Western Australian exports to China hit lowest month since 2021

Western Australia is still the nation’s dominant exporter but the latest data shows sales to China have slowed. The State’s merchandise exports to the Asian superpower in July were at their lowest monthly level since late 2021, with just under $9 billion shipped. That’s down from $11.2 billion in in July 2023, according to recent numbers from the Australian Bureau of Statistics which broadly showed a slight uptick in national exports. The numbers are quite volatile and were not seasonally adjusted, however. Just more than 40 per cent of all Australian merchandise exports were produced in WA. It comes amid concern about the future price trajectory of the State’s biggest earner — iron ore — and with Treasurer Jim Chalmers worried lower commodity prices could cut the nation’s tax revenue by $4.5 billion. ANZ said the country’s exports to China were also at their lowest monthly level in more than two years. Manufacturing numbers were low, Chinese factory activity was slowing and there was concern about excess capacity in the economy, ANZ said. In its outlook for the resources sector, NAB warned “global economic conditions remain broadly unfavourable for commodity demand”. “China — the largest consumer of most commodities — continues to display weak domestic demand and an increasing number of countries are imposing trade measures in response to its export surge,” the big four bank reckoned. NAB expects the price of WA’s biggest export, iron ore, to average less than $US90 a tonne in the first quarter of next year. “Trade policies related China remain a key uncertainty to our outlook,” NAB chief economist Alan Oster wrote. “A range of countries have announced tariffs in response to the surge in Chinese exports since mid-2023, including the United States, the European Union and Indonesia, while others, such as Thailand and India, are facing calls from domestic industry groups to implement similar trade measures.”