Prices of forest product exports gained 4.2 per cent, led by a 4.4 per cent gain for wood prices, while fruit and vegetable prices dropped 11 per cent, reflecting lower prices for kiwifruit.
Petroleum product import prices fell 3 per cent in the latest three months to reach similar levels to 2011, led by a 4.2 per cent decline for crude oil. Transport equipment prices fell 2.2 per cent to a five-year low, driven by new and used cars.
The services terms of trade fell 1 per cent in the second quarter as a 0.1 per cent gain in services exports was outpaced by a 1.2 per cent gain in services imports. Transportation export services, such as New Zealand air and sea transport used by foreigners, rose 1.6 per cent and was offset by a 0.5 per cent decline in travel services, such as holiday packages and meals.
Services imports were driven higher by a 1.2 per cent gain in 'other' services such as engineering, a 1.4 per cent gain in travel, such as overseas accommodation, and a 0.9 per cent increase in transportation, led by sea freight.
The trade-weighted index rose 0.7 per cent in the second quarter.
Christina Leung, an ASB economist, said higher dairy export prices largely reflected the effects of the summer drought, as supply concerns drove a surge in prices over March and April.
"Although improved weather conditions have seen an easing in supply concerns and in turn global dairy prices more recently, prices remain very high," she said.
"Meanwhile, the effects of the recent Fonterra contamination scare on global dairy demand and prices appear limited."
Leung said the medium-term outlook for export growth was mildly positive as global demand continues to grow.
"In particular, China's expanding middle class is likely to underpin increased demand for our meat and dairy exports. Meanwhile, stronger domestic demand is likely to drive a continued recovery in imports."
