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Australia is a leading producer of minerals for the world and produces some 22 minerals in significant amounts from more than 300 operating mines. Minerals are produced in all States and the Northern Territory. There is no mining in the Australian Capital Territory apart from quarries used to mine aggregate and other construction materials.

Minerals are an important part of the Australian economy, accounting for about seven per cent of gross domestic product (GDP). The Australian Bureau of Agricultural and Resource Economics and Sciences (ABARES) reports that mining employs around 167 000 people directly. In addition, the Minerals Council of Australia states that there are a further 153 000 employed indirectly by the industry.

Minerals are Australia’s largest export. According to ABARES, the industry’s exports were worth approximately $114 billion in 2009 (excluding petroleum), accounting for around 46 per cent of total exports and 58 per cent of merchandise exports. Australia mining companies trade freely in the global marketplace, exporting goods on a commercial basis around the world with the major markets for Australian mineral exports being Japan, China, Korea and India.

Australia is in the top five mineral producers and has a large inventory of resources of most of the world’s key minerals commodities. Australia is the world’s leading producer of bauxite, alumina, rutile, and zircon; the second largest producer of gold, iron ore, lead, zinc, lithium and manganese ore; the third largest producer of uranium; the fourth largest producer of nickel; and the fifth largest producer of aluminium, brown coal, industrial diamond and silver(Table 1). Australia also has the largest identified resources of lead, nickel, rutile, silver, uranium, zinc and zircon, and the second largest resources of bauxite, copper, gold, iron ore, niobium and tantalum. Australia’s lithium resources are ranked third, and black coal resources ranked fifth in the world (Table 1).

Resources and Production

Geoscience Australia compiles and reports on an annual basis the national inventory of mineral resources from information released publically by mining companies in Australia’s Identified Mineral Resources. Geoscience Australia also provides national scale maps showing Australia’s mineral deposits and endowment by region for a wide range of mineral commodities.

Australian mineral production and exports are reported quarterly by ABARES in Australia’s Mineral Statistics. The outlook for commodity prices and Australia’s exports are given in the ABARES Commodity Outlook.

History and Use

Mining in Australia dates back to around 1800 when coal was mined near Newcastle. Metal mining commenced with mining of lead at Glen Osmond (South Australia) in 1841 followed by copper shortly after at Kapunda (South Australia) in 1842. Gold mining played a major role in Australia’s development following the initial gold rushes near Bathurst in New South Wales and Ballarat and Bendigo in Victoria in the 1850s-1860s, and at Coolgardie and Kalgoorlie in the Eastern Goldfields of Western Australia in the 1890s. Mining of the major base metal deposits of Broken Hill discovered in 1883, and Mount Isa (1923) and the Golden Mile at Kalgoorlie (1893), which now operates as the Super Pit, continues today and continues to be responsible for the development of these regional cities. Other mining developments of major national economic significance were the expansion of the coal mines of the Hunter Valley and Bowen Basin, and the iron ore mines of the Hamersley Basin in the 1960s and 1970s. Further details on the history of Australian mining is provided in the Australian Mines Atlas.

Minerals are essential to modern living and have a very wide range of applications, including coal for fuel for electricity and steel  production and ores for the production of a wide range of metals and mineral products including iron ore to produce steel used in construction, ships motor vehicles, and machinery, bauxite for aluminium, copper for electrical wiring and plumbing and metals for a wide range of alloys, such as nickel for  stainless steel. Metals such as niobium, tantalum, and rare earths are used in  high-technology applications such as mobile phones, magnets and batteries. Further details are given in the Australian Mines Atlas Minerals Fact Sheets.

Extraction of all minerals follows a similar path commencing with exploration using a range of geological, geophysical and/or  geochemical tools followed by drilling to find and evaluate mineralisation. If these steps provide promising results, more detailed work is undertaken to estimate  the size and quality of the resource. This is followed by a pre-feasibility  study to asses the economic potential of the identified resource. If favourable, a feasibility study is undertaken to assess the commercial  viability of mining the resource, including mine planning to evaluate the commercially recoverable part of the deposit, the metallurgy, value and market potential of  the mined ore, the full costs of mine development  including infrastructure, mining, milling, and recovery of the ore, the cost of finance and mine closure and rehabilitation.

The largest importers and consumers of minerals and metals are China, the USA and Japan. Australia’s coal and iron ore are generally traded between supplier and consumer based on a negotiated contract price set quarterly based on various benchmarks. Most base metals (copper, lead, zinc, nickel) are traded internationally on the London Metal Exchange with smaller volumes sold directly or through the smaller Comex and NYMEX exchanges in the United States and the Shanghai Futures Exchange in China. Other commodities are generally sold outside the international clearing schemes by direct sales at negotiated prices. The market for a number of smaller volume commodities is dominated by a single or small number of dominant suppliers.