Trade Surplus Widens Further On Strong Commodity Exports

The March trade surplus was higher than expected at $15.27bn, the highest since June 2022, up from an upwardly revised $14.15bn due to exports outpacing imports. The external side of the economy remains strong driven by commodities, which are not only supporting the economy as it slows but also boosting government revenues.

Australia trade balance on goods & services A$mn

Source: MNI - Market News/Refinitiv

• Exports rose 3.8% m/m and 16.5% y/y, driven by metal orders and minerals (+11.6%), after falling 2.7% m/m in February. Goods exports rose 4.3% while services were 0.9% higher. Coal shipments rose 1.9% while other mineral fuels fell 5.7%. Tourism exports rose 1.3%. after +1.6%.

Source: MNI - Market News/Refinitiv

• Iron ore export volumes rose about 20% m/m in March after falling around 15%. Prices were also higher up about 4%. Exports rose to China, Japan, Taiwan and Indonesia. Thermal coal export quantities rose 20.4% after falling 9.3% but prices were 13.3% lower following February’s 9.3% drop. Exports rose to China and Taiwan but fell to Japan.
• Imports rose 2.5% m/m and 6.3% y/y driven by non-industrial transport equipment, after slumping a downwardly revised 10.2% m/m in February. Goods imports rose 3.4% with consumer goods up a robust 14.1% after a 20% slump last month, intermediate goods stable and capital goods down 2.5%. Services imports fell 1.3% but are still up 20% y/y with tourism down another 3.3% after February’s -13.7%.
• Exports to China rose a robust 31.2% y/y boosted by commodity exports (see above) after 17.4% in February. Japan was up 8.9% y/y. They were also strong to Singapore, Taiwan and Indonesia but fell sharply to India and Korea and were weak to the US and NZ.