KEY POINTS:
New Zealand posted a smaller than expected $544 million trade deficit in September, with the country's trading performance benefiting from exports of crude oil.
Statistics New Zealand figures out today put the September year trade balance at $6.26 billion, from $6.18 billion in the September 2006 year.
September month imports totalled $3.55 billion, up 2.9 per cent from a year earlier, while exports were up 6.4 per cent to $3 billion. Both figures were a record for a September month.
The median figures from economists in a Reuters poll had been for a monthly deficit of $800m, an annual deficit of $6.5b, imports of $3.5b and exports of $2.7b.
SNZ said merchandise exports in September were boosted by a $131m increase in petroleum and products from a year earlier due to the second full month of production from the Tui field.
Also helping was an increase of $115m in the export of aircraft and parts.
Offsetting these increases was a $39m fall in meat and edible offal -- almost half from a decrease in frozen beef, followed by a $37m fall in exports of ships, boats and floating structures.
The largest contributor to the rise in imports was a $34m increase in mechanical machinery and equipment, particularly printing machinery, followed by a $29m rise in imports of vehicles, parts and accessories.
Imports of petroleum and products were down $65m, mainly due to low imports of fully refined petrol, SNZ said.
The $544m deficit for September was equivalent to 18.1 per cent of exports, with the $6.26b deficit for the year equating to 18 per cent of exports.
Seasonally adjusted, the value of merchandise exports increased 2.5 per cent to $8.7b in the September quarter, SNZ said.
That increase of $215m was more than accounted for by the seasonally adjusted $224m increase in petroleum and product exports for the quarter.
Offsetting that increase was an 18.5 per cent in the value of casein and caseinates, and a 2 per cent fall in milk powder, butter and cheese exports.
Casein and caseinates volumes dropped 25.7 per cent, while those of milk powder, butter and cheese were down 16.3 per cent.
Seasonally adjusted the value of imports fell 1.8 per cent in the September quarter, following a 1.5 per cent fall in the June quarter.
It was only the third time that total imports had recorded a fall in two consecutive quarters since June 1988, with the last having been in March 2003, SNZ said.
June quarter imports had been boosted by the arrival of HMNZS Canterbury.
Crude oil imports were up 12.6 per cent in the September quarter, following a 19.8 per cent increase in the June quarter.
The seasonally adjusted trade deficit for the September quarter was $1.3b, equivalent to 15.2 per cent of exports.
That compared to a deficit of $1.7b, or 20.3 per cent of exports for the previous quarter and an average quarterly deficit of $1.6b, or 17.9 per cent of exports during the past year.
ANZ-National Bank senior economist Khoon Goh said that in addition to oil revenues helping the figures top expectations, improved commodity prices, particularly for dairy, were starting to come through.
"The fact that consumption imports continue to hold up quite well is a worrying sign that perhaps domestic demand isn't waning as much as we initially thought."
Goldman Sachs JBWere economist Shamubeel Eaqub said a much-awaited recovery in the export sector was "very elusive", and predicted it would not materialise until the second half of next year.
- NZPA
