NZ trade deficit blows out after big jet import; exports down 11% (Update 2)

One-off imports of Jetstar aircraft worth NZ$571 million tipped New Zealand's trade balance to a deficit of NZ$417 million for the June month. (Update 2 includes ASB comment.) Without the aircraft imports, New Zealand would have had a trade surplus of NZ$154 million for the month, which was below economist expectations of a surplus over NZ$200 million. ASB economist Jane Turner said the NZ$154 million surplus figure was the more relevant for showing New Zealand's underlying trade trend, if not also current account implications. "While the physical importation of aircraft has appeared in the trade data, they may not show up in the balance of payment and GDP statistics," Turner said. "If the planes are treated by Statistics NZ as owned or financially leased by Jetstar NZ they would be included in those statistics. However, the planes remain registered in Australia and could be treated statistically as on an operating lease and hence not "˜owned' locally," she said. New Zealand merchandise exports in June earned NZ$3.2 billion, down 11% from June 2008. This was the biggest year-on-year drop in exports for any month since July 2007, when exports fell 12.6% from the year before, Statistics New Zealand (Stats NZ) said. "Exports in June 2008 were lifted by various factors, including high production from the Tui oilfield, high international oil prices and higher dairy prices," Acting Government Statistician Cathryn Ashley-Jones Geoff Bascand said. Crude oil exports were down 60% from a year ago, due to both decreases in quantity exported and value, while milk powder, butter and cheese exports fell 11%, mainly due to decreased prices, Ashley-Jones Bascand said. "The export trend has decreased 4.5 percent since October 2008, with an average decline of 0.6 percent per month," she he said. Merchandise imports were valued at NZ$3.6 billion in June 2009, down 5.1% from June 2008. "(T)he June month includes the one-off import of several large aircraft valued at $571 million. Excluding this one-off, merchandise imports would have been $3.0 billion, a decrease of 20.0 percent on June 2008," Ashley-Jones Bascand said. "The trend for merchandise imports has been decreasing since August 2008, and is down 20.2 percent since then," she he said. Imports of petroleum and products fell 59.2% from June a year ago, while imports of vehicles, parts and accessories were down 43.6%. In the June 2009 year, New Zealand's merchandise trade balance was a deficit of NZ$3.2 billion, or 7.4% of exports. This compared with an average deficit of 10.5% of exports over the last 10 June years, Ashley-Jones said. Merchandise exports for the June 2009 year were NZ$43 billion, up 7.5% from the year ended June 2008. This compared to exports of NZ$46.2 billion, up 3.8% from the previous year.