"Supported by strong world economic growth, higher export earnings from mineral resources will continue to underpin commodity sector performance," said Karen Schneider, acting Executive Director of ABARE, when releasing the report today.

The value of Australia's minerals and energy exports is forecast to be around $108 billion in 2006-07, a rise of 18 per cent from $92 billion in 2005-06.

The price OUTLOOK across mineral resources remains positive, reflecting continued strong world demand and modest growth in supply. Following significant rises in 2005-06, further price increases in 2006-07 are forecast for many mineral commodities, including iron ore, gold, aluminium, nickel, copper and zinc. In addition to higher prices, the volume of Australian mineral resources exports, in aggregate, is forecast to rise markedly in 2006-07.

In the farm sector, export earnings are forecast to be around $28.3 billion in 2006-07, a rise of 2.1 per cent from 2005-06. Agricultural commodities for which export earnings are forecast to increase in 2006-07 include wheat, rice, wine, live cattle and cheese.

For farm commodities as a whole, the index of unit export returns is forecast to rise slightly in 2006-07, after a marginal decline in 2005-06.

"Although world indicator prices are forecast to average higher in 2006-07 for wheat, corn, soybeans and cotton, the effects on farm incomes are expected to be more than offset by a forecast decline in crop production," Ms Schneider noted.

Total winter crop production in Australia is forecast to be significantly lower than in the previous season, mainly as a result of below average winter rainfall across the Australian grains belt.