New Zealand's goods exports soar, trade deficit narrows to just $2.1 billion

Data from Stats NZ shows that New Zealand's goods exports in September reached $5 billion, imports fell 0.9%, and the trade deficit narrowed to $2.1 billion.

New Zealand's merchandise exports grew strongly in September, while imports fell slightly, according to the latest trade data from Stats New Zealand. Notably, the import of a Boeing 777 and related aircraft engines highlighted the country's volatile trade picture. Exports rose 5.2% year-on-year, while imports fell 0.9%. "The export growth was impressive, particularly in fruit, but may not be sustainable as the harvest season draws to a close," said Shannon Nicoll, associate economist at Moody's Analytics.

New Zealand exports were $5 billion in September, while imports fell 0.9 percent, data from Stats New Zealand showed. The trade deficit narrowed to $2.1 billion.

Fruit exports more than doubled in September, boosting New Zealand’s total exports by $246 million to $5 billion. This was the country’s second-highest September export figure on record. However, the trade deficit narrowed to $2.1 billion from $2.4 billion.

A boom in fruit exports contributed to the growth, with kiwifruit exports up 117% to $212 million, while apple exports were up 23% to $7.3 million. Milk powder, butter and cheese also saw a $147 million increase, highlighting the important role that agriculture plays in New Zealand’s export economy.

In addition, exports of logs, wood and machinery also recorded increases, indicating that international demand for these products remains strong. However, commodities such as crude oil, aluminum and vegetable fats... recorded decreases compared to the same period last year.

Exports to some major markets such as Japan, Australia and China fell slightly, raising concerns about purchasing power from key trading partners. Meanwhile, exports to the US increased by US$11 million and to the European Union by US$183 million, marking steady growth in these markets.

Moody's Analytics associate economist Shannon Nicoll predicts that the easing of monetary policy, with a reduction in the official cash rate (OCR), will stimulate domestic demand for international goods and business demand for intermediate goods. This could help New Zealand consumers feel more willing to spend in the near term.

On the import side, New Zealand recorded a $67 million, or 0.9%, decline to $7.1 billion. The decline reflects a downward trend in recent months, as New Zealand consumers have been more cautious about spending on big-ticket items, particularly cars and electric vehicles.

However, economists remain optimistic that, as international demand strengthens, New Zealand's exports will have a chance to recover and continue to make a positive contribution to the economy.

Despite a strong September export performance and a modest fall in imports, New Zealand’s trade picture remains challenging. Uncertainty in key markets such as China and Australia is likely to continue to weigh on exports, while imports remain weighed down by cautious domestic consumption. However, changes in monetary policy could brighten the outlook for the country’s economy in the coming months.

https://www.nzherald.co.nz/business/exports-up-imports-down-as-fruit-trade-with-europe-booms/BYV3G5AOFFHKFJGWQPSGF4NSKA/

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