while the overall rise in incomes and employment in the state have also strengthened the demand for imports.



CHANGE IN WESTERN AUSTRALIA'S TOTAL TRADE

The total value of Western Australia's exports increased by $15,502 million or 48.0% between 2003-04 and 2005-06, from $32,302 million to $47,805 million. A large proportion of this growth was due to higher exports prices, as the volume of exports rose by only 2.9% over the period. The total value of Western Australia's imports increased by $7,407 million or 63.4% between 2003-04 and 2005-06, from $11,690 million to $19,097 million. With growth in exports surpassing that of imports, the state's trade balance (exports less imports) rose from $20,612 million to $28,707 million over the period, an increase of $8,095 million or 39.3%.



CHANGE IN WESTERN AUSTRALIA'S TRADE BY COMMODITY

Western Australia's recent export growth was mainly driven by iron ore exports. Almost half (48.0%) of the state's exports growth between 2003-04 and 2005-06 was due to iron ore exports rising by $7,444 million (142.7%). Most of this rise was the result of higher iron ore prices, with only 22.8% of the increase attributable to more ore being exported from Western Australia. Exports of natural gas (up $1,918 million or 88.2%), crude petroleum oils (up $1,669 million or 45.8%) and non-monetary gold (up $1,634 million or 29.4%) were also major drivers of exports growth over the two year period.

GROWTH IN WESTERN AUSTRALIA'S TRADE, By commodity

2003-04
2005-06
Change
Volume change
Rank Commodity
$m
$m
$m
%
%

EXPORTS

1 Iron ore
5 216
12 661
7 444
142.7
22.8
2 Natural gas
2 174
4 092
1 918
88.2
n.a.
3 Crude petroleum oils
3 641
5 310
1 669
45.8
-18.4
4 Non-monetary gold
5 554
7 187
1 634
29.4
-0.5
5 Combined confidential items
6 759
7 688
928
13.7
n.a.
6 Copper ore
110
636
526
479.8
63.0
7 Base metal ores
150
397
247
164.3
188.3
8 Liquefied propane and butane
386
669
283
73.3
6.0
9 Refined petroleum oils
363
566
204
56.1
-11.0
10 Wood chips
-
198
198
. .
. .
11 Copper
57
200
143
249.7
63.5
12 Nickel ores
608
797
189
31.2
24.8
13 Nickel
474
575
101
21.2
0.9
14 Machinery and equipment
73
156
82
112.5
n.a.
15 Live animals
359
435
77
21.3
20.8

IMPORTS

1 Non-monetary gold
1 974
4 352
2 378
120.5
n.a.
2 Refined petroleum oils
573
1 803
1 230
214.5
62.2
3 Ships, boats and floating structures(a)
29
688
660
2 312.2
1 882.8
4 Crude petroleum oils
1 085
1 543
458
42.2
-23.3
5 Motor vehicles for transporting goods
420
714
294
69.8
24.6
6 Passenger motor vehicles
954
1 236
282
29.5
38.0
7 Combined confidential items
346
612
266
76.9
n.a.
8 Civil engineering and contractors' plant and equipment
317
577
260
81.9
49.9
9 Tubes, pipes and hollow profiles
145
298
153
105.1
-25.8
10 Mechanical handling equipment
87
174
87
100.7
n.a.

. . not applicable
- nil or rounded to zero (including null cells)
(a) The large percentage increase in imports of Ships, boats and floating structures was due to a one-off purchase of a large floating offshore storage facility.
ABS data available on request, International Trade in Goods and Services, Australia, cat. no. 5368.0.


The main commodities contributing to Western Australia's imports growth over the last two years have been non-monetary gold and refined petroleum oils. Imports of non-monetary gold more than doubled to $4,352 million between 2003-04 and 2005-06, rising by $2,378 million (120.5%). Refined petroleum oil imports more than tripled to $1,803 million over the two years, up $1,230 million (214.5%).



CHANGE IN THE COUNTRY COMPOSITION OF WESTERN AUSTRALIA'S TRADE

The pattern of Western Australia's international trade flows has remained fairly static in recent years. Asia continues to be the prime destination for the state's exports, driven by their demand for resource commodities, with the United Kingdom also featuring as a major export market. The state's imports are also predominantly sourced from Asia, as well as the United States and United Kingdom.


EXPORTS

Japan continues to be Western Australia's largest export destination, accounting for 22.9% of the state's total value of exports in 2005-06. The next largest export destinations were China (20.5%) and the Republic of Korea (8.6%). These countries have remained the state's three largest export markets since 2003-04. However, India, the 4th ranked export destination in 2003-04, fell to a ranking of 5th largest in 2005-06, while the United Kingdom moved up into 4th position from 5th.


Japan's 22.9% share of Western Australia's total exports in 2005-06 was an increase of only 1.4 percentage points from 2003-04. China's share of total exports increased by a far greater 6.9 percentage points, to hold a 20.5% share in 2005-06. The United Kingdom also recorded a solid increase of 1.1 percentage points during the period. The state's other major export destinations, the Republic of Korea and India, recorded declines in their share of Western Australian exports of 1.3 and 2.1 percentage points respectively, between 2003-04 and 2005-06.

WESTERN AUSTRALIA'S TRADE, By destination - 2005-06

Share of total exports (imports)
Value
Rank in 2003-04
Rank Country
%
$m
no.

EXPORTS

1 Japan
22.9
10 960
1
2 China
20.5
9 815
2
3 Republic of Korea
8.6
4 126
3
4 United Kingdom
7.1
3 370
5
5 India
6.6
3 138
4
6 Singapore
3.4
1 632
7
7 Thailand
3.3
1 568
12
8 United States
2.7
1 268
6
9 Indonesia
2.5
1 216
8
10 Taiwan
2.5
1 187
10

IMPORTS

1 Singapore
14.6
2 789
4
2 United States
11.1
2 112
1
3 Japan
10.9
2 087
2
4 China
6.2
1 177
5
5 Indonesia
6.0
1 155
3
6 Republic of Korea
5.7
1 084
7
7 Thailand
4.2
809
8
8 Malaysia
4.1
787
6
9 United Kingdom
3.6
694
11
10 Saudi Arabia
3.2
608
12

ABS data available on request, International Trade in Goods and Services, Australia, cat. no. 5368.0.


IMPORTS

Singapore took over from the United States as Western Australia's major source of imports in 2005-06, accounting for 14.6% of the state's total value of imports. Singapore moved into 1st position from being the 4th largest source of imports for the state in 2003-04, while the United States fell to 2nd position, accounting for 11.1% of the state's total imports in 2005-06. These nation's were followed by large import shares from Japan (10.9%), China (6.2%) and Indonesia (6.0%).


Singapore's share of total Western Australian imports rose by 7.2 percentage points from 2003-04 to 2005-06, compared to a 0.4 percentage points decline for the United States. An increase in import shares was also recorded by China with 0.9 percentage points, while Indonesia and Japan recorded declining shares of Western Australian imports of 4.6 and 0.3 percentage points respectively, over the last two years.



DRIVERS OF WESTERN AUSTRALIA'S TRADE BY DESTINATION AND COMMODITY

Over half of Western Australia's export growth has been driven by China and Japan in the last two years, with much of the increase attributable to exports of iron ore. On the other hand, growth in Western Australian imports has been driven by petroleum and gold imports, mainly from Singapore, Japan and the United States.


EXPORTS GROWTH

The total value of Western Australia's exports increased by $15,502 million between 2003-04 and 2005-06, with exports to China accounting for 34.8% of the total increase and exports to Japan accounting for 25.9%.


The value of Western Australian exports to China increased by $5,401 million between 2003-04 and 2005-06, largely due to an increase in iron ore exports of $4,812 million (256.9%), from $1,873 million to $6,685 million. China was also a major destination for Western Australia's nickel ore exports, which increased by $175 million from 2003-04 to 2005-06. Processed nickel exports also increased to China from $83 million to $173 million over the period.


The value of Western Australia's exports to Japan rose by $4,018 million (57.9%) from 2003-04 to 2005-06. After China, Japan was the state's 2nd largest export destination for iron ore, with exports rising from $2,052 million in 2003-04 to $3,773 million in 2005-06 (up $1,721 million or 83.9%). Other major commodity exports to Japan were crude petroleum oils (up $359 million or 75.5%), liquefied propane and butane (up $242 million or 63.2%) and non-monetary gold (up $221 million or 136.5%). Exports of wood chips to Japan also showed a significant increase over the last two years, increasing by $193 million.


The state's exports to the United Kingdom recorded a large rise over the last two years, increasing by $1,451 million (75.6%). The United Kingdom was the 2nd largest destination for Western Australia's exports of non-monetary gold, almost doubling from $1,227 million to $2,373 million between 2003-04 and 2005-06 (up $1,146 million or 93.4%).


Western Australian exports have also risen to other Asian countries in recent years. The value of exports to the Republic of Korea rose by $916 million in the two years to 2005-06, mainly due to increasing iron ore and crude petroleum oil exports. Iron ore exports to the Republic of Korea rose from $717 million in 2003-04 to $1,263 million in 2005-06 (up $546 million or 76.1%). The Republic of Korea was the state's largest export destination for crude petroleum oil in 2005-06, rising from $918 million in 2003-04 to $1,365 million (up $447 million or 48.7%).


Non-monetary gold has been a major driver of Western Australia's exports growth to India and Thailand in recent times. India was the largest destination for Western Australia's non-monetary gold exports between 2003-04 and 2005-06, increasing from $2,671 million to $2,774 million (up $104 million or 3.9%). Western Australia's exports of gold also increased to Thailand, up by $468 million or 199.0% over the period.

GROWTH IN WESTERN AUSTRALIA'S EXPORTS, By selected destination and commodity

2003-04
2005-06
Change
Country(a) Commodity(b)
$m
$m
$m

China Iron ore
1 873
6 685
4 812
Nickel ore
-
175
175
Nickel
83
173
90
Total
4 414
9 815
5 401
Japan Iron ore
2 052
3 773
1 721
Crude petroleum oils
475
834
359
Liquefied propane and butane
383
626
242
Non-monetary gold
162
384
221
Wood chips
-
193
193
Total
6 942
10 960
4 018
United Kingdom Non-monetary gold
1 227
2 373
1 146
Iron ore
103
143
40
Total
1 920
3 370
1 451
Republic of Korea Iron ore
717
1 263
546
Crude petroleum oils
918
1 365
447
Total
3 210
4 126
916
Thailand Non-monetary gold
235
704
468
Crude petroleum oils
221
551
329
Total
725
1 568
843
Taiwan Iron ore
258
518
260
Crude petroleum oils
-
45
45
Total
792
1 187
395
Singapore Crude petroleum oils
682
941
260
Refined petroleum oils
44
129
85
Total
1 239
1 632
393
Papua New Guinea Crude petroleum oils
-
380
380
Total
18
407
389
India Non-monetary gold
2 671
2 774
104
Copper ore
8
108
99
Total
2 812
3 138
326
New Zealand Refined petroleum oils
171
378
206
Crude petroleum oils
156
193
37
Total
471
763
292

- nil or rounded to zero (including null cells)
(a) Top 10 export destinations for Western Australia.
(b) Commodities were selected based on their contribution to growth in country exports.
ABS data available on request, International Trade in Goods and Services, Australia, cat. no. 5368.0.
Totals include commodities not listed in the table.


Crude petroleum oils was another major commodity contributing to Western Australian exports growth over the last couple of years. Thailand was a significant recipient of Western Australian crude petroleum oil, with exports rising by $329 million (148.8%), from $221 million to $551 million between 2003-04 and 2005-06. Papua New Guinea does not account for a major share of Western Australian exports, however, it did record a large increase in crude petroleum oil exports of $380 million over the last two years. Singapore was the 2nd largest recipient of Western Australia's crude petroleum oil exports, increasing from $682 million to $941 million (up $260 million or 38.1%).


Detracting from Western Australia's exports growth over the past couple of years has been farm sector exports. The value of wheat exported by Western Australia decreased from $1,785 million in 2003-04 to $1,614 million in 2005-06 (down $171 million or 9.6%), due to the 2005-06 drought and falling world wheat prices. Wool exports were also hampered by the 2005-06 drought, declining by $10 million (2.0%) between 2003-04 and 2005-06, from $502 million to $492 million. However, Western Australia began exporting wood chips again in 2005-06, with exports increasing by $198 million in that year.


IMPORTS GROWTH

The total value of Western Australia's imports increased by $7,407 million between 2003-04 and 2005-06, with imports from Singapore, Japan and the United States recording the largest increases. Imports from Singapore accounted for 25.9% of the rise in total imports, while Japan and the United States each accounted for 10.4% of total imports growth.


Singapore was Western Australia's largest source of imports in 2005-06, recording an increase of $1,918 million or 220.2% between 2003-04 and 2005-2006. Singapore was the state's largest source of refined petroleum oils, with imports increasing by $975 million (259.5%), from $376 million to $1,351 million over the period. Also contributing to the rise in imports from Singapore was non-monetary gold, which increased from $134 million to $1,078 million between 2003-04 and 2005-06 (up $944 million or 705.9%). Much of these gold imports are processed and re-exported.

GROWTH IN WESTERN AUSTRALIA'S IMPORTS, By selected destination and commodity

2003-04
2005-06
Change
Country(a) Commodity(b)
$m
$m
$m

Singapore Refined petroleum oils
376
1 351
975
Non-monetary gold
134
1 078
944
Total
871
2 789
1 918
Japan Non-monetary gold
-
323
323
Refined petroleum oils
-
122
122
Passenger motor vehicles
612
690
79
Total
1 315
2 087
772
United States Non-monetary gold
-
345
344
Motor vehicles for transporting goods
152
257
105
Total
1 340
2 112
771
Republic of Korea Ships, boats and floating structures
-
551
551
Refined petroleum oils
-
136
135
Total
461
1 084
623
China Ships, boats and floating structures
-
29
29
Rubber tyres
10
35
25
Total
613
1 177
564
United Kingdom Non-monetary gold
14
274
259
Passenger motor vehicles
22
38
17
Total
314
694
380
Saudi Arabia Crude petroleum oils
180
499
318
Refined petroleum oils
-
7
7
Total
246
608
361
Thailand Non-monetary gold
145
388
243
Motor vehicles for transporting goods
89
186
98
Total
448
809
360
United Arab Emirates Crude petroleum oils
153
347
194
Ships, boats and floating structures
1
35
34
Total
170
431
261
Malaysia Non-monetary gold
11
193
182
Civil engineering and contractors' plant and equipment
-
14
13
Total
550
787
237

- nil or rounded to zero (including null cells)
(a) Top 10 sources of imports for Western Australia.
(b) Commodities were selected based on their contribution to growth in country imports.
ABS data available on request, International Trade in Goods and Services, Australia, cat. no. 5368.0.
Totals include commodities not listed in the table.


The value of imports sourced from Japan increased significantly between 2003-04 and 2005-06, rising by $772 million (58.7%). This increase was largely due to non-monetary gold imports rising by $323 million over the two year period, while imports of refined petroleum oils also contributed significantly (up $122 million). Japan was the largest source of passenger motor vehicles for Western Australia, with imports increasing from $612 million to $690 million over the period (up $79 million or 12.9%).


The United States was the 3rd largest source of imports for Western Australia in 2005-06, with a rise in imports of $771 million (57.5%) from 2003-04. Imports of non-monetary gold (up $344 million) and motor vehicles for transporting goods (up $105 million or 68.8%) were the two major commodities purchased from the United States by Western Australia over the last two years.


There was also a significant increase in petroleum imports from Saudi Arabia and the United Arab Emirates in recent years. Crude petroleum imports rose by $318 million (176.4%) from Saudi Arabia and by $194 million (126.9%) from the United Arab Emirates between 2003-04 and 2005-06.


Despite Indonesia being Western Australia's 5th largest source of imports in 2005-06, it recorded a decline of $91 million (7.3%) in the value of imports to Western Australia from $1,246 million in 2003-04 to $1,155 million in 2005-06. However, this decrease in imports from Indonesia was relatively small. Indonesia remained a major source of crude petroleum oils for Western Australia, with imports increasing by $68 million (27.4%), from $248 million to $316 million over the two year period.



WESTERN AUSTRALIA'S TRADE IN SERVICES

The availability of detailed international trade in services data is fairly limited at the state level, although the State accounts provide some estimates at an aggregate level. Between 2003-04 and 2005-06, Western Australia's exports of services increased by $432 million (13.7%) in current price terms, from $3,148 million to $3,580 million, while services imports rose by $683 million (21.2%), from $3,228 million to $3,911 million. As a result, the state's trade deficit in services rose from $80 million to $331 million over the last two years, an increase of $251 million or 313.8%.


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