NZ trade deficit narrows in November

New Zealand's monthly trade deficit narrowed in November as imports declined from earlier periods that were boosted by aircraft arrivals.

The country's trade deficit was $705 million in November, compared with a deficit of $815 million in October and $795 million in November last year, Statistics New Zealand said. The annual trade gap narrowed to $3.18 billion, from $3.27 billion in October and $3.7 billion a year earlier.

Imported goods fell 6.4% to $4.56 billion in November from the year-earlier month. Excluding imports of aircraft, imports edged down 0.1%.

New Zealand's goods exports in November dropped 5.4% to $3.86 billion, led by a 31% drop in the value of meat and edible offal exports. Beef exports fell 41% in value and 31% in volume as higher global supply dents prices. Lamb exports dropped 27% by value and 23% in volume as the demand for New Zealand lamb weakened following Britain's vote to exit the EU.

"Beef exports to the US, our top beef export destination, fell by around half when compared to November last year," said Statistics NZ senior manager Jason Attewell. "When compared to the same month of the previous year, the value of beef exports to the US have fallen in nearly every month since October 2015, only rising once in April 2016."

Lamb exports to the EU, New Zealand's top lamb export destination, fell in the month, with the UK seeing significant falls in value and quantity, he said.

Bucking the trend, dairy exports increased 2.6% as declining supply and improving demand bolster global prices for the country's largest export commodity. Wood exports rose 12% to $320 million and fruit exports lifted 27% to $74 million.

Meanwhile, capital goods led the fall in imports for the month, declining 26%. Imports of transport equipment sank 58%, due to a fall in aircraft and parts, which slid 98% or by $303 million. Machinery and plant equipment dropped 5.3%, or by $42 million.

The statistics agency noted that Wellington's CentrePort had been affected by the November 14 Kaikoura earthquake and is only partially operational. The value of exports through CentrePoint dropped 57% in November, compared with the year-earlier month. Exports through CentrePort accounted for 1.6% of the total value of the country's exports by sea, compared to an average 2.7% for the five previous November months, it said. Imports through CentrePort accounted for 4% of the total value of imports by sea, lagging its 5.3% average for the previous five November months.

On an annual basis, exports declined 1% to $48.46 billion in the year through November, while imports slid 1.9% to $51.63 billion.

(BusinessDesk)