MNI ANALYSIS:Australia Trade Surplus Widens But Revisions Hurt

By Sophia Rodrigues

     SYDNEY (MNI) - Australia's trade balance recorded a surplus for five

straight months but a downward revision in past months' surplus meant that the

total surplus was less than indicated in the April data.

     The data still points to net export contribution to GDP in Q2 but not as

strong as indicated by the April numbers.

     Data published by the Australian Bureau of Statistics Wednesday show the

trade balance recorded a surplus of A$827 million in May which fell short of MNI

median forecast for a A$1.1 billion surplus. 

     Importantly, the outcome follows a significant downward revision in surplus

in March and April, which was mainly due to upward revision in imports.

     The revisions meant the total surplus in the first five months of this year

was A$4.88 billion which was, in fact, smaller than a total surplus of A$5.2

billion for first four months shown in the April data.

     In May, exports rose 4% m/m while imports grew 3%. The rise in exports was

mainly due to a 9% or A$325 million increase in other mineral fuels, a 4% or

A$322 million rise in metal ores and minerals, and a 6% or A$298 million gain in

coal and coke.

     Imports rose due to 6% or A$471 million increase in consumption goods, 4%

or A$459 million in intermediate goods and 23% or A$142 million rise in

non-monetary gold.

     In original terms, exports rose for three of the six key commodities,

though the size of the gains far exceeded the size of declines. Iron ore fines

export rose A$222 million, hard coking coal rose A$535 million and semi-soft

coal rose A$151 million.

     LNG exports fell for the first time in three months, down 4% or A$114

million as a 4% rise in values was offset by a 7% fall in quantities.

     Below is table on international trade data for May:

                                         May                            April

-----------------------------------------------------------------------------

                                     (in A$)                          (in A$)

                         Seasonally Adjusted              Seasonally Adjusted

Trade Balance                       +827 mln  +472 mln(revised from +977 mln)

MNI Median     +1.1 bln (Range +0.6 to +1.4)

Exports                            35.56 bln                        34.21 bln

Imports                            34. b74ln                        33.74 bln

--MNI Sydney Bureau; tel: +61 2-9716-5467; email: sophia.rodrigues@marketnews.com

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