Declining dairy exports to China have led to a 9.5% fall in goods exports during November.
While exports were down, imported goods fell 1.3% to $4.2 billion, leaving the monthly trade balance for November with a deficit of $213 million, or 5.3% of exports, according to Statistics New Zealand (SNZ).
Lower oil imports explained much of the weakness, plunging from an average of $670 million in September and October to just $404 million in November, the ASB said.
The smaller-than-expected $213 million deficit appears to have taken some analysts by surprise.
SNZ international statistics manager Jason Attewell said the trend for exports to China was 42% lower than the series peak in December 2013, and was now at similar levels to 2012.
''Dairy exports drove the fall, down 27%, with the quantity down 3.1%.
''The fall in dairy reflects the record high levels exported, mainly to China, in November 2013,'' Mr Attewell said in a statement yesterday.
The export decline was partly offset by a 20% rise in meat exports, led by a price-driven rise in frozen beef, he said.
''Record high exports late last year resulted in the first trade surplus for a November month, of $153 million, since 1991,'' he said.
ASB senior economist Jane Turner said the November trade deficit was narrower than expected, with a deficit of just $213 million, compared with market expectations for a deficit of $575 million and ASB's forecast of a $900 million deficit.
''Exports for November were largely in line with market expectations, while imports came in weaker than expected,'' she said in a statement. Imports were much weaker than is typically the case in November, falling 7.7% on a seasonally adjusted basis, she said.
''This weakness appears to be due to volatile items and we expect the softness in imports to be temporary,'' Ms Turner said.
She said the lower oil prices and the lumpy nature of oil imports appeared to contribute to lower oil import values in November.
Dairy exports fell, Ms Turner said, although not by as much as expected.
''While prices declined, volumes lifted 4%, reflecting strong milk production due to good pasture conditions.
''We expect further declines in dairy exports as prices ease over this season and production starts to taper back early next year,'' Ms Turner said.
Meat exports surged 10%, on a seasonally adjusted basis, owing to strong volumes and prices, she said.
International beef prices were currently ''very high'' because of tight global supply and was encouraging an increase in slaughter.
''Stronger meat exports are providing some offset to the decline in dairy exports,'' she said.
Exports v imports
November v November
• Exports down $421 million, or 9.5%, to $4 billion.
• Fall led by powdered milk, butter and cheese.
• Imports fell $54 million. or 1.3%, to $4.2 billion.
• Fall led by capital goods (aircraft).
• Trade deficit was $213 million, or 5.3% of exports.
SOURCE: SNZ
