Trade deficit in September more than expected

Imports outweighed exports to widen the country's trade deficit; pictured, the container ship...
Imports outweighed exports to widen the country's trade deficit; pictured, the container ship Lica Maersk loading before dawn at Port Chalmers. PHOTO: STEPHEN JAQUIERY
New Zealand's annual trade deficit has widened more than expected to $5.2billion, its largest gap since early 2009.

Despite a boost in exports, led by fruit, in-bound oil, fuel and the cost of a one-off commercial airliner widened the deficit.

The deficit for September widened to $1.56billion. Imports were worth $5.18billion against exports of $4.32billion.

Westpac senior economist Michael Gordon said in seasonally adjusted terms, the deficit for September was $579million, compared with the $416million deficit for August.

"The trade balance tends to be at its most negative around this time of year, when agricultural exports are at a low ebb," he said.

Seasonally adjusted exports and imports gained strongly in September, in part due to the lower exchange rate, he said.

Exports grew by 9.2%, driven by dairy products, logs, fruit and machinery.

Imports rose by 11.2%, including a sharp jump in petroleum imports which could be "very jumpy" from month to month, he said.

"The import of a Boeing Dreamliner, worth $275million, also contributed to the wider deficit for the month," Mr Gordon said.

ASB rural economist Nathan Penny said he expected a "modest lift" to narrow the trade balance in the year ahead, as agricultural production rebounded.

However, he cautioned higher oil prices would keep that lift "gradual".

Statistics New Zealand international statistics manager Tehseen Islam said record imports in September led to the largest-ever monthly goods trade deficit, of $1.6billion.

"This month's record imports continue the high values seen since May 2018," he said.

The monthly imports value had been more than $5billion for the past five months, in part reflecting high prices for imported fuel and crude oil.

Mr Islam said the leading contributor to the rise in total imports was petroleum and products, up by $366million, or 87% from September last year; led by crude oil, up by $278million and fuels, up by $86million.

Exports were up $536million, or by 14%, to reach $4.3billion.

Mr Islam said the leading contributor to the rise in total exports was fruit, up by $188million or 118%, led by gold kiwifruit, up $122million, and green kiwifruit, up by $62million, he said.

Add a Comment