NZ trade deficit little changed in December

Fonterra milk tankers at their specialty powder and casein manufacturing plant at Longburn, near Palmerston North. Photo / Mark Mitchell

New Zealand's monthly trade deficit was little changed in December from the year-earlier month as imports and exports both slid by about the same amount.

The country had a $41 million trade deficit in December 2016, compared with a $42m deficit in December 2015, Statistics New Zealand said. The deficit is less than the $98m anticipated by economists, according to a consensus forecast. The value of New Zealand's exports in December shrank by $41m, or 0.9 per cent, to $4.38b, while imports reduced by $42m, or 0.9 per cent, to $4.42b.

The decline in exports was led by a $93m fall in the value of meat and edible offal exports, the country's second-largest export commodity group. Beef exports slid by $47m, or 17 per cent, while the quantity reduced by 12 per cent. Lamb exports also dropped $47m, or 17 per cent, with the quantity down 18 per cent.

Bucking the trend, exports of milk powder, butter and cheese, the largest commodity export group, advanced $109m, or 8 per cent, to $1.47b. Milk powder exports rose $60m, or 7 per cent, to $857m even as the quantity exported declined 4.7 per cent.

Wood exports, the third-largest commodity group, were little changed in the month, down 1 per cent to $347m, while exports of fruit, the fourth-largest group, jumped 51 per cent to $49m.

Meanwhile, the slide in imports was led by a 2.5 per cent fall in the value of intermediate goods. Imports of processed industrial supplies such as palm oil cake, plastics and fertilisers declined by $75m, or 8.6 per cent, offset by a $58m lift in the value of processed fuels such as automotive diesel and jet fuel.

The statistics agency noted that Wellington's CentrePort had been affected by the November 14 Kaikoura earthquake and is only partially operational. The value of exports through CentrePoint dropped 90 per cent in December, compared with the year-earlier month. Exports through CentrePort accounted for 0.4 per cent of the total value of the country's exports by sea, compared to an average 2.7 per cent for the five previous December months, it said. The value of imports through CentrePort was down 40 per cent from the same month in 2015 and it accounted for 3 per cent of the total value of imports by sea, lagging its 6.1 per cent average for the previous five December months.

On an annual basis, exports declined 1.1 per cent to $48.4b in the 2016 year, compared with 2015, while imports slid 1.7 per cent to $51.6b. The annual trade deficit was $3.2b or 6.6 per cent of exports.