Iron ore miners do heavy liftingTony BoydNot for the first time...

Iron ore miners do heavy lifting

Tony Boyd

Not for the first time over the past decade, China's demand for iron orehas propped up the economy and boosted corporate taxation receipts at a time when other sectors are struggling.

The iron ore miners – BHP, Rio Tinto, Fortescue Metals and Hancock Prospecting – are experiencing the strongest export market conditions for years. This is of enormous benefit to the economy as it deals with the harshest economic conditions in 75 years.

China's demand for iron ore is one bright spot in an economic statement with once-in-a-generation negative numbers. David Rowe

Treasurer Josh Frydenberg told a press conference on Thursday the mining sector was the one bright spot in the latest economic statement, which revealed gross debt would rise to about $852 billion by June next year as the country's pays for the cost of the coronavirus.

Debt to GDP is expected to hit about 50 per cent by 2021. It is a tribute to Australia's strong pre-COVID-19 financial position that this ratio is about half of that prevailing in the world's seven richest countries.

Strong iron ore exports mean higher profits and this, in turn, will mean rising tax revenue for the federal Treasury in 2020 and 2021. This is a welcome shot in the arm at a time when non-mining profits are down sharply.