As the next financial year approaches, IBISWorld has investigated which industries stand to grow fastest in 2021-22. The recovery from the pandemic is the dominant theme among the fastest growing industries, with the rollout of the COVID-19 vaccine expected to enable tourism and large gatherings to resume. Amid this backdrop, some of the fastest growing industries in 2021-22 include International Airlines, Cotton Ginning, Cinemas, Battery Material Mining, and Port Construction.
International airlines
Revenue for the International Airlines industry is expected to surge by 78.4% in 2021-22, to reach $14.7 billion. This represents a strong rate of growth, but is only a partial recovery relative to the highs achieved prior to the COVID-19 pandemic. In 2018-19, revenue grew by 4.7% to reach $29.7 billion.
The number of international tourist visitor nights is expected to jump to 213.9 million in 2021-22, after falling to a record low of 36.5 million in the previous financial year. Over the next five years, the number of inbound tourists to Australia is projected to gradually recover. However, this recovery will likely be hindered by lingering travel restrictions from countries that have yet to fully vaccinate their populations. Industry revenue is forecast to rise at an annualised 29.7% over the five years through 2025-26, to $30.2 billion.
Cotton ginning
The Cotton Ginning industry is one of many agricultural industries to benefit from growth in rainfall across the eastern seaboard, which has driven up yields and provided much-needed assistance to Australian farmers. Revenue is expected to rise by 71.6% in 2021-22, to $1.4 billion.
Prior to 2020-21, drought across many cotton growing regions in New South Wales and Queensland caused cotton farm output to decline sharply. However, drought conditions have since lifted, leading to more farmers planting cotton in the current season, which is expected to support greater demand for cotton ginning services in 2021-22.
Wide profit margins in the Cotton Growing industry are expected to encourage farmers, particularly irrigators, to grow cotton when water availability increases. Demand for cotton from overseas textile industries is forecast to grow, despite uncertainty surrounding exports to China amid rising trade tensions with Australia. Overall, industry revenue is anticipated to increase by 25.1% over the five years through 2025-26, to $2.5 billion.
Cinemas
Revenue for the Cinemas industry is expected to surge by 69.6% in 2021-22, to reach $1.1 billion. The releases of many major blockbuster films have been postponed during the COVID-19 pandemic, as social gathering restrictions have prevented cinemas from operating. However, as major economies gradually ease their social distancing restrictions in the coming year, many of these films will likely be released. In addition, new films have continued to be developed during the pandemic. As a result, 2021-22 is projected to packed with frequent major film releases.
However, ongoing consumer caution about social gatherings, particularly for those who have yet to be vaccinated, is expected to hinder the industry’s recovery. The adoption of subscription video on demand services throughout the pandemic is also anticipated to hinder long-term growth, as more consumers forgo the cinema experience in favour of home viewing. Overall, industry revenue is forecast to increase at an annualised 21.1% over the five years through 2025-26, to $1.7 billion.
Battery material mining
The Battery Material Mining industry has only been moderately disrupted by the COVID-19 pandemic, and is expected to resume its pace of strong growth in the upcoming financial year. Revenue is expected to grow by 52.7% in 2021-22, to $2.5 billion. Unlike other industries disrupted by COVID-19, revenue only declined by 2.9% in 2020-21, as the opening of new lithium mines offset a decline in lithium prices.
Demand for battery materials, particularly lithium and cobalt, is projected to continue rising in response to the uptake of electric vehicles (EV). Uptake of EVs will likely accelerate over the next few decades, with the volume of sales likely to surpass sales of internal combustion engine (ICE) vehicles by 2050. Australian cobalt supply is forecast to rise over the next five years, due to the additional capacity of new mines. The first of these mines is Clean Teq's Sunrise project, which is anticipated to achieve first production in 2021-22.
Industry revenue is expected to rise at an annualised 22.1% over the five years through 2025-26, to $4.4 billion. New enterprises are projected to enter the industry, producing battery materials such as vanadium and high-purity alumina.
Port construction
Revenue across the Port Construction industry is forecast to rise by 32.2% in 2021-22, driven by several major projects. These include the Port of Townsville's Port Expansion Project, the Glebe Island Multi-User Facility in Sydney, the expansion of the Hay Point Coal Terminal near Mackay, and the planned expansion of the Anderson Point facilities at Port Hedland.
Several port developments for passenger ships are also planned and may provide scope for industry expansion over the next five years. This includes the possible cruise terminal sites at Yarra Bay and Molineux Point in Sydney, and the possible ocean-side Cruise Ship Terminal on the Gold Coast, QLD.
Continued growth in the total mass of exports by sea, and expansions to accommodate increasingly large freight and passenger ships are forecast to drive growth in the industry over the next five years. Overall, industry revenue is forecast to increase at an annualised 3.1% over the five years through 2025-26, to $1.3 billion.
IBISWorld reports used to develop this release:
- International Airlines in Australia
- Cotton Ginning in Australia
- Cinemas in Australia
- Battery Material Mining in Australia
- Port Construction in Australia
For more information, to obtain industry reports, or arrange an interview with an analyst, please contact:
Jason Aravanis
Strategic Media Advisor – IBISWorld Pty Ltd
Tel: 03 9906 3647
Email: mediarelations@ibisworld.com
