Aus bulk commodity exports: May

Australian coal and iron ore exports continued to grow solidly on tonnage terms in May.  Coking coal in particular was very strong, surging above levels seen in 2010.  Preliminary shipping data suggests coking coal shipments remained strong in June, although steam coal was a bit weaker.

It is difficult to disaggregate how much of an impact lower prices are having on supply of coal.  For coking coal, on the whole exports have come back to around 2010 levels, with some operations recovering beyond what they were doing pre the terrible floods, whilst other have been shut down.

For thermal coal, infrastructure expansions are reaping benefits, although growth rates should drop towards zero heading into the start of next year. Many planned expansions of existing operations for next year have been put on the backburner, but so far there are few causalities in terms of current supply.

Iron ore continues to rise strongly as well and there are additional expansions still in train over the next few years to keep current momentum going.  Brazillian ore exports were a little better in May, although are still down for the year as a whole by 2%.