WELLINGTON: New Zealand’s terms of trade fell in the third quarter, reflecting a decline in the value, price and volume of exports. Dairy, meat and forestry shipments led the drop.
The terms of trade, a measure of the purchasing power of New Zealand’s exports, fell 1.8% in the third quarter from the second quarter, Statistics NZ said. Disruptions caused by earthquake damage to the government statistician’s Wellington building meant it wasn’t able to provide seasonally adjusted figures as it usually does. In actual terms, export prices for goods fell 2.8%, while volumes declined 16% and the value of exports dropped 18% to $10.3 billion. Import prices fell 1%, volumes rose 14% and the value increased 13% to $13.2 million.
Statistics NZ said the decline in export prices was led by dairy, down 3.7%, a 3.1% drop for meat and a 4.1% fall for forestry. Meat and dairy led the decline in both values and volumes. Export prices in the third quarter were down 10% from the same period of 2015. The decline in import prices was spread over a range of categories, which was offset by gains for petroleum.
Among New Zealand’s biggest trading partners, the terms of trade with China fell 0.5% as export prices fell more than imports, while the volume of exports fell 19% while import volumes rose 19%. The numbers are unadjusted and likely to be affected by the seasonal nature of much of New Zealand’s exports. The terms of trade with Australia rose 0.4% and to the US it declined 1.4%.
