New Zealand goods trade in deficit amid currency value concerns

Falling meat and dairy exports put New Zealand's goods trade into deficit last month, the government statistics agency said Wednesday.

Beef and lamb exports to key markets fell in July, slicing into overall meat exports, according to Statistics New Zealand.

Total exports in July were 4 billion NZ dollars (2.91 billion U.S. dollars) and total imports were 4.4 billion NZ dollars (3.2 billion U.S. dollars).

Beef export values and quantities to New Zealand's largest beef market, the United States, were down, while lamb values and quantities to the European Union, the largest lamb market, were also down.

Overall, meat exports in July were down 19 percent year on year.

"The meat export falls this month are partly due to record meat exports this time last year," international statistics senior manager Jason Attewell said in a statement.

"Meat values in July 2015, off the back of a record high meat season, were 31 percent higher than the average value for the previous five July months."

Dairy exports also fell, driven down by falling values of milk powder.

Algeria, New Zealand's third-largest destination for milk powder, had the largest fall in July - the value fell 55 percent and the quantity fell 45 percent.

"Algeria's export revenue relies heavily on energy exports. It's been hit hard by the recent falls in the global price of oil," Attewell said.

Crude oil imports fell by almost half in July, accounting for just over a third of the fall in overall goods imports.

In the year to the end of March, goods made up 70 percent of total exports, and 75 percent of total imports.

New Zealand exporters on Wednesday called for more action to tackle the overvalued New Zealand dollar, saying the stubbornly high value was affecting their ability to compete and invest.

Recent cuts in the Reserve Bank of New Zealand's (RBNZ) official cash rate, currently at 2 percent, were having little effect on the exchange rate, according to the New Zealand Manufacturers and Exporters Association (NZMEA).

"The exchange rate remains at a level which threatens exporters and import-competing manufacturers' competitiveness, as well as adding to the challenge of low inflation," NZMEA chief executive Dieter Adam said in a statement.

"The exchange rate has been systemically higher over the last decade - at some point we need to see some real action and assessment of how to combat this, especially if we are to ever meet our goals of increasing exports as a percentage of GDP."

The RBNZ has repeatedly warned that the high value of the New Zealand dollar was unjustifiable and unsustainable. Endit