Friday, March 29, 2024

Widening NZ trade deficit in September

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New Zealand’s monthly trade deficit widened to a record level in September as meat exports dropped to their lowest level in more than three years.
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The country’s trade deficit expanded to $1.44 billion in September from $1.14b a year earlier, Statistics NZ said.

Exports fell 5.7% to $3.47b, led by a 35% decline in meat and edible offal exports to $281 million, the lowest monthly reading since August 2013.

That pushed meat exports down to third place in the monthly rankings behind wood, although it remains in second place on an annual basis.

Imports advanced 1.8% to $4.9b, boosted by the importation of aircraft in the month.

Excluding aircraft imports from the total, imports fell 0.8% to $4.7b, the statistics agency said.

The meat export market is retreating from highs reached last year when beef exports hit a record as a shortage in the United States pushed up prices.

In the latest monthly data for September, the value of beef exports fell 35% from a year earlier amid increased beef supply in the US, while lamb exports sank 39% amid subdued demand in the United Kingdom.

A higher NZ dollar is also weighing on exports, making local goods more expensive in international markets, analysts said.

Exports of milk powder, butter and cheese slid 1.2% to $616m, while the quantity rose 16%, Statistics NZ said.

Milk powder fell 1.9% in value while the quantity rose 19%, reflecting price declines.

Milk fats, including butter slipped 3.4% in value and 4.7% in quantity while cheese gained 21% in value and 77% in quantity.

Fruit, the fourth largest commodity export increased 44% to $228m while the quantity advanced 56%.

Kiwifruit led the rise, with the value up 46% and the volume up 58%.

Wood exports advanced 17% to $347m while the quantity increased 19%, the agency said.

On an annual basis the country's trade deficit was $3.4b, compared with an annual deficit of $3.17b in September last year.

Annual exports totalled $48.58b in the year through to September, while imports totalled $51.99b, according to the data.

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