Demand for imports has widened the trade deficit to $4 billion. Photo/123RF.
Demand for imports has widened the trade deficit to $4 billion. Photo/123RF.
Rising demand for imported goods has pushed New Zealand's trade balance to its widest deficit for a June year in a decade, Statistics New Zealand said.
The country's annual trade deficit widened to $4 billion in the June year, from a deficit of $3.66 billion a year earlier, Stats NZsaid. Annual imports increased by $6.02 billion to $59.55 billion, while exports rose by $5.65 billion to $55.52 billion.
"The last June year surplus was in 2014, driven by high dairy export values," acting international statistics manager Dave Adair said. "Exports dipped in 2015 leading to a deficit, which has widened since due to steadily rising imports."
The latest rise in annual imports was led by $24 billion of intermediate goods, up $3 billion from the year earlier, the statistics agency said. Petroleum and products, excluding petrol, led the intermediate goods rise, up by $850 million. This was followed by parts of transport equipment, up $416 million, and parts of plant and machinery, up $413 million.
The gain in annual exports was mostly due to an increase in dairy products, the country's largest export commodity group, which rose by $1.65 billion to $14.16 billion. That was followed by a $1.01 billion gain in the value of meat and edible offal exports to $7.05 billion, and a $740 million increase in the value of forestry product exports to $4.96 billion.
For the June month, New Zealand imports jumped to $5.02 billion from $4.45 billion in June last year, and marking the highest ever level for a June month. The increase was led by petroleum and products, which gained $257 million as fuel imports rose by $300 million while crude oil fell by $35 million, Stats NZ said.
The value of exports in June rose $217 million to $4.91 billion, led by a $58 million increase in the value of meat and edible offal exports as lamb exports to China rose $26 million. Kiwifruit and preparations of milk, cereals, flour, and starch also contributed to the exports rise.
The export gains were partly offset by an $84 million decline in the value of milk powder, butter, and cheese exports in the month to $1.12 billion. Milk powder exports fell by $162 million, or 25 percent, as the quantity dropped 32 percent due to falls across a range of key markets, including large falls to Algeria and China. However, milk fat exports including products like butter were up $93 million.
The monthly trade balance was a deficit of $113 million, compared with a surplus of $243 million in June last year and only the second deficit for a June month in the last decade.
