Survival of the fittest: A postcard from Australia’s resource-centric North West

• The Economist this week carries a topical article on commodities, “Goodbye to all that: a decade of binging on raw materials may leave an even longer hangover”, outlining the pressure on producers now from declining prices. And that’s how it’s playing out locally as Australia’s bulk commodity and energy producers seek efficiencies in a survival of the fittest

• Having just returned from a visit to the north west of WA – to Karratha and Port Hedland – the pressure is on but activity and exports remains strong. In economic terms, economists call this the net export contribution to GDP, set to continue contributing up to 2 percentage points to GDP, with prospective growth coming from LNG as it takes over from iron ore as the growth driver. (Together with this below postcard from the West, please refer to David deGaris’ presentation, available here, to clients and guests in Karratha and Port Hedland.)

• In addition to the presentations and meetings in the North West, we first visited clients in Albany in the South of WA, a town centred around local farming, especially wheat. Growing conditions for the current wheat crop have started positively and a pull-back in labour demand from the mines has freed up costs.

For a full synopsis of the markets this week download:

• Australian Weekly Markets: August 24 2015 (PDF, 639 KB)

For further FX, Interest rate and Commodities information visit nab.com.au/nabfinancialmarkets

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