Export prices show largest drop in over 50 years

Overseas Trade Indexes: March 2009 quarter (provisional)  –  Media Release

Export prices fell 8.2 percent in the March 2009 quarter, the largest quarterly fall since the December 1957 quarter, Statistics New Zealand said today. This was mainly driven by a fall in dairy product prices which were down 20.5 percent. The other main contributor to the fall in export prices was a 28.0 percent fall in petroleum and petroleum products due to lower export prices for crude oil.

Import prices fell 5.4 percent in the March 2009 quarter. The most significant contributor to the drop in import prices was petroleum and petroleum products (down 35.8 percent), largely driven by lower prices for crude oil. When petroleum and petroleum products are excluded, the total import price index shows a 2.8 percent rise in the March 2009 quarter, reflecting strong growth in machinery and transport equipment import prices.

Export and import prices fell in the March 2009 quarter, despite the depreciation of the New Zealand dollar by 7.1 percent as measured by the Trade Weighted Index.

The terms of trade fell 3.0 percent in the March 2009 quarter as merchandise export prices fell more than import prices. This is the largest fall in the terms of trade since the June 2002 quarter. The latest fall in the merchandise terms of trade means that in the March 2009 quarter, 3.0 percent less merchandise imports could be funded by a fixed quantity of merchandise exports than in the previous quarter.

Seasonally adjusted export volumes rose 2.0 percent in the March 2009 quarter – the first rise since the December 2007 quarter. Dairy products were the major contributor to the rise, led by increases in the volumes of skimmed and buttermilk powder and butter.

Seasonally adjusted import volumes fell 9.8 percent in the March 2009 quarter, and are at their lowest level since the December 2004 quarter. All commodity groupings fell this quarter apart from processed petroleum and petroleum products.

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Chris Pike
Wellington 04 931 4600
Email: info@stats.govt.nz