5368.0 - International Trade in Goods and Services, Australia, May 2008  
ARCHIVED ISSUE Released at 11:30 AM (CANBERRA TIME) 03/07/2008   
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Iron ore exports for April and May 2008 presented in tables 12 - 15 of this publication are based on information provided by exporters to the Australian Customs Service (ACS) during those months. At the time of recording these transactions, new contract prices had not been finalised. The information recorded include prices ranging from levels consistent with contract prices that were set from 1 April 2007 to levels generally consistent with the prevailing spot prices. New contract price increases that have been recently negotiated, or are still being negotiated, are not fully reflected in the ACS source data. As with negotiated prices in previous years, it is expected that the increased prices obtained from the negotiation of new contracts will be updated progressively in recorded trade data back to 1 April 2008 as exporters revise the information provided to ACS.

The balance of payments data in this publication for April and May 2008 include adjustments for the anticipated price increases for iron ore exports from 1 April. As progressive revisions to the recorded trade prices are provided to the ABS they will be incorporated into the balance of payments series.

In the unadjusted recorded trade series, the value of iron ore and concentrates increased by 6% between March and April 2008 with volumes down 8% and prices up 16%. In the adjusted balance of payments series, the comparable item increased 48%, with volumes down 8% and prices up 61%.

Since the price increase impact is likely to result in a permanent change in the level of the series (at least for the duration of the new contracts), an estimated trend break correction of $725m has been applied in April 2008 to metal ores and minerals and related aggregates. As a minimum of three months are required for a trend break correction to be accurately estimated, the size of the trend break may be revised. Therefore, users should interpret the trend estimates for recent months with caution.