Rising dairy sales boost trade surplus

June car imports were up 31 per cent compared with June last year.

New Zealand reported a higher-than-expected monthly trade surplus of $242 million in June as exports were boosted by dairy sales, especially to China.

The annual deficit in the year to June was $3.7 billion versus $3.8b in the 12 months to May. Economists had expected a monthly surplus of $100m and an annual deficit of $3.7b, according to the median in a Bloomberg poll. The June surplus was the fourth monthly surplus in a row.

Exports rose 11 per cent on the year to $4.7b. Milk powder, butter, and cheese led the rise, up 45 per cent to $1.2b and on an 11 per cent increase in volume.

The rise in dairy exports marked the ninth consecutive month-on-month increase as global dairy prices have continued to improve. Dairy exports to China jumped 102 per cent in value and 63 per cent in quantity to reach $373m for the month, compared to June 2016.

"The milk powder, butter, and cheese group ... accounts for over a quarter of our total exports," said Daria Kwon, international statistics senior manager at Statistics NZ.

Exports of meat and edible offal, the country's second-largest commodity export, rose 4.9 per cent to $616m. This is the sixth consecutive month of rises for meat. Lamb led the increase, up $19m in value or 8.9 per cent.

The exports of logs, wood and wood articles, the third-largest group, rose 7.1 per cent to $388m. Fruit exports, meanwhile, slipped 11.8 per cent to $419m. The fall was mainly driven by kiwifruit, Stats NZ said.

Overall exports to China were up 25.6 per cent for the month of June against June last year to $1b while exports to Australia rose 0.9 per cent to $672m.

Imports from all sources rose 7.7 per cent to $4.5b in June versus the same month a year ago. Car imports led the rise, up 31 per cent to $505m. New cars led this increase, up $86m in value.

Imports from China rose 5.8 per cent to $860m in June versus the same month a year ago while imports from Australia fell 0.3 per cent to $533m. The biggest increase came from imports from Japan, up 35.2 per cent on the year to $376m.

The numbers
$242m trade surplus
$4.7b exports, up 11%
$4.5b imports, up 7.7%