Merchandise
Terms of trade
The merchandise terms of trade fell 1.3 percent in the September 2009 quarter, due to export prices (down 5.2 percent) decreasing more than import prices (down 3.9 percent). The terms of trade index is at its lowest level since the December 2005 quarter. The latest quarterly fall followed decreases of 9.4 percent in the June 2009 quarter and 2.7 percent in the March 2009 quarter. In the year to the September 2009 quarter, the merchandise terms of trade index fell 13.8 percent, compared with increases of 5.8 percent and 8.4 percent in the years to the September 2008 and 2007 quarters, respectively.
The latest quarterly fall in the merchandise terms of trade means that in the September 2009 quarter, 1.3 percent less merchandise imports could be funded by a fixed quantity of merchandise exports than in the June 2009 quarter.
Export prices
The merchandise export price index fell 5.2 percent in the September 2009 quarter, and is now at its lowest level since the June 2007 quarter. This was the third consecutive quarterly fall, following decreases of 11.9 percent and 7.9 percent in the June 2009 quarter and the March 2009 quarter, respectively. All of the export price indexes included in the tables attached to this release fell in the latest quarter, except for aluminium. The appreciation of the New Zealand dollar had a downward influence on total export prices in the latest quarter. The Reserve Bank Trade Weighted Index (TWI) increased 7.2 percent in the September 2009 quarter.
The food and beverages index (down 7.2 percent) made the most significant contribution to the overall fall in the export price index in the September 2009 quarter, compared with falls of 14.8 percent in the June 2009 quarter and 8.1 percent in the March 2009 quarter. Dairy products (down 10.4 percent) and meat (down 3.2 percent) were the major drivers to the latest quarterly fall in the index. In the year to the September 2009 quarter, the food and beverages index fell 22.6 percent, compared with a 30.0 percent rise in the year to the September 2008 quarter. The latest annual fall was the largest since the series began in the September 1971 quarter.
The dairy products index fell 10.4 percent in the September 2009 quarter, following falls of 24.1 percent in the June 2009 quarter and 19.9 percent in the March 2009 quarter. Price decreases for milk powder (down 10.7 percent), cheese (down 12.3 percent), and butter (down 6.0 percent) were the main contributors to the latest quarterly fall in the dairy products index. In the year to the September 2009 quarter, the dairy products index fell 42.5 percent, compared with a 44.7 percent rise in the year to the September 2008 quarter. The latest annual fall was the largest since the series began in the March 1950 quarter.
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The non-food manufactured goods index (down 5.5 percent) also made a significant contribution to the decrease in the total export price index. The latest fall followed decreases of 9.4 percent in the June 2009 quarter and 4.9 percent in the March 2009 quarter. Price falls for casein (down 22.9 percent), and iron and steel (down 7.1 percent) contributed to this decrease. An increase in prices for aluminium (up 6.9 percent) partly offset these decreases. In the year to the September 2009 quarter, the non-food manufactured goods index fell 16.5 percent, compared with an increase of 14.1 percent in the year to the September 2008 quarter.
The petroleum and petroleum products index rose 27.8 percent in the September 2009 quarter, following three consecutive quarterly falls. The latest quarterly rise followed falls of 1.9 percent and 28.0 percent in the June 2009 and March 2009 quarters, respectively. The rise in the latest quarter was driven by higher export prices for crude oil. In the year to the September 2009 quarter, the petroleum and petroleum products index fell 38.2 percent, compared with a 65.9 percent rise in the year to the September 2008 quarter.
In the year to the September 2009 quarter, the merchandise export price index fell 21.2 percent, which was the largest since a 23.1 percent decrease in the year to the June 1958 quarter. The latest annual fall followed a rise of 25.0 percent in the year to the September 2008 quarter and a 1.9 percent fall in the year to the September 2007 quarter.
Import prices
The merchandise import price index fell 3.9 percent in the September 2009 quarter, and now is at its lowest level since the June 2008 quarter. The latest quarterly fall was the third consecutive fall, following decreases of 2.8 percent in the June 2009 quarter and 5.4 percent in the March 2009 quarter. The appreciation of the New Zealand dollar against our major trading partners’ currencies made a significant contribution to the fall in import prices. According to exchange rates provided by the New Zealand Customs Service for valuing imports, the trade weighted index of the New Zealand dollar rose 8.7 percent in the September 2009 quarter. All of the commodity-based index series included in the tables attached to this release fell this quarter, with the exception of petroleum and petroleum products.
The major contributions to the overall fall in import prices in the September 2009 quarter came from the mechanical machinery index, the non-fuel crude materials index, and the chemicals and related products index.
In the September 2009 quarter, the mechanical machinery index fell 11.3 percent, following a fall of 5.1 percent in the June 2009 quarter and a rise of 8.2 percent in the March 2009 quarter. The latest quarterly fall was the largest since an 11.5 percent decrease in the March 2003 quarter. Price falls for portable computers and computer peripheral equipment contributed to this quarter’s fall. (Computer-related producer price indexes from the United States are used as a proxy to measure price change for imported computers. The United States indexes are exchange rate adjusted, and the appreciation of the New Zealand dollar against the United States dollar in the latest quarter had an impact on the decrease in computer prices.) Despite the latest quarterly fall, the mechanical machinery index rose 7.6 percent in the year to the September 2009 quarter. This compared with decreases of 1.7 percent and 17.1 percent in the years to the September 2008 and 2007 quarters, respectively.
The non-fuel crude materials index fell 26.9 percent in the September 2009 quarter, compared with an increase of 21.9 percent in the June 2009 quarter and a decrease of 39.1 percent in the March 2009 quarter. Significant price decreases for calcium phosphates were the main driver of the fall in this index. Other price falls were recorded for synthetic staple fibres and vegetable oils. In the year to the September 2009 quarter, the non-fuel crude materials index fell 37.9 percent – the largest annual fall since the series began in the September 1971 quarter. The latest annual fall compared with an 83.0 percent increase in the year to the September 2008 quarter, and a 5.9 percent decrease in the year to the September 2007 quarter.
The chemicals and related products index showed a fall of 5.2 percent in the September 2009 quarter, following decreases of 7.9 percent in the June 2009 quarter and 3.6 percent in the March 2009 quarter. The latest quarterly fall was mainly driven by price decreases for inputs for fertilisers, and for plastic plates of polymers of ethylene (such as plastic food wrap). The chemicals and related products index also recorded an annual fall in the year to the September 2009 quarter, down 11.5 percent. This annual fall, which was the largest since the March 1990 quarter, compared with a rise of 19.4 percent in the year to the September 2008 quarter and a fall of 7.1 percent in the year to the September 2007 quarter.
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The petroleum and petroleum products index rose 16.9 percent in the September 2009 quarter following three consecutive quarterly falls, and contributed the main offsetting effect to the overall fall in import prices. The latest quarterly increase compared with falls of 1.0 percent in the June 2009 quarter and 35.6 percent in the March 2009 quarter. The rise in the latest quarter was primarily influenced by higher crude oil prices (up 23.9 percent), and increases for motor spirit and automotive diesel. The petroleum and petroleum products index fell 42.0 percent in the year to the September 2009 quarter. This was the largest annual fall since the September 1986 quarter, and compared with an increase of 66.1 percent in the year to the September 2008 quarter and a decrease of 11.5 percent in the year to the September 2007 quarter.
Excluding petroleum and petroleum products, import prices fell 7.3 percent in the September 2009 quarter.
In the year to the September 2009 quarter, the total imports price index fell 8.6 percent, compared with an 18.2 percent rise in the year to the September 2008 quarter and a 9.5 percent fall in the year to the September 2007 quarter.
Imports by broad economic category
All three broad economic categories recorded price falls in the September 2009 quarter. A 6.4 percent fall in the consumption goods index was the major contributor to the 3.9 percent fall in the total import price index. Falls of 7.1 percent in the capital goods index and 2.7 percent in the intermediate goods index also made significant contributions to the overall fall.
The consumption goods index fell 6.4 percent in the September 2009 quarter – the largest quarterly fall since the series began in the September 1989 quarter. This fall followed a fall of 4.1 percent in the June 2009 quarter and a rise of 7.9 percent in the March 2009 quarter. The latest quarterly fall in this index was mainly influenced by the semi-durable goods sub-index (down 9.0 percent), which was primarily due to price falls for clothing and footwear items, and the non-durable goods sub-index (down 5.7 percent).
The capital goods index also fell (down 7.1 percent) in the September 2009 quarter, and was the largest quarterly fall since the March 2003 quarter. This quarter's fall followed a 5.2 percent decrease in the June 2009 quarter and an 8.8 percent increase in the March 2009 quarter. The fall in the latest quarter largely came from a 7.2 percent fall in the non-transport equipment sub-index, including price falls for tractors, computers, and computer accessories (such as storage devices).
In the September 2009 quarter, the 2.7 percent fall in the intermediate goods index followed three consecutive quarterly falls. Six out of eight published sub-indexes recorded decreases. The latest quarter’s fall primarily came from a 6.9 percent fall in the processed industrial supplies sub-index, mainly driven by price decreases for inputs for fertilisers, and for plastic plates of polymers of ethylene (such as plastic food wrap). The primary fuels and lubricants sub-index (up 23.4 percent, due to higher crude oil prices) provided a partly offsetting rise.
Services
Terms of trade
The terms of trade for services rose 9.8 percent in the September 2009 quarter, which was the largest quarterly increase since the series began in the June 1997 quarter. The current quarter’s rise followed a 3.8 percent increase in the June 2009 quarter and a 2.3 percent decrease in the March 2009 quarter. The latest quarterly rise was due to services export prices (down 1.5 percent) falling less than services import prices (down 10.3 percent). In the year to the September 2009 quarter, the terms of trade for services rose 4.2 percent, compared with a decrease of 3.6 percent in the year to the September 2008 quarter and an increase of 10.8 percent in the year to the September 2007 quarter.
Export prices
Services export prices fell 1.5 percent in the September 2009 quarter, following a fall of 3.3 percent and a rise of 0.5 percent in the June 2009 quarter and March 2009 quarter, respectively. The transportation index (down 6.0 percent) made the largest contribution to the overall fall in services export prices in the latest quarter.
In the year to the September 2009 quarter, the services export price index fell 1.3 percent, following a 7.2 percent rise in the year to the September 2008 quarter. The latest annual fall was the first since a 0.8 percent decrease in the year to the March 2004 quarter.
Import prices
Services import prices fell 10.3 percent in the September 2009 quarter, following a fall of 6.9 percent in the June 2009 quarter and a rise of 2.9 percent in the March 2009 quarter. The latest quarterly decrease was the largest since the series began in the June 1997 quarter. The main contribution to the overall fall in services import prices was from the transportation index (down 19.7 percent), mainly driven by the sea freight sub-index.
In the year to the September 2009 quarter, the services import price index fell 5.3 percent, compared with a rise of 11.3 percent in the year to the September 2008 quarter and a fall of 8.2 percent in the year to the September 2007 quarter.
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Exchange rate movements
According to the exchange rates published by the Reserve Bank of New Zealand, the trade weighted index (TWI) of the New Zealand dollar rose 7.2 percent in the September 2009 quarter. In this quarter, the New Zealand dollar appreciated against our five major trading partners’ currencies. The greatest appreciation was against the United States dollar (up 11.9 percent), followed by a 7.5 percent appreciation against the Japanese yen.
Exchange rates used in the calculation of merchandise import values differ from the weekly exchange rates used in the calculation of merchandise export values. Import values are converted from foreign currencies using exchange rates set by the New Zealand Customs Service (NZCS) every two weeks. These exchange rates are prepared 11 days before the effective date and are then applied for two weeks. Therefore, the NZCS rates of exchange lag from 11 to 25 days compared with exchange rates published by the Reserve Bank.
For the September 2009 quarter, the NZCS TWI recorded an 8.7 percent rise, with the New Zealand dollar rising against our five major trading partners’ currencies. The appreciation of the New Zealand dollar has a downward influence on both import and export prices in New Zealand dollars. The impact on the terms of trade depends on the relative exchange effect on exports and imports.
Exchange Rates
New Zealand Customs Service |
| |
USA
(NZ$:US$) |
UK
(NZ$:pound) |
Australia
(NZ$:A$) |
Japan
(NZ$:yen) |
EU
(NZ$:euro) |
| Change from June 2009 quarter (%) |
13.4 |
3.8 |
1.7 |
10.3 |
7.9 |
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Updates to previously published material
The overseas merchandise trade indexes are provisional for one quarter to allow for receipt and editing of late and amended trade documentation.
June 2009 Quarter Overseas Trade Indexes (Prices)
Merchandise |
| |
Export price index |
Import price index |
Terms of trade index |
| Series ref: OTPQ |
SEO1E95 |
SIO1I95 |
STTZZ5 |
| Published on 10 September 2009 |
| Provisional June 09 |
1033 |
957 |
1079 |
| Published on 10 December 2009 |
| Final June 09 |
1029 |
958 |
1074 |
For the June 2009 quarter, the final merchandise export price index number was 4 index points lower than the provisional index number. This was mainly due to the inclusion of more up-to-date merchandise trade source data for the forestry products index.
For technical information contact:
Stephanie Ye or Dylan Xu
Wellington 04 931 4600
Email: info@stats.govt.nz
Next release ...
Overseas Trade Indexes (Prices): December 2009 quarter (provisional)
and
Overseas Trade Indexes (Volumes): December 2009 quarter (provisional)
will both be released on 10 March 2010.