And miners aren’t alone

IT’S not only BHP and Rio that are “long China”.

In a way, Australia even more so.

They just have to keep selling iron ore – and in the case of BHP, also coal – to China. Add on the sales to even longer-term customers Japan and Korea, and those steel-make ingredients are easily our biggest export earner.

Brutally, no iron ore and coal sales (or much lower prices); no cheap cars and computers – and all the rest of those cheap goods.

But Australia more broadly also has to keep selling tourism and education to China. is

China is easily the biggest customer for both.

We also have to keep selling old and new property to them.

The good prices that BHP and Rio are still getting for their sales showed up in their individual numbers.

The good prices that Australia is getting for those commodities when counted as exports showed up in the RBA’s index of commodity prices.

These commodity prices are running around 35-40 per cent down from their post-GFC peak, when China went really gangbusters.

But interestingly and very encouragingly, they seem to have levelled off.

That would mean Australia continuing to get roughly double the prices we used to get for our commodity exports in the early 2000s but getting those prices at vastly higher volumes.

There’s a further interesting – and, I would suggest, more than just a – coincidence.

Commodity prices have levelled off pretty much in tango with the RBA leaving its official interest rate unchanged at 1.5 per cent.

More broadly, that’s a pretty good combination: both the levels and their steadiness at those levels, one high and one low.