Sea and air transport values rising

Spending on international sea and air transportation services has risen steadily from a low level in the June 2020 quarter, pushing up total transportation services imports by $100 million in the December 2020 quarter, Stats NZ said today.

Transportation services captures the expenditure associated with carrying objects and people into and out of New Zealand, other supporting services, as well as postal and courier services.

"New Zealand retailers are reporting much higher overseas freight costs than a year ago, after delays caused by the COVID-19 pandemic and a shortage of shipping containers," international trade manager Alasdair Allen said.

"This is supported by the figures for imports of transportation services in the December quarter.

"International transportation spending initially fell after COVID-19 hit in the March 2020 quarter, as New Zealand's total import volumes dropped, especially for things like fuel, and international air travel which all but stopped."

Spending on transportation by sea and air in the December 2020 quarter has started to bounce back up from unusually low levels in the June 2020 quarter. Sea transport includes freight and other sea transport, whereas air transport includes passenger (international airfares), freight and other air transport.

Transportation services imports rose $100 million (15 percent) in the December quarter, compared with the September 2020 quarter. Sea transport rose almost $70 million between the September and December quarters. Air transport was up about $24 million in the same period.

By contrast, the value of total merchandise goods imported in the December 2020 quarter was 8.5 percent higher than the September 2020 quarter.

However, overall transportation is down $531 million from the same quarter in 2019, in part reflecting a large fall in the number of international travellers since border restrictions were imposed in March 2020 and the value of goods imported dropped.

See Annual net migration down in 2020 for more detail on travel and migration numbers.

In merchandise trade, total goods imports for the year ended December 2020 were $7.4 billion less than in the December 2019 year .

Other import services categories to rise in the December 2020 quarter compared with the September 2020 quarter were telecommunication, computer and information services, and other business services. The main offsetting contribution was from insurance and pension services.

Travel imports (spending by New Zealanders travelling overseas) was New Zealand's top service import before COVID, but in the December 2020 quarter this was $1.3 billion lower than in the December 2019 quarter.

"While travel and transportation services trade has fallen since border restrictions were imposed in March 2020, our other top services have remained steady, now making up a larger proportion of the total," Mr Allen said.

Travel and transportation services combined contributed 27.6 percent of total services imports in the December 2020 quarter, compared with 48.6 percent in the December 2019 quarter. Other business services (includes things like management fees, legal and advertising services) made up over one-quarter of total services imports, now the top service import category.