European Iron Ore

Question

Senator CANAVAN: I could speak for hours on this, but others probably aren't as excited as me. I get that the producers have that risk. Although, admittedly, in my discussions with them, I don't think they think that long term. Let's cut to the chase. The problem is that we have a risk. If there's conflict, if there are issues, we've got 80 per cent of our iron ore production-our biggest export by far-going to one country. Are we looking at what other markets we could develop for that industry? Senator Ayres: There are two kinds of diversification here that matter. Firstly, as Mr Mina has indicated, that market diversification question is a producer led discussion. In resources and in DFAT, there is close engagement with the companies over those questions. Secondly, there is a production diversification question. Again, this is more a question for me and my portfolio area, but the government's production incentives in iron production, for example, are about moving up the value chain in Australia's approach to iron. These are very significant investments that will be required to deliver future capability there, but they are all about that strategic issue that you have pointed to: overconcentration in particular markets for a very significant Australian export. Senator CANAVAN: Where does Europe get its iron ore from? It's a pretty big steel producer. As a group, it would be third or fourth. Mr Mina: We can probably come back to you on that, but it would obviously be- Senator CANAVAN: I'm just wondering. Did no-one say in the EU trade deal: 'Guys, you want us to rename everything. You want to bind us down with all these green shackles. Why don't you buy more iron ore from us?' Senator Ayres: I don't know about 'green shackles'.