Australia will report a smaller revenue upgrade in its federal budget for the year ended June 30 than it posted the prior year due to falling commodity prices and a softening labour market, the country's Treasurer will say on Thursday.

Booming commodity prices saw major exporter Australia report a revenue upgrade of more than A$100 billion ($66.12 billion) in 2022-2023, a feat that is unlikely to be repeated for 2023-2024 in tandem with its budget announcement in May, according to Treasurer Jim Chalmers.

"The revenue upgrades will be smaller," Chalmers will say in a speech on Thursday, according to an advance copy seen by Reuters.

"In each of our first two budgets we benefited from more than A$100 billion in revenue upgrades. This year, we won’t see anything like that.

"In fact we are even looking at much less than the A$69 billion we booked in the latest mid-year budget update."

Key to the smaller upgrades are commodity prices, Chalmers will say, with iron ore spot prices down almost 10% in the last week alone due to concerns about the demand for steel in China.

The price of thermal coal, another key Australian export, is down by a third in the last year, he will add.

Australia's jobless rate hit a two-year high in January, meaning revenue upgrades from increased employment were unlikely, though Chalmers will say the employment rate was a head of Treasury forecasts.

"We welcome this, but we don't expect to get such upside forecast surprises this time around," he will say. ($1 = 1.5124 Australian dollars) (Reporting by Alasdair Pal in Sydney; Editing by Jamie Freed)