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Last Updated: Monday, 23 June, 2003, 09:43 GMT 10:43 UK
Australia's drought 'not over yet'
Drought-stricken Australian field
Two weeks on from declaring that Australia's punishing drought had run its course, the country's chief forecaster has changed its mind.

"The drought's not over," Terry Sheales, chief commodity analyst at the Australian Bureau of Agricultural and Resource Economics (ABARE), told the National Press Club in Canberra.

The change of tune came as ABARE warned that earnings from exporting commodities - including both farming products and mining output - would slide 5% in the year to June 2004, making a second successive year of downturn.

Australia gets about 10% of its output from commodities, and ABARE warned that the drought - coupled with the uncomfortable strength of the Australian dollar and the sluggish global economy - meant more pain to come.

After exports of more than A$90bn in 2001 and 2002, the financial year just ending is expected to show exports of just A$87bn.

The coming year was meant to be better, but ABARE now says that it is cutting its forecast by more than 5% to A$82.8bn - a 4.8% slide from 2003.


ABARE's about-face seems to dash hopes that Australia is recovering from the damage the long drought has done.

For some regions, water shortages have now lasted three years.

Some areas, particularly Western Australia, were on the mend, ABARE said.

But in parts of southeast Australia conditions were "very patchy", with some in even worse shape than a year ago, Mr Sheales said.

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