As a result, there are likely to be changes to Australian industries in the coming years, especially those which rely on equipment and resources.
It is likely that many of these industries will have to adapt to rising costs, potentially even importing cheaper equipment/resources from abroad. Here are some of the industries which may be affected by higher prices/changes to the economy.
Mining
Mining has always been a huge part of Australia's economy, providing jobs and resources for the country. After commodity prices rose significantly, they started to fall rapidly in 2009. Now the economy is looking like it will place a heavier emphasis on services in sectors like tourism, which could have implications for industries like mining.
It is worth noting, however, that the price for commodities still remains high globally, and rare commodities like precious metals rarely see a reduction in their core value. Gold prices, for instance, usually rise in times of crisis.
Property
Surges in demand for housing and rapid growth are swiftly making the property sector one of the most expensive sectors to be involved with. Buying a house as an investment in Sydney is now likely to set you back at least $852,000 on average, a number which seems excessively large.
This will undoubtedly push up prices for the construction industry too, which will no doubt be paying higher prices for land in the future. It remains to be seen whether these high prices will remain, or whether they stifle demand and eventually fall.
Plastic
The plastic manufacturing industry, which makes items like milk bottles and pipelines, requires a lot of heat and energy to make their products. This is normally provided by Australian gas, which, to local businesses, is now double the price of the gas which is exported to other countries.
Businesses like foundries and food processors are struggling as a result, since these gas exports are causing a shortage in Australia. Unless this is addressed, gas reliant-businesses such as plastic could well start disappearing as they cease to be able to fund their day to day operations. This could in turn cause other industries which use plastic products extensively to suffer due to shortages.
Jarrah Honey
The jarrah honey industry is unique and fairly new, and jarrah honey itself is much sought after by countries like Japan and China. However, diminishing supplies as a result of continued harvesting and recent bush fires are causing major problems for the industry. The price of the honey is set to rocket up, which means demand will most likely fall significantly and could threaten the future of the industry.
The fact that jarrah honey is harvested biennially means that harvesters have to wait a significant period of time before they can produce more honey after a weak season, so there is a lot of uncertainty over the future of its production.
The businesses which operate in these industries are varied and wide ranging in the products/services they offer, and not all of them will suffer from the same problems. It is likely that most of the industries will continue to operate as normal despite facing differing levels of uncertainty, and in time solutions will be found for the problems which they currently suffer from.
* Source: https://www.numbeo.com/cost-of-living/country_result.jsp?country=Australia
