New Zealand posted its biggest ever trade surplus for the month of February as Chinese demand for local primary products continued to soar.
The trade surplus was $818 million in February, from a revised $286 million surplus in January, and almost twice the $432 million surplus a year earlier, according to Statistics New Zealand. The annual trade balance was a surplus of $649 million, or 1.3 per cent of exports. Economists polled by Reuters were expecting a monthly surplus of $600 million and an annual surplus of $490 million.
Exports climbed 17 per cent to $4.56 billion, for an annual increase of 7.6 per cent to $49.43 billion. That was underpinned by China, with exports to the world's second-biggest economy up 49 per cent to $1.17 billion in February, for a 53 per cent annual gain to $10.93 billion, or 22 per cent of all exports. Imports from China rose 0.7 per cent to $647 million in February, and advanced an annual 6.3 per cent to $8.3 billion.
Sales into China were led by whole milk powder, pine logs and sheep meat, and the world's most populous nation bought about 44 per cent of the New Zealand's milk powder, butter and cheese exports.
"China has become an increasingly important destination for many of New Zealand's key commodity exports with strong demand supporting higher prices," Westpac Banking Corp senior economist Anne Boniface said in a note. "In turn, high international prices for New Zealand's key commodity exports have boosted incomes, particularly in the rural sector."
