Mineral Exploration in Australia Industry Market Research Report Now Updated by IBISWorld

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Mineral exploration revenue has grown over the past five years, but is expected to decline in 2012-13 as a result of lower mineral prices. For this reason, industry research firm IBISWorld has updated its report on the Mineral Exploration industry in Australia.

IBISWorld Market Research

IBISWorld Market Research

The industry is highly volatile due to fluctuating mineral prices

The Mineral Exploration industry in Australia sets the scene for the future development, production and export of mineral resources. Mineral exploration results in discoveries of the ore bodies that are subsequently exploited. Over the five years through 2012-13, revenue from mineral exploration activities has risen at an annualised 5.4%. This growth reflects much higher mineral commodity prices over the period. According to IBISWorld industry analyst Suzannah Rowley, “despite the overall growth, mineral prices have fluctuated substantially over the five years and industry revenue has tended to follow”. This has been a prevalent trend for base metals and iron ore products, which command a large portion of exploration activity. This is due to the ultimate reliance on demand flowing up the supply chain from global construction industries. Global construction activity declined in line with prices for iron ore and other base metals during the onset of the global economic downturn in 2008-09, and again in 2011-12 due to concerns over the US and European debt crises. Exploration revenue is expected to fall in 2012-13, largely in response to generally lower mineral prices.

Concentration in the Mineral Exploration industry is relatively low, as there are just two major players in the industry: BHP Billiton Limited and Rio Tinto Plc - Rio Tinto Limited. The relatively low level of concentration reflects the fact that nearly all mining companies undertake at least some exploration. “In addition, exploration is undertaken by small exploration-only operations and individuals engaged in fossicking”, says Rowley.

Mineral exploration revenue is expected expand slowly over the five years through 2017-18 as mineral prices remain subdued. This will constrain profitability. International demand for Australian minerals, especially from China, is forecast to remain strong over the next five years, keeping the industry afloat. The upswing in expected demand from China is likely to reflect increasing domestic spending on infrastructure projects. The general rise in international demand will occur due to a rebound in economic conditions across many countries and the expansion of other developing countries.

For more information, visit IBISWorld’s Mineral Exploration report in Australia industry page.

Follow IBISWorld on Twitter: http://twitter.com/#!/ibisworldau

IBISWorld industry Report Key Topics

Firms in this industry explore for minerals (except for crude petroleum or natural gas) either on their own account or one on a contractual basis. Essentially, the report covers the in-house exploration activities of mining companies as well as the activity of firms undertaking exploration on a fee or contract basis for other companies or firms providing exploration services.

Industry Performance
Executive Summary
Key External Drivers
Current Performance
Industry Outlook
Industry Life Cycle
Products & Markets
Supply Chain
Products & Services
Major Markets
International Trade
Business Locations
Competitive Landscape
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Basis of Competition
Barriers to Entry
Industry Globalisation
Major Companies
Operating Conditions
Capital Intensity
Technology & Systems
Revenue Volatility
Regulation & Policy
Industry Assistance
Key Statistics
Industry Data
Annual Change
Key Ratios

About IBISWorld Inc.
Recognised as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every Australian industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Melbourne, IBISWorld serves a range of business, professional service and government organisations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com.au or call (03) 9655 3886.

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Gavin Smith
IBISWorld
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