Australian Mineral Exploration Review Natural Resources in the World

Question: Discuss about the Australian Mineral Exploration Review for Natural Resources in the World. Answer: Introduction: Australia is known for having ample amount of natural resources in the world. It is one of the significant exporters of minerals globally by producing around nineteen mineral resources. Among them some are scarce resources. All minerals are basically taken from approximately its four hundred operating mines. Country has the presence of mineral resources across all the states. Australian minerals are an important asset for its economy, as it contributes ten per cent of its gross domestic product (GDP) in the years 2012-13. Currently this has been reduced to around 8.5% of GDP (calculated on output) and employs about 220,000 people which are around 2% of Australian workforce. Australian mining activities not only help to accumulate the money from exporting its mineral across countries but also help to generate employment opportunities in the country. Around 266000 people directly employed through mining industry (Australian Bureau of Statistics June 2015). Gross value (real) added by Australian Industry: Annually total, as a % of total industry ending June 201415. Australian Industries Percentage of total Industry Other Services 11.80% Mining 9.30% Financial Insurance 9.30% Construction 8.20% Health Care Social Assistance 7.00% Manufacturing 6.60% Professional, Scientific Technical 6.40% Public Administration Safety 5.60% Education Training 4.90% Transport, Postal Warehousing 4.90% Retail Trade 4.80% Wholesale Trade 4.20% Information Media Telecommunications 3.20% Rental, Hiring Real Estate 3.00% Electricity, Gas, Water Waste Services 2.90% Administrative Support Services 2.90% Accommodation Food Services 2.60% Agriculture, Forestry Fishing 2.40% Total 100.00% Source: Australia- Benchmark Report As per the Bureau of Resources and Energy Economics (BREE) statistics, Australia is the largest mineral exporter, exported (excluding oil and gas) worth around $107 billion for the year of 2012-13. This export accounts for 59% of goods and services and 71% of merchandise exports. Countrys largest exporter for minerals and metals are China, Japan, South Korea and India. Some minerals like Nickel, LNG, and Garnet are found only in western part of Australia. Following table shows its mineral production by regions. Selected Australias regions commodities relative to world production ending 2014 Commodity Western Australia Rest of Australia Rest of World Zircon 11% 47% 42% Salt 5% 1% 94% Rutile 5% 57% 38% Nickel 8% 0% 92% LNG 6% 0% 93% Iron ore 37% 2% 61% Ilmenite 5% 11% 84% Gold 6% 3% 91% Garnet 17% 0% 83% Diamonds 14% 1% 84% Alumina 13% 6% 81% Sources: DMP, BREE, Energy Quest and USGS There is various trade theories have been propounded i.e. Absolute advantage, Comparative advantage, Factor Endowments and New Trade theory. But the Australian mining follows both the characteristics of Absolute advantage and Comparative advantage theory. For Scarce Earth Elements (SEE) it follows the theory of Comparative advantage and for other abundance minerals theory of Absolute advantage holds. The Absolute advantage theory advocates about the absolute advantages of the countrys commodity over others while Comparative advantage looks into in the Comparative aspects of the commodities over other countries. In both the cases there will be the terms of trade. Though Australia occupied a significant position in world for its mineral production, fails to contribute significantly in line with the largest scarce earth elements, SEE (include the lanthanide series usually scandium and yttrium). The largest SEE deposit is found in China a place called Bayan Obo. It contributes around 48 M tons of scarce earth oxides out of the world total of 95.27 M tons. Australias share of scarce earth oxides (SEO) to worlds economic resources is modest which accounts 1.65 M tons. Up to year 1995 Australia was the lead producer of scarce earth oxides. This scarce earth oxides extraction is basically from monazite (elements of the byproduct of heavy minerals such as sand mining for ilmenite, rutile zircon). Historically, Australia was the significant exporter of monazite. This monazite is basically come from heavy mineral sands mine. During 1952 to 1995 the export of monazite was around 265 kilotons. Scarce earths made up with a group of 15 elements with its a tomic number starts from 57 to 71 (lanthanum, cerium, praseodymium, promethium, uropium, gadolinium, terbium, holmium, erbium, thulium, ytterbium etc.). It is basically an ample group of elements, ranging from cerium at 60 parts per million to lutetium at 0.5. Scandium and Yttrium are known for scarce earths element because of its composition with scarce earths. The larger demand for scarce earth oxides is attributed due to future expansion in hybrid transport vehicles followed by petroleum, glass, polishing other electronic machineries. Europium and terbium which are known for its precious value, small in their volume are used in the production of phosphors. This is widely used for televisions and energy efficient light purpose globally. Presently there is few scarce earth production in Australia, mining started in the year 2007 at the place called Mount Weld deposit, situated in the region of Western Australia. The resultant outcomes around 98,000 cubic meters of ore being accumu lated and expecting to its ending of a concentration plant at the mining site. The accumulation will be exported to an innovative materials plant that is being built in Malaysia. There is one scarce earth oxides extraction project going on in Western Australia and feasible research undertaken in some part of Australia like the Northern Territory and New South Wales. We can expect that the country becomes a scarce earth oxides exporter once again in future. The production for scarce earths started at small scale in Australia. It is located at Byron Bay in New South Wales. A small amount of monazite is being processed in order to produce cerium oxide which is useful for the purpose of glass polishing. In the year 1969, Port Pirie (in South Australia) was known for its production of various compounds like cerium, lanthanum, yttrium and thorium, stopped its operations in 1972. In past decades it has been noticed that there has been strong growth registered in favor of scarce earths. This demand for scarce earths is because of emerging technology and its application used in the field of glass, polishing, metal alloys and magnets sectors. It accounts 80% of the total market demand of around 124,000 tons of scarce earth oxides. Australian bodies such as Mineral Exploration Review and Australias Identified Mineral Resources annually review the highlight of mineral exploration which also includes scarce earth oxides. Conclusion: In spite of having richness of mineral resources, Australias economic performance has been impugned. During the nineteenth century Australia was the leading producer of scarce earth oxides but it was an incompetent in other minerals, mainly bauxite, coal, and iron ore. A country like Australia which has strong mining sector, why this has been so? The factor may be its small population. Australia has small population to its area and adverse climatic condition, desert regions always the reason for discouragement to the labor mobility across globe. Its adding a pressure on its old demographic generation. A growing number of world researches highlight that natural resource abundance country predominantly mineral has adverse consequences for countrys economic growth (Gavin Wright and Jesse Czelusta, October 2003). References: Australian Mineral Exploration Review Geoscience Australia. Australias Identified Mineral Resources Geoscience Australia. Arafura Resources Ltd, 2012. Australian uranium and rare earths conference 2013 16-17 July 2013, Fremantle, 15 pp. Blainey, Geoffrey (1993). The Rush That Never Ended: A History of Australian Mining. Barrie, J., 1965. Scarce Earths, In: McLeod, I.R. (editor), Australian Mineral Industry: The Mineral Deposits. Bureau of Mineral Resources, Australia, Bulletin 72, 515521. Crossland Uranium Resources Ltd. 2012. Announcement to the Australian Securities Exchange 5 April 2012, 3pp. Hoatson, D.M., Jaireth, S. and Miezitis, Y., 2011. The major scarce -earth-element deposits of Australia: geological setting, exploration, and resources. Geoscience Australia, 204 pp. Maxwell, Philip (2006), Trade in minerals, in Philip Maxwell, ed., Australian Mineral Economics: A Survey of Important Issues, Carlton, Australia, The Australasian Institute of Mining Metallurgy, pp. 27-34.