New data published by the Australian Bureau of Statistics (ABS) on Thursday showed that the country's trade surplus shrunk to $1.981 billion in the three months leading to December and that number could further slide as the economy starts absorbing the damages wrought by the recent flooding.

According to the new ABS figure, the latest balance of goods and services reflected a retreat from the November surplus of $2.078 billion, upwardly revised, and economist said that future contraction could not be ruled out, which should be largely caused by losses incurred by the coal industry in Queensland.

Despite the retreat, JP Morgan's Ben Jarman told AAP that the December trade surplus was quite good and insisted that the figures actually held in during the entire period.

Jarman said that the actual impact of the Queensland floods on the country's economy would be more apparent once the trade balance for the March quarter comes in, which would highlight a period "when a lot of our coal mines were put under water and production effectively goes to zero."

Already, a number of mining firms are blaming the flooding disaster in Queensland for their losses, with Xstrata declaring on Wednesday that the eight percent drop on its Australian thermal coal production was mostly caused by the floods and the imminent closure of a mine in New South Wales.

Even if the fresh ABS data pointed to flat export growth, bit movement in the import sector and significant numbers from the construction industry, Macquarie economist Benjamin Dinte cautioned that the seeming strength of the Australian economy could partially cloak the almost certain impacts of the floods, which he said "should significantly dampen our coal export volumes."

Dinte added that over the first three months of 2011, prices would surely spike and perhaps offer some form of balancing effect but he pointed out that "we don't think that will be sufficient to prevent a fall in exports."