A fall in dairy export prices, coupled with a rise in petroleum import prices, was mostly responsible for a 2.6 per cent fall in New Zealand's terms of trade over the June quarter, Statistics NZ said.
A fall in the terms of trade means that less imports can be funded by the same quantity of exported goods. The terms of trade are 6.8 per cent lower than a year ago.
"The price of goods we export fell 1.0 per cent in the June quarter, reflecting a further drop in international prices for dairy products," prices manager Chris Pike said in a statement.
"At the same time, prices for imported goods rose 1.7 per cent, reflecting higher oil prices," he said.
While export prices were pushed down due to a 2.6 per cent fall in dairy product prices in the June 2012 quarter, the trend for dairy volumes remains at a high level.
Petroleum and petroleum products (up 8.4 per cent) were the largest contributor to a 1.7 per cent rise in import prices in the June 2012 quarter.
The seasonally adjusted volume of exports in the June 2012 quarter was down slightly.
The seasonally adjusted volume of imports was down 3.1 per cent due a fall in intermediate goods, such as crude oil.