New Zealand had a record merchandise trade deficit of NZ$1.484 billion in August, Statistics New Zealand said on Wednesday – representing 37 percent of exports.
That missed forecasts for a shortfall of NZ$925 million following the revised deficit of NZ$196 million in July (originally -NZ$143 million).
The average monthly deficit in August over the last five years was NZ$1.0 billion.
“This month’s rise in imports to near record levels occurs at the time of year when exports are typically at a low point,” international statistics manager Tehseen Islam said.
Exports were up 9.9 percent on year in August to NZ$4.05 billion – missing forecasts for NZ$4.40 billion and down sharply from NZ$5.34 billion in the previous month.
The leading contributor to the rise was meat products and edible offal, up NZ$137 million (43 percent). This increase was led by sheep meat (up NZ$83 million or 55 percent) and beef (up NZ$45 million or 31 percent).
“New Zealand is exporting more beef and lamb, and getting better prices too,” Islam said.
Dairy products were up NZ$80 million (17 percent), led by an increase in butter and other milk fats, up NZ$63 million.
Imports jumped an annual 14.0 percent to NZ$5.54 billion versus expectations for NZ$5.50 billion – roughly unchanged from the previous month.
The leading contributor to the imports rise was petroleum and products, up NZ$186 million (50 percent) from last year. This increase was led by crude oil (up NZ$98 million) and diesel (up NZ$73 million).
Imports of crude oil and other petroleum products tend to fluctuate from month to month. The quantity of crude oil imported in August 2018 fell 13 percent from August 2017, but prices rose by about 60 percent.
The latest unit price for crude oil remains 31 percent lower than the most-recent series peak in May 2012.
Imports of vehicles, parts, and accessories also rose in August 2018, up NZ$55 million. Imports of buses, cars, and trucks all had similar contributions to this rise.
The annual trade deficit was NZ$4.8 billion in August 2018, up from NZ$3.1 billion in August 2017.