Japan Trade Surplus Shrinks as Exports Fall Further

Japan's trade surplus narrowed to JPY 589 billion in June 2019 from JPY 728 billion in the same month a year earlier and compared to market expectations of a JPY 420 billion surplus. Exports declined for a seventh straight month while imports fell for the second month in a row.

Exports fell 6.7 percent from a year earlier to JPY 6.58 trillion, compared to market consensus of a 5.6 percent drop and May's 7.8 percent fall. It was the seventh straight month of declines in shipments, amid weakening global demand and the US-China trade dispute. Machinery sales plunged 8.0 percent (20 percent of total exports), mainly dragged by a 22.2 percent drop in metalworking machinery and a 7.7 percent slump in power generating machine. Declines were also observed in transport equipment (-7.6 percent) due to motor vehicles (-0.7 percent) and parts (-14.1 percent); electrical machinery (-9.3 percent) on the back of semiconductors (-7.9 percent) electrical apparatus (-11.9 percent) and electrical measuring (-12.6 percent); and manufactured goods (-8.6 percent) such as iron and steel products (-11.6 percent) and nonferrous metals (-11.8 percent). In contrast, exports of chemicals rose 1.5 percent. 

Among main trade partners, exports fell mainly to China (-10.1 percent), Hong Kong (-4.3 percent), South Korea (-14.8 percent), Singapore (-7-9 percent), Australia (-18.7 percent), the EU (-6.7 percent), and the Middle East (-16.4 percent). Still, sales to the US climbed 4.8 percent.

Imports declined 5.2 percent to JPY 6.00 trillion, compared to market expectations of a 0.4 percent decline and following a 1.5 percent drop in the previous month. Purchases were mainly lower for: foodstuff (-2.8 percent); raw materials (-10.8 percent); manufactured goods (-11 percent), such as nonferrous metals (-20.1 percent) and iron and steel products (-16.4 percent); mineral fuels (-4.1 percent), dragged by LNG (-11.7 percent) and petroleum products (-13.1 percent); machinery (-6.0 percent); electrical machinery (-3.3 percent); and transport equipment (-3.0 percent). 

Among main trade partners, imports dropped from China (-5.3 percent), South Korea (-13.6 percent), Australia (-4.1 percent), the US (-2.5 percent), the EU (-3.7 percent), and the Middle East (-6 percent).

Japan Trade Surplus Shrinks as Exports Fall Further

Ministry of Finance | Mario | mario@tradingeconomics.com
7/18/2019 11:59:19 AM