The Australian Bureau of Statistics (ABS) has just released trade data for the month of March, with Australia recording a surprise seasonally-adjusted trade surplus of $307 million. Analysts had expected the trade balance to come in flat.
It was the first monthly surplus in 15 months (see below chart).
In seasonally adjusted terms, exports rose rose $148m (1%) to $25,746m. The increase in exports was assisted by a $270m (1%) fall in imports to $25,493m, mostly on the back of lower capital goods (-$574m).
Australia’s two major export commodities – iron ore (26% share) and coal (13% share) – rose by $834 million and $37 million respectively. Gas exports (6% share) also rose (+$258 million), whereas Australia’s fourth biggest export – gold (5% share) – fell by -$135 million over the month (see below chart).
Exports to China rose by $1,049 million over the month to a record $7,402 million, with its share of total exports also hitting a record high of 34%. Exports to the three other major markets – Japan (+$451 million), Korea ($283 million) and India (+$9 million) – also rose (see below chart).
Western Australia continues to dominate the nation’s exports. It alone accounted for 50% of Australia’s merchandise exports in March, with exports rising by 17% over the month. Exports from Queensland also rose by 9%, after crashing in January (see below chart).
Western Australia also continues to be the only state with a meaningful trade surplus, although South Australia is also pulling its weight:
Finally, Australia’s services trade balance improved in March (+$48 million), and continues to recover after a horror run since late-2008 on account of the high Australian dollar (see below charts).
Overall, the turnaround in the trade balance augers well for the upcoming March quarter GDP results, with net exports expected to show a positive contribution.