Sharechat Logo

NZ August trade deficit tad wider than expected on more imports

Wednesday 25th September 2019

Text too small?

New Zealand’s August trade deficit was $1.6 billion, slightly wider than economists had expected, as imports came in higher than forecast.

Economists polled by Bloomberg had expected a monthly deficit of $1.4 billion and an annual deficit of $5.4 billion. The annual deficit came in at $5.48 billion, Stats NZ said.

Exports rose 3.8 percent, or $151 million, to $4.1 billion in August from a year earlier. Imports, meanwhile, rose $149 million, or 2.7 percent, to $5.7 billion.

Economists had expected exports of $4.1 billion but imports of $5.58 billion. "Higher than expected petroleum import values accounted for much of the surprise versus our forecast," said ASB Bank's rural economist Nathan Penny. 

The lift in imports was led by a rise in intermediate goods, including crude oil, aircraft parts and fertilisers.

Imports from China rose 4.9 percent to $1.1 billion in August. They are up 11 percent in the 12 months ended August at $13 billion. Imports from Australia, New Zealand’s second-largest trading partner, lifted 5.2 percent to $704 million on the month.

On the export side of the ledger, the leading contributor to the rise was crude oil exports, up $58 million at $68 million.

The increase was due to low quantities of crude oil exported in August 2018. Exports of crude oil fluctuate from month to month and can mean large rises or falls in monthly values, Stats NZ said.

Fruit exports lifted 18 percent to $371 million, with gold kiwifruit up $26 million, or 18 percent in value and 15 percent in quantity. Apple exports rose $23 million, or 63 percent in value and 41 percent in quantity.

Preparations of milk, cereals, flour, and starch rose $49 million to $202 million. This commodity group includes infant formula.

Milk powder, butter, and cheese rose $32 million or 6.2 percent to $547 million. August is typically the lowest month for exports of this commodity group.

Penny still expects the annual trade balance to narrow as New Zealand's food export value growth remains firm. "Notably, NZ food exports remain relatively healthy despite softening global growth," he said. 

In the other direction, liquefied natural gas exports fell $73 million. There were no exports of this commodity this month.

Untreated logs fell $51 million, or 17 percent in value and 4.1 percent in quantity.

Exports to China lifted 13 percent to $1 billion, led by beef, kiwifruit and milk powder.

Exports to Australia lifted 6.8 percent to $801 million, led by rises in crude oil.


NOTE: please be advised to read full articles from Business Desk Website, you will have to pay a subscription fee on their website.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

NZ dollar consolidates weekly gain of more than a US cent
NZ dollar holds gains on improved dairy, bank capital outlook
MARKET CLOSE: NZ shares gain; banks rally on Reserve Bank capital decision
NZ dollar rises; bank capital rules less harsh than expected
RBNZ relaxes capital requirements, allows preference shares, extends phase-in
NZ dollar extends gain amid mixed US data, possible trade progress
MARKET CLOSE: NZ shares dip on eve of major regulatory decisions
NZ dollar sees off global headwinds, holds above 65 US cents
NZ dollar holds above 65 US cents; dairy auction prices mixed
Dairy index falls on weaker butter, milk fat demand

IRG See IRG research reports