Overseas Merchandise Trade: October 2009

Commentary

Information in this release is for the month of October 2009 compared with October 2008 unless otherwise stated.

Exports

The value of merchandise exports for the month of October 2009 was $3.0 billion, down $859 million (22.4 percent) from October 2008.

After rising steadily from mid-2007, the trend for total merchandise exports has been declining and is down 15.4 percent since its peak in November 2008. The level of the trend is now comparable to what it was in August 2007. This is the sharpest fall seen in the trend since the series began in 1988, and is smaller only than the fall of 16.5 percent that occurred in the trend over 25 months between mid-2001 to mid-2003. 

Key decreases and increases in exports by commodity and by country of destination were as follows:

By commodity:

  • Milk powder, butter, and cheese showed the largest decrease in October 2009, down $318 million (32.0 percent). This decline was led by whole milk powder, down $126 million (35.1 percent), due to lower prices, with quantities exported up 36.4 percent. Large decreases were recorded for several other commodities, including cheese, down $92 million (led by cheddar cheese); and anhydrous milk fat, down $37 million.

 

 Milk Powder, Butter, and Cheese Exports - Monthly values and quantities

 

  • Crude oil was the next largest fall, down $138 million (55.2 percent), with overall quantities exported down 29.4 percent.

Crude Oil Exports - Monthly values and quantities

  • Casein and caseinates recorded the third largest decrease, down $45 million (43.3 percent).
  • Aluminium and aluminium articles fell $42 million (33.7 percent), the next largest decrease. This fall was led by unwrought aluminium, down $41 million (39.1 percent) with quantities down 6.3 percent.
  • By comparison (in the few instances where a commodity category showed an increase) increases were of a much lesser magnitude compared with the declines. Petroleum and products other than crude oil showed the largest increase, up $22 million (from a low level), led by bituminous mixtures, up $13 million. The next largest increases were exports of beverages, spirits, and vinegar, up $4 million (27.5 percent), and wine, up $4 million (3.5 percent).

By country of destination:

  • Exports to Australia showed the largest decrease, down $180 million (19.1 percent), led by crude oil exports, down $160 million.
  • The second largest decrease was in exports to Japan, down $146 million (41.3 percent). Two significant contributors to this fall were milk powder, butter, and cheese, down $35 million (led by cheese); and aluminium exports, down $27 million (led by unwrought aluminium).
  • The third largest decrease was in exports to the United States of America, down $82 million (24.2 percent), with casein and caseinates down $26 million (50.8 percent), and milk powder, butter, and cheese down $26 million (40.2 percent), led by anhydrous milk fat, down $12 million (63.5 percent).
  • The largest increase was in exports to the People’s Republic of China, up $45 million (20.5 percent). Monthly exports to the People’s Republic of China (versus the same month of the previous year) have increased for the past 19 months in a row. This month’s increase in exports was driven by milk powder, butter, and cheese, up $40 million (96.8 percent), led by whole milk powder (up $33 million or 181 percent) with quantities up fivefold.

Imports

In the month of October 2009, merchandise imports were valued at $3.5 billion, down $1.4 billion (28.3 percent) from October 2008. Excluding one-off imports, import values have now fallen by 19 percent or more for each of the last seven months, when compared with the same month of the previous year.

The trend for merchandise imports has been decreasing since peaking in August 2008, and is down 25.3 percent since then. This is the longest period of decline and the largest fall in the imports trend since the series began in 1988. 

All of the main broad economic categories were down in October 2009 compared with October 2008. 

  • The intermediate goods category recorded the largest decrease, down $982 million (39.7 percent). Falls were widespread in this category, with crude oil, down $251 million (48.5 percent), being the largest, mainly due to lower prices. Other commodities showing significant declines included oil cake for animal food, partly refined crude oil, jet fuel, urea, and gas turbine parts and accessories.
  • Consumption goods were down $166 million (14.5 percent), with falls across most commodities. Some of the more notable decreases included pest and plant sprays, wine, and pleasure boats.
  • Capital goods declined $164 million (20.0 percent). Again, there were falls across most commodities with goods transport vehicles, tractors, and earth moving machinery being leading contributors.
  • Petrol and avgas was the next largest decrease, down $33 million (27.8 percent).
  • Passenger motor cars were virtually unchanged, up $1 million (0.6 percent), the first rise following 12 months of falls compared with the same month previous year. Petrol cars exceeding 3000cc increased $24 million, while petrol cars with a 1000-3000cc rating were down $22 million. 
      

 Imports by Broad Economic Category - monthly values

In October 2009 compared with October 2008, import values declined across most of the top 40 commodity categories and most of the top 25 countries by country of origin.

By commodity:

  • Petroleum and products recorded the largest decrease, down $432 million (49.3 percent). This fall was led by crude oil and partly refined petroleum. The fall in crude oil was mainly due to lower prices, as mentioned above, while the fall in partly refined petroleum was mainly due to lower quantities, although prices were lower as well.
 

 Petroleum and Products Imports - Monthly values

  • Mechanical machinery and equipment was the next largest fall, down $178 million (30.7 percent). There were falls across most commodities, with gas turbine parts and accessories, harvesting machinery, and earth moving machinery being significant contributors. 
  • Iron and steel and articles, down $113 million (57.0 percent), and vehicles, parts, and accessories, down $106 million (24.6 percent), were the next largest decreases.
  • By comparison, increases in imports were fewer and smaller, the largest being aircraft and parts, up $33 million (31.8 percent), and ships, boats, and floating structures, up $22 million (126 percent). 

By country of origin:

  • Australia recorded the largest decrease in imports, down $249 million (27.9 percent), led by falls in crude oil, cereals, and iron and steel.
  • The next largest fall was for imports from Singapore, down $179 million (61.2 percent), mainly due to a fall in petroleum products such as automotive diesel, jet fuel, and partly refined petroleum.
  • Imports of crude oil tend to be irregular, especially by country of origin. In October 2009, Qatar was down $92 million (67.7 percent), and Brunei Darussalam was down $59 million (100 percent), while Russia was up $67 million from $1 million in October 2008. All these movements were mainly due to changes in crude oil imports.

Trade balance

In October 2009, the trade balance was a deficit of $487 million or 16.4 percent of the value of exports. This compares with an average October deficit of 30.0 percent of exports for the previous five years.

 Merchandise Trade Balance - monthly

The annual trade balance for the year ended October 2009 was a deficit of $1.2 billion (2.9 percent of exports). As a percentage of exports, this is approximately one-fifth of the average (of 16.2 percent) for the preceding five October years.  

Three months ended October 2009

Exports of merchandise goods for the three months ended October 2009 were valued at $8.5 billion, a fall of $2.0 billion (19.2 percent) from the same period of the previous year.

In the three months ended October 2009, key increases and decreases in exports compared with the three months ended October 2008 were as follows:

By commodity:

  • Milk powder, butter, and cheese recorded the largest decrease, down $530 million (26.5 percent), with declines across a wide range of commodities. The most significant declines came from whole milk powder (down $148 million), cheddar cheese (down $84 million), and anhydrous milk fat (down $68 million).
  • The second largest decrease was for crude oil, down $254 million (33.7 percent), which was driven by decreased prices as quantity was up 4.7 percent.
  • The next largest decrease was for meat and edible offal, down $177 million (18.8 percent), with sheep meat down $89 million and frozen bovine cuts down $74 million.
  • In comparison, the increases in exports for the latest three months were far fewer in number and much smaller. The largest offsetting increases were beverages, spirits, and vinegar, up $9 million (18.2 percent); preparations of vegetables, fruits, and nuts, up $8 million (13.6 percent); and precious metals, jewellery, and coins, up $7 million (3.9 percent).

By country of destination:

  • Exports to Australia showed the largest fall, down $502 million (17.6 percent), led by crude oil, down $317 million (45.8 percent).
  • The second largest fall was in exports to the United States of America, down $306 million (32.8 percent). Meat and edible offal declined $79 million (with bovine cuts and sheep meat both down); casein and caseinates declined $67 million; milk powder, butter, and cheese declined $38 million; and mechanical machinery and equipment declined $33 million.
  • The next largest fall was in exports to Japan, down $286 million (30.4 percent). Aluminium and aluminium articles declined $96 million (led by unwrought aluminium); milk powder, butter, and cheese, declined $58 million (led by cheese); and crude oil declined $46 million (with no exports of crude oil to Japan since July 2009).
  • Exports to China showed the largest increase, up $112 million (18.5 percent). Milk powder, butter, and cheese increased $78 million (led by whole milk powder); and logs, wood, and wood articles increased $62 million (led by pinus radiata logs).
  • Exports to Singapore were the next largest increase, up $58 million (31.9 percent), with petroleum and products up $88 million (led by crude oil).

Imports of merchandise goods for the three months ended October 2009 were valued at $10.3 billion, down 24.6 percent from the same period of the previous year.

In the three months ended October 2009, key increases and decreases in the value of imports compared with the three months ended October 2008 were as follows:

By commodity:

  • The petroleum and products category had the largest decrease, down $1.1 billion (43.5 percent), led by a decrease in crude oil, down $767 million, mainly due to lower prices. Crude oil import prices have fallen from a high level in 2008, peaking in August 2008. Jet fuel was the next largest decrease, down $75 million.
  • Vehicles, parts, and accessories decreased $429 million (33.7 percent) – the second largest decrease, led by goods transport vehicles, down $163 million; passenger motor vehicles, down $145 million; and tractors, down $49 million.
  • Mechanical machinery and equipment decreased $354 million (22.3 percent), spread across several commodities, with earth moving machinery, computers, and harvesting machinery being leading contributors.
  • Aircraft and parts recorded the largest increase, up $122 million (35.7 percent), due to an increase in aircraft parts.

By country of origin:

  • Imports from Australia showed the largest decrease, down $613 million (23.8 percent), with significant decreases in crude oil; iron and steel; cereals; and vehicles, parts, and accessories.
  • Imports from Japan were the next largest decrease, down $350 million (34.5 percent), including passenger motor vehicles (down $90 million), goods transport vehicles (down $46 million), mechanical and electrical machinery and equipment (each down $51 million), and automotive diesel (down $50 million).
  • Imports from Qatar were down $260 million (53.1 percent) led by falls in crude oil (down $187 million) and fertiliser (down $79 million).
  • The largest increase was from Russia, up $94 million from $2 million recorded in the three months ended October 2008. This was almost entirely due to imports of crude oil with no corresponding imports in the same period of the previous year.

Exchange rate movements

According to the Reserve Bank's Trade Weighted Index (TWI), the New Zealand dollar was 3.4 percent higher in October 2009 compared with September 2009, and 9.4 percent higher compared with October 2008. 

 Trade Weighted Index - Monthly

Updates to previous statistics

Provisional values published on 29 October 2009 have been updated. Merchandise trade statistics for the latest three months are provisional to allow for the inclusion of late data and amendments.

Updates to previous Overseas Merchandise Trade statistics  

For technical information contact:
Henry Minish or Sarah Urlich
Christchurch 03 964 8700
Email: overseastrade@stats.govt.nz 

Next release...

Overseas Merchandise Trade: November 2009 will be released on 7 January 2010.