Stats NZ

Higher dairy export prices boost terms of trade

Export prices increasing more than import prices in the June 2018 quarter led to a 0.6 percent rise in the terms of trade, Stats NZ said today.

Terms of trade measures the purchasing power of New Zealand’s exports abroad and is an indicator of the state of the overall economy.

The rise in export prices in the June 2018 quarter was led by a 3.2 percent increase for dairy products. Milk powder exports led the increase, with most other dairy products also increasing over the quarter. Seasonally adjusted dairy volumes rose 5.2 percent over the quarter.

Meat prices also contributed to the rise in export prices, up 3.6 percent to reach its highest ever level. This followed a fall of 2.5 percent in the March 2018 quarter. Seasonally adjusted meat volumes increased 4.7 percent over the quarter, and values were up 3.7 percent.

Import prices rose 1.7 percent in the latest quarter, led by a 10 percent increase for petroleum products. This rise was led by crude oil (up 14 percent). Crude oil prices are at their highest level since the December 2014 quarter. The volume of crude oil in the June 2018 quarter fell 35 percent, while the value fell 26 percent.

“The Marsden Point refinery maintenance shutdown during the June quarter led to the fall in volume of crude oil imported,” business prices manager Sarah Johnson said.

“The amount of diesel and petrol imported during the June quarter was up to cater for the shutdown.”

Created with Highcharts 5.0.14QuarterIndexBase: June 2002 quarter (=1000)Crude oil import prices and volumes, quarterly indexes, June 1997–2018VolumesPrices1998200020022004200620082010201220142016201801k2k3k4kStats NZ

Crude oil import prices and volumes, quarterly indexes, June 1997–2018

Created with Highcharts 5.0.14QuarterIndexCrude oil import prices and volumes, quarterly indexes, June 1997–2018VolumesPrices1998200020022004200620082010201220142016201801k2k3k4kStats NZ
QuarterVolumesPrices
1997-06-01874559
1997-09-01875551
1997-12-01698582
1998-03-011,021477
1998-06-01976465
1998-09-011,080493
1998-12-011,020472
1999-03-01987401
1999-06-01989528
1999-09-01961621
1999-12-01944813
2000-03-01886896
2000-06-011,105985
2000-09-011,1251,242
2000-12-011,0321,453
2001-03-011,1231,135
2001-06-017611,226
2001-09-011,0961,150
2001-12-017461,013
2002-03-011,153879
2002-06-011,0001,000
2002-09-011,1531,048
2002-12-019351,032
2003-03-011,0551,025
2003-06-01995904
2003-09-011,101865
2003-12-01874853
2004-03-01811866
2004-06-019871,050
2004-09-018981,114
2004-12-011,0121,165
2005-03-017991,053
2005-06-011,0281,348
2005-09-018951,523
2005-12-019041,542
2006-03-011,0881,692
2006-06-018401,949
2006-09-011,0222,007
2006-12-018991,615
2007-03-018461,620
2007-06-011,0021,627
2007-09-019741,818
2007-12-018722,017
2008-03-011,0772,172
2008-06-018602,560
2008-09-011,0243,086
2008-12-011,1852,181
2009-03-018551,391
2009-06-019601,400
2009-09-011,0971,734
2009-12-011,2271,657
2010-03-011,2801,811
2010-06-011,2941,870
2010-09-011,1711,745
2010-12-011,1951,826
2011-03-011,3062,220
2011-06-011,4152,284
2011-09-011,4282,266
2011-12-011,2462,326
2012-03-011,5652,350
2012-06-011,0432,553
2012-09-011,4412,195
2012-12-011,4142,274
2013-03-011,3282,254
2013-06-011,3212,160
2013-09-011,4692,229
2013-12-011,2632,278
2014-03-011,1282,173
2014-06-011,4152,067
2014-09-011,2882,148
2014-12-011,3651,847
2015-03-011,3231,318
2015-06-011,2401,363
2015-09-011,3801,491
2015-12-011,3171,079
2016-03-011,486781
2016-06-011,2401,047
2016-09-011,2731,167
2016-12-011,3191,151
2017-03-011,1991,307
2017-06-011,4211,257
2017-09-011,3871,152
2017-12-011,3511,408
2018-03-011,4461,549
2018-06-019461,760

The Reserve Bank trade weighted index fell 1.5 percent in the June 2018 quarter, with the New Zealand dollar weakening against most major currencies.

“A falling New Zealand dollar has an upward effect on export and import prices and their New Zealand-dollar values,” Mrs Johnson said.

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