–Imports Mark 10th Straight Y/Y Fall on Lower Energy Prices, Slower Demand for Smartphones
–Exports to China Post 2nd Straight Rise after A Year-Long Slump; Partly Due to Base Year Effects
–Exports to US Remain Robust; Those to EU Also Up Despite Region’s Sluggish Economic Growth
By Max Sato
(MaceNews) – Japanese export values rose 11.9% on year in January, as largely expected (consensus was 11.5%), after rebounding a revised 9.7% to a record high in December, led by shipments of automobiles, auto parts and semiconductor-producing equipment, data released Wednesday by the Ministry of Finance showed.
Import values fell for the 10th straight month as energy prices remained below year-earlier levels and demand for foreign-made smartphones sagged due to high prices. The pace of decrease accelerated to 9.6% in January from a revised 6.9% in December. The median forecast was a 7.5% drop.
The trade balance recorded a ¥1,758.3 billion (¥1.76 trillion) deficit after chalking up a revised ¥68.89 billion surplus in December, which was the first positive figure in three months. The deficit was narrower than the median forecast of ¥1,923.4 billion (¥1.92 trillion) and much smaller than a record shortfall of ¥3,506.43 billion (¥3.51 trillion) hit in January 2023.
Shipments to China, one of the key export markets for Japanese goods, posted their second straight increase after marking the first year-over-year rise in 13 months in December but the world’s second largest economy is generally struggling to recover under the weight of property market problems. The sharp 29.2% gain in January was partly in reaction to a 17.1 percent slump in January 2023.
In addition, the lunar new year holidays in Asia may be distorting trade data in the region. Last year, when the lunar new year was celebrated around Jan. 22, growth in Japanese export values slowed to a single-digit percentage rise (3.5%) in the month partly due to suspended shipments during the holidays, although Japan does not observe the lunar new year. Cargo flows are expected to slow in February this year, with some rush pre-holiday shipments in January.
Japanese exports to the European Union also posted the second consecutive gain after showing their first year-over-year drop in 33 months in November while exports to the U.S. remained robust, up for the 28th straight month, after rising to a record high in December.
The key points from the MOF’s Trade Statistics:
* Export values rose 11.9% on year to ¥7.33 trillion in January after rising 9.7% in December to a record high of ¥9.65 trillion. The latest figure was slightly above than the median forecast of a 11.5% rise (forecasts ranged from 8.4% to 15.7% gains). The increase was led by continued solid demand for automobiles, semiconductor-producing equipment and auto parts. Shipments of mineral fuels fell.
* Export volumes rose 2.3% on year in January after rising 3.1% in December for the first rise in three months and falling 5.6% in November.
* Import values fell 9.6% on year for the 10th straight decrease after falling 6.9% in December and marking their first decline in 27 months with a 2.7% drop in April 2023. It was larger than the median forecast of a 7.5% fall (forecasts ranged from 16.0% to 2.0% drops). The decrease was led by coal and liquefied natural gas as the prices for energy remain below year-earlier levels. Purchases of telecommunications equipment including smartphones also declined.
* Import volumes dipped 8.4% on year in January for the 15th straight decrease after falling 3.0% in December.
* Exports to China, one of the top export destinations for Japanese goods, jumped 29.2% on year in January after rebounding a revised 9.5% on the year in December for the first rise in 13 months. December exports of ¥1.77 trillion were the second largest on record, only slightly below the record high of ¥1.78 trillion seen in July 2022. The increase in January was led by shipments of semiconductor-producing equipment, automobiles and plastics.
* Japanese exports to Asia as a whole rose 13.5% in January after rising 3.0% in December for the first rise in 12 months. The increase was led by strong demand for semiconductor-producing equipment, automobiles and plastics, as seen in China.
* Exports to the U.S., which have exceeded those to China since October 2022, recorded their 28th straight year-over-year rise, up 15.6% in January, after soaring a revised 20.2% to a record high of ¥2.08 trillion in December. The increase was led by automobiles and auto parts, as seen in recent months, as well as drugs.
* Shipments to the European Union rose 13.8% in January after rising 10.3% in December and posting their first year-over-year drop in 33 months in November with a slight 0.03% dip. The increase reflects solid demand for automobiles, auto parts and organic compounds, as seen in the prior month. Shipments of non-ferrous metals dropped.