Australia’s August Trade Surplus Improves; Exports Jump 8%
Thanks to coal and ore, Australia's trade surplus in August improved remarkably and showed signs of continued recovery despite the summer floods that forced many mines to close and fears of a global slowdown.
The Australian Bureau of Statistics reported Tuesday that the trade surplus grew to $3.1 billion in August from $1.817 billion in July. The same data also revealed shipments from Australia increased 8 per cent from the previous month, while imports jumped 3 per cent.
The latest data translated to a trade surplus of 3.1 billion Australian dollars ($2.9 billion U.S.), the second-largest on record. Market analysts earlier had forecast a surplus of $1.95 billion for the month.
Total iron ore exports jumped 17 per cent due to a 22 per cent gain in exports to China and 21 per cent uptick to Japan.
"The continued return to more normal levels of coal production (and) exports following the floods in Queensland at the start of the year are underpinning the export profile at the moment and likely to continue to do so into early 2012," RBC Capital Markets senior economist Su-Ling Ong told The Sydney Morning Herald.
"The details of today's data were a pleasant surprise," she said.
While other analysts highlighted the demand of Asian countries India and China were a huge motivation for the month's trade surplus performance. There might be a slowdown, but because these countries are in dire need of these mineral shipments, that would be enough to ensure Australia's export sector to continue its momentum despite global demand weakening concerns and erratic market prices of the two commodities.
Internal developments within the two countries, such as rapid urbanization, push demand for improved power generation capacity to meet electricity requirements.
Based from that, Australian exports of minerals to India and China will continue whatever the market forces might declare.