RDP 2013-02: Industry Dimensions of the Resource Boom: An Input-Output Analysis Appendix B: Final Demand Data

This Appendix describes how we construct the sub-industry level data for final demand related to the output of the resource extraction sector. The construction of the data related to the final demand for resource investment is described in Section 2.5. All data are valued in basic prices (i.e. excluding trade and transport margins, and taxes less subsidies on products).

Household consumption: Data on household demand for the output of the resource extraction sector are provided in I-O tables. Most of this represents demand for refined petroleum, including automotive fuels such as petrol, diesel and liquefied petroleum gas. To estimate the demand for refined petroleum in years for which an I-O table is not available, we interpolate and extrapolate the series using unpublished ABS data for motoring fuel consumption (ABS Cat No 5206.0).

Household final demand for oil and gas (e.g. mains gas at residential dwellings) is also measured using data from I-O tables and interpolated and extrapolated using ABS data on household consumption of electricity, gas and other fuels (ABS Cat No 5206.0). Other components of household consumption are calculated using the data from I-O tables, and are interpolated and extrapolated using total household consumption.

Private investment: Mining investment data (by type of asset) are published in the Australian System of National Accounts (ABS Cat No 5204.0). We allocate all the mining investment in mineral & petroleum exploration to the exploration & other mining support services sub-industry. The remaining components of mining investment (i.e. research & development and computer software investment) are allocated to each sub-industry of mining based on the shares given in I-O tables. Investment related to the output of the sub-industries of resource-specific manufacturing is taken from I-O tables, and extrapolated and interpolated using total private investment.

Note that investment related to the output of the resource extraction sector is different to the investment associated with expanding and updating capacity in the sector, such as resource-related construction and machinery & equipment investment (see footnote 9).

Public demand: Public demand for the output of the resource extraction sector is constructed by interpolating and extrapolating the data in I-O tables by growth in total public demand.

Changes in inventories: We assume there are no changes in resource extraction inventories from year-to-year. While data on mining inventories are published in the national accounts, these data are prone to substantial revision, so the current vintage of data bears little resemblance to the changes in mining inventories published in historical I-O tables.

Exports and imports: To provide a fine level of disaggregation of exports and imports we use detailed data from the ‘International Trade in Goods and Services, Australia’ (ITGS) release (ABS Cat No 5368.0). The ITGS release provides trade data at the 3-digit Standard International Trade Classification (SITC) level, which is the minimum level of disaggregation required to individually identify the exports and imports of the nine resource extraction sub-industries used in this paper.^[26]

We map the Input-Output Industry Groups to the Australia and New Zealand Standard Industrial Classifications 2006 (ANZSIC06) using concordance tables published by the ABS. The 3-digit SITC codes are then mapped to the ANZSIC06 groups using a concordance table that was provided by the ABS on request. By doing this, we are allocating exports to the industry that performed the final activity required to complete the extraction or processing of the commodity in question. Imports are allocated to the industry that is most likely to have produced goods equivalent to those imported. These allocations are listed in Table B1.

We make further adjustments to the ITGS data to improve their consistency with I-O tables. First, since the exports data in the I-O tables are measured in basic prices, we need to adjust the ITGS exports data – which are valued in purchasers' prices – for trade and transport margins. This adjustment is based on the detailed data on margins provided in the I-O tables, or the average of nearby tables for years in which no tables are available. We then allocate these margins to the industry that provided the service, which is primarily the transportation industry, and to a lesser extent, the wholesale and retail trade industries.

Second, we re-classify imports of non-monetary gold from the manufacturing sector to the mining sector. This reflects the role of the Perth Mint, which is accredited by the London Bullion Market Association in refining gold for global markets; gold is imported into Australia as gold ore, refined, and exported as a manufactured product.^[27] Following the ABS, all exports of gold are treated as a manufactured export (allocated to the basic non-ferrous metal manufacturing industry).

Third, we subtract goods procured in ports by carriers (i.e. ship and aircraft stores) from exports and imports of refined petroleum products in ITGS. These data are sourced from the ‘Balance of Payments and International Investment Position, Australia’ release (ABS Cat No 5302.0).

Footnotes

The ITGS release also provides trade data at the ANZSIC industry level, however in some cases these data are not provided at a disaggregated enough level for our purposes. [26]

We use the Balance of Payments and International Investment Position data for non-monetary gold exports and imports in place of the SITC codes 951 and 971 due to various confidential adjustments made to the former series by the ABS. [27]