Australia’s international trade surplus might have risen back above $8 billion in May but that was a result of a sick economy as both exports and imports continued to fall sharply under the weight of the coronavirus pandemic suppressing demand here and offshore.
The slump in demand triggered by the COVID-19 pandemic drove the value of imports to a seven-year low in May, while weak demand and prices in global markets (except for iron ore and gold) saw exports slump to their lowest value in almost two years.
The Australian Bureau of Statistics said on Thursday the surplus totalled $8.025 billion up from a revised $7.8 billion in April, as imports fell sharply and exports fell to their lowest level since May 2018.
The ABS revised down the April surplus by $1 billion (and the total value of surpluses since November 2019 has been revised down by $1.6 billion because of more accurate data).
The surplus hit a record high of $10.4 billion in March of this driven by the side in imports which has continued. The value of imports in May was the lowest since June 2013.
Exports fell 4% or $1.6 billion to $35.74 billion as shipments of non-rural goods (iron ore, coal, copper etc) fell 4% or just over $1 billion, rural exports fell 10% or $404 million and shipments of non-monetary gold slid 12% or $219 million.
The ABS said exports of ores fell $199 million and coal shipments dropped more than $600 million in value (thanks to lower prices). grain exports dropped $184 million.
The ABS said the value of exports had dropped more than 15% or $6.4 billion from March ($42.15 billion) to $35.74 billion in May.
Imports dropped 6% to $27.7 billion as consumption goods fell 14% or $1.233 billion thanks to the shutdown of retailing and wholesaling activities. Imports of intermediate goods (for processing such as oil and chemicals) dropped 8% or $821 million while imports of capital goods dropped 7% or $412 million. Imports of non-monetary gold leap 113% of $710 million.
Imports fell more than 10% to $27.7 billion from $31.7 billion in March. The value of cars imported in May slumped by $829 million or 47% from April. the value of oil imports dropped $417 million or 22%.
Compared to December, 2019, total exports are down by 11.8% while imports have slumped by 22.6%.
