he outlook, broadly for the industry, isn\u2019t overly favourable with mining investment expected to fall by 27.5 per cent in 2015-16 and 25.5 per cent in 2016-17, as the industry still reels from the downturn.<\/strong><\/p>\nMining itself has also dealt a major blow to budget estimates, being directly blamed for a shortfall in expectations.<\/p>\n
\u201cThe largest contributor to the expected forecast error in 2015-16 is from the shortfall in company tax. In 2015-16, company tax is estimated to be $3.5 billion (5.1 per cent) lower than expected in the 2015-16 Budget. This is primarily driven by the fall in commodity prices in recent years, lowering profitability in the mining sector,\u201d the budget papers stated.<\/p>\n
Yet the government is pinning forecasts for the domestic economy using what may be inflated spot prices.<\/p>\n
It has forecast a spot price of US$55 per tonne for iron ore, a rise from previous estimates of US$39 per tonne; US$91 per tonne for coking coal compared to US$73 per tonne in the last budget; and US$52 per tonne for thermal coal, which remains unchanged from previous budget estimates.<\/p>\n
Despite this negative forecast \u2013 or because of it \u2013 the government is stepping in to build a new foundation for the next wave of mining.<\/p>\n
The resources industry has been supported by the federal Government with one of the largest major national initiatives, a program designed to reinvigorate exploration.<\/p>\n
The National Resources Development Strategy \u2013 Exploring for the Future, is a $100.5 million program designed to boost productivity and competiveness of the sector.<\/p>\n
\u201cThe 2016-17 Budget delivers a strong boost to the productivity and competitiveness of this sector with $100 million provided to Geoscience Australia for mapping mineral, energy and groundwater potential in northern Australia and South Australia,\u201d national minister for resources and energy Josh Frydenberg said.<\/p>\n
According to the government, \u201cThe $100 million Exploring for the Future programme will produce pre-competitive geoscience data, to be released on an annual basis over the next four years. Geoscience Australia estimates that around 80 per cent of Australia remains under-explored, in particular, areas in the Northern Territory, Queensland, Western Australia, and South Australia, which will be the focus of this initiative. This will improve Australia\u2019s long term exploration prospects and help address declining new onshore exploration.\u201d<\/p>\n
Frydenebrg added: \u201cThe benefits for doing so are clear. In 1996, Geoscience Australia undertook $3 million of analysis in the Browse Basin. This helped identify the Ichthys field, which will produce more than $70 billion in export earnings over the next forty years.\u201d<\/p>\n
\u201cFurther, data compiled across South Australia in the 1960s, costing around $350,000, helped identify the resource potential of the Olympic Dam and ultimately to the discovery of ore more than 300 metres underground.,\u201d he said.<\/p>\n
\u201cAt a challenging time for the resources sector, this important initiative will help ensure that Australia\u2019s strength in innovation is furthered, and that we maintain our competitive edge in this world-leading sector.\u201d<\/p>\n
The initiative was welcomed by mining lobby groups.<\/p>\n
The Minerals Council of Australia called it a \u201cstrong pro-growth budget\u201d.<\/p>\n
\u201cIt balances a careful approach to spending, the maintenance of a strict approach to tax integrity and lays out a medium term plan to promote investment and growth,\u201d Minerals Council chief executive Brendan Pearson said.<\/p>\n
\u201cThe minerals sector welcomes the Government\u2019s commitment to a $100.5 million initiative over four years to produce mineral, petroleum and groundwater resource data in targeted areas in northern Australia and South Australia to help identify new greenfield exploration sites.<\/p>\n
\u201cThis is a critical investment to identify the next sources of Australia\u2019s minerals wealth. \u201c<\/p>\n
The Queensland Resources Council echoed the Minerals Council, stating \u201cit is pleasing the Turnbull Government has an eye to high-tech jobs of the future in the resources sector\u201d.<\/p>\n
\u201cExploration is the R&D, or building blocks, for the resources sector, getting the sector ready for the inevitable future upswing<\/strong>,\u201d QRC chief Michael Roche said.<\/p>\nHowever, greener mining initiatives have been scrapped in the new budget, with the Low Emissions Technology Demonstration Fund and the Coal Mining Technology Abatement Support Package closed, while the Carbon Capture and Storage Flagships funding has been reduced.<\/p>\n","protected":false},"excerpt":{"rendered":"
With the release of the latest Federal Budget there have been fewer changes than expected, with small business and middle income tax payers the big winners, but how will it affect the mining sector? The outlook, broadly for the industry, isn\u2019t overly favourable with mining investment expected to fall by 27.5 per cent in 2015-16 … Continue reading “How the Federal Budget affects mining”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[6],"tags":[],"class_list":["post-1370","post","type-post","status-publish","format-standard","hentry","category-mines-and-quarry"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p83F9T-m6","jetpack-related-posts":[{"id":1225,"url":"https:\/\/yinghuiinternational.com\/index.php\/2016\/01\/19\/oil-and-gas-contractors-and-diamonds-australias-fastest-declining-industries\/","url_meta":{"origin":1370,"position":0},"title":"Oil and gas, contractors, and diamonds Australia\u2019s fastest declining industries","author":"yinghui","date":"January 19, 2016","format":false,"excerpt":"A new IBISWorld report has highlighted petroleum refining, contract mining, and diamond mining as the country\u2019s fastest declining industries in 2016. Petroleum refining is slated to shrink 16.7 per cent this year, with industry revenue to decline at compound annual rate of 7.7 per cent over the five years through\u2026","rel":"","context":"In "Mines and Quarry"","block_context":{"text":"Mines and Quarry","link":"https:\/\/yinghuiinternational.com\/index.php\/category\/mines-and-quarry\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1192,"url":"https:\/\/yinghuiinternational.com\/index.php\/2016\/01\/04\/little-respite-for-mining-in-2016\/","url_meta":{"origin":1370,"position":1},"title":"Little respite for mining in 2016","author":"yinghui","date":"January 4, 2016","format":false,"excerpt":"Despite the apparent normalisation of low commodity prices, the Federal Government has predicted mining exports earnings to grow by more than 40 per cent by 2019-2020. The release of the Department of Industry, Innovation and Science Resources and Energy Quarterly report in the December quarter showed the mining sector\u2019s contribution\u2026","rel":"","context":"In "Mines and Quarry"","block_context":{"text":"Mines and Quarry","link":"https:\/\/yinghuiinternational.com\/index.php\/category\/mines-and-quarry\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":1134,"url":"https:\/\/yinghuiinternational.com\/index.php\/2015\/12\/01\/mining-investment-to-implode\/","url_meta":{"origin":1370,"position":2},"title":"Mining investment to implode","author":"yinghui","date":"December 1, 2015","format":false,"excerpt":"Mining investment in Australia is set to decline sharply over the next three years, resulting in 20,000 job losses. A new report by BIS Shrapnel \u2013 Mining in Australia 2015 to 2030 \u2013 predicts the current state of contraction to continue in mining, falling a further 58 per cent over\u2026","rel":"","context":"In "Mines and Quarry"","block_context":{"text":"Mines and Quarry","link":"https:\/\/yinghuiinternational.com\/index.php\/category\/mines-and-quarry\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":605,"url":"https:\/\/yinghuiinternational.com\/index.php\/2014\/11\/25\/production-and-maintenance-to-drive-the-expanded-industry\/","url_meta":{"origin":1370,"position":3},"title":"Production and maintenance to drive the expanded industry","author":"yinghui","date":"November 25, 2014","format":false,"excerpt":"Mining investment will collapse by 40 per cent over the next four years, but the sector will grow in absolute terms as a result of greater production and maintenance requirements, according to a new report. Industry analyst BIS Shrapnel said the mining sector will also claim a greater share of\u2026","rel":"","context":"In "Mines and Quarry"","block_context":{"text":"Mines and Quarry","link":"https:\/\/yinghuiinternational.com\/index.php\/category\/mines-and-quarry\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":672,"url":"https:\/\/yinghuiinternational.com\/index.php\/2014\/12\/20\/the-2015-energy-outlook-series-coal\/","url_meta":{"origin":1370,"position":4},"title":"The 2015 Energy Outlook Series: Coal","author":"yinghui","date":"December 20, 2014","format":false,"excerpt":"Coal has had a tumultuous 12 months but will 2015 be any better? Coal prices declined steadily in the first months of 2014 in response to a combination of in-creased supply and lower import demand from China. Australian benchmark contract prices for high-quality metallurgical coal settled at $US120 in the\u2026","rel":"","context":"In "Mines and Quarry"","block_context":{"text":"Mines and Quarry","link":"https:\/\/yinghuiinternational.com\/index.php\/category\/mines-and-quarry\/"},"img":{"alt_text":"","src":"","width":0,"height":0},"classes":[]},{"id":8435,"url":"https:\/\/yinghuiinternational.com\/index.php\/2023\/09\/20\/nsw-budget-puts-mining-in-the-spotlight\/","url_meta":{"origin":1370,"position":5},"title":"NSW Budget puts mining in the spotlight","author":"yinghui","date":"September 20, 2023","format":false,"excerpt":"ALEXANDRA EASTWOOD The 2023-24 NSW Budget has been released, reflecting the Government\u2019s commitment to the mining and resources sector. The\u00a0Budget\u00a0includes $5.2 million to establish Future Jobs and Investment Authorities. This will also assist coal-producing regions to develop new industries and economic opportunities as the state pushes for renewable energy. Geological\u2026","rel":"","context":"In "Go Australia (\u8d70\u8fdb\u6fb3\u6d32)"","block_context":{"text":"Go Australia (\u8d70\u8fdb\u6fb3\u6d32)","link":"https:\/\/yinghuiinternational.com\/index.php\/category\/go-australia\/"},"img":{"alt_text":"NSW Treasurer Matt Kean will unveil requirements which force coal companies to reserve 10 per cent of their output exclusively for domestic use.","src":"https:\/\/i0.wp.com\/www.australianmining.com.au\/wp-content\/uploads\/2022\/02\/shutterstock_1176092938-1024x681.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/www.australianmining.com.au\/wp-content\/uploads\/2022\/02\/shutterstock_1176092938-1024x681.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/www.australianmining.com.au\/wp-content\/uploads\/2022\/02\/shutterstock_1176092938-1024x681.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/www.australianmining.com.au\/wp-content\/uploads\/2022\/02\/shutterstock_1176092938-1024x681.jpg?resize=700%2C400&ssl=1 2x"},"classes":[]}],"jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/yinghuiinternational.com\/index.php\/wp-json\/wp\/v2\/posts\/1370","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/yinghuiinternational.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/yinghuiinternational.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/yinghuiinternational.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/yinghuiinternational.com\/index.php\/wp-json\/wp\/v2\/comments?post=1370"}],"version-history":[{"count":0,"href":"https:\/\/yinghuiinternational.com\/index.php\/wp-json\/wp\/v2\/posts\/1370\/revisions"}],"wp:attachment":[{"href":"https:\/\/yinghuiinternational.com\/index.php\/wp-json\/wp\/v2\/media?parent=1370"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/yinghuiinternational.com\/index.php\/wp-json\/wp\/v2\/categories?post=1370"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/yinghuiinternational.com\/index.php\/wp-json\/wp\/v2\/tags?post=1370"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
![\"budget-550x270\"](\"http:\/\/www.bnmme.com.au\/wp-content\/uploads\/2016\/05\/budget-550x270.jpg\")
With the release of the latest Federal Budget there have been fewer changes than expected, with small business and middle income tax payers the big winners, but how will it affect the mining sector?<\/p>\n