Australia has the opportunity to continue to be a major exporter to China if it can contain costs and enhance productivity, he said.
“As a major iron producer and the world’s largest exporter of iron ore and metallurgical coal, developments in China’s iron ore and steel sectors have important implications for Australia’s trade and investment interactions with China,” Wilson said.
“While China’s steel consumption growth is expected to moderate, it is expected to remain the major driver of global demand for Australian iron ore over the short to medium term.
“Australia should have the productive capacity to meet demand from China.”
China is Australia’s largest trading partner after the relationship between the two countries grew rapidly over the past two decades.
In 2012-13, combined export and import merchandise trade between the two countries was worth $122.8 billion. Australia’s largest exports to China were iron ore, coal, gold and crude petroleum.
China is the main export market for Australian iron ore, with about 74% of exports of the steel-making material headed to the Asian nation.
As of April, Australia had eight new major iron ore projects under construction, which could add about 157 million tonnes to annual iron ore exports, or a 19% increase in volumes from 2012.
Regular data and analysis on developments in China’s economy and the resources and energy sectors are available in the Westpac-BREE China Resources Quarterly.
The future of trade between Australia and China will be a key theme discussed at the upcoming Australian National Conference on Resources and Energy 2013 in Canberra.