Dairy commodity price rises drive increase in March exports

The value of total good exports rose strongly in March, driven by increases in dairy products, beef, and aluminium, Stats NZ said today.

These increases were mainly the result of higher prices.

In March 2022, total goods exports rose $978 million (17 percent) from March 2021 to reach $6.7 billion.

Exports of dairy products (milk powder, butter, and cheese commodity group) led the rise, up $461 million (30 percent) to $2.0 billion in March 2022.

This rise was led by milk powder, up $180 million on a year earlier. The rise was price-led, as quantities exported fell 9.3 percent. Rises in butter (up $111 million), cheese (up $71 million), and milk and cream (up $56 million) were also price-led.

Compared with March 2021, unit price changes for dairy products included:

• milk powder (up 33 percent)
• cheese (up 27 percent)
• butter (up 44 percent)
• milk and cream (up 33 percent).

"The recent high prices for exported dairy products have pushed values higher in almost all months of the 2021/22 export season to date, despite a fall in the overall quantity exported this season," international trade statistics manager Alasdair Allen said today.

Exports of milk powder, butter, and cheese in the 2021/22 season to date (August-March) were 18 percent higher in value, but 6.7 percent lower in quantity than in 2020/21.

The total value exported in the season to date is higher than in the strong dairy export season of 2013/14 when international prices were also high.

Other contributors to the rise in exports were beef (up $101 million), unwrought aluminium (up $57 million), and casein (up $31 million). These increases were all price-led; average unit price changes for these commodities compared with March 2021 were:

• beef (up 39 percent)
• unwrought aluminium (up 70 percent)
• casein (up 46 percent).

Of New Zealand's main export markets, the United States had the largest rise, up $225 million (39 percent) to $796 million. The rise was led by increases in lamb, mechanical machinery and equipment, and casein.

Imports continue to rise

In March 2022, the value of total goods imports rose $1.4 billion (25 percent) from March 2021 to reach $7.1 billion.

The rise was led by other chemical products (commodity group that includes diagnostic reagent test kits), up $243 million, and pharmaceutical products (including blood components, vaccines, and other immunological products), up $194 million.

Rises in these commodity groups follow similar rises in recent months .

Other commodity groups to rise included mechanical machinery and equipment (such as aircraft parts and laptops), up $154 million, automotive diesel, up $141 million) and crude oil, up $125 million.

Monthly trade deficit

The monthly trade balance in March 2022 was a deficit of $392 million.

In the 10 previous March months, there has only been one deficit (in 2018); the average surplus in the remaining nine months of that period was $503 million.

As a result of the monthly deficit in March 2022, the annual goods trade deficit has further widened to reach $9.1 billion for the March 2022 year.