By Max Sato
— Exports to U.S., EU Rebound in March; Asian Demand Remains Solid
— Japan’s FY20 Exports Dip for 2 Years in a Row; Trade in Surplus
(MaceNews) – Japanese exports rebounded more strongly than expected in March after a temporary slip in February and pre-Lunar New Year rush shipments in January, maintaining a gradual pickup supported by Chinese and U.S. economic recoveries, data released Monday by the Ministry of Finance showed.
Global demand for semiconductor-producing equipment remained solid while automobile exports posted the first year-on-year gain in five months. Semiconductor shortages have forced Japanese carmakers to trim production.
For the whole of fiscal 2020 that ended last month, Japanese exports marked the second consecutive annual decline, hit by slower demand for automobiles, but shipments to China rebounded, thanks to its recovery demand for non-ferrous metals, chip-making equipment and plastics.
The key points from the MOF’s Trade Statistics:
- Exports surged 16.1% on year in March, the first y/y gain in two months after a 4.5% fall in February and a 6.4% rise in January, coming in stronger than the median economist forecast of a 11.6% rise. This is partly in reaction to an 11.7% slump in March 2020, the start of six months of double-digit percentage y/y drops. The increase in March was led by higher shipments of automobiles, non-ferrous metals and plastics.
- Imports rose 5.7% y/y, the second straight rise after posting the first gain in 22 months in February (+11.8%). The median economist forecast was for a 4.7% rise. The increase was led by drugs, iron ore and computers. Imports of crude oil and natural gas declined.
- The trade balance came to a surplus of Y663.7 billion in March, posting the second consecutive positive figure, after a surplus of Y215.9 billion the previous month. The gap was wider than the median economist forecast of a Y490.0 billion surplus.
- The MOF said exports gained a seasonally adjusted 4.3% on month in March and imports dipped 0.7% m/m, resulting in an adjusted trade surplus of Y297.8 billion.
- Exports to China jumped 37.2% from a year earlier in March for the ninth consecutive y/y rise after +3.4% in February and +37.5% in January (the slower pace in February followed pre-Lunar New Year rush purchases seen the previous month). The increase was in March led by strong demand for plastics, raw materials and non-ferrous metals.
- Japanese exports to Asia as whole marked the first y/y rise in two months, up 22.4% on year after -0.8% in February and +19.4% in January.
- Exports to the U.S. posted the first y/y rise in five months in March, up 4.9%, following -14.0% the previous month. The increase was led by automobiles and construction machines.
- Exports to Europe showed the first increase in 20 months, up 12.8% on year after falling 3.3% in February, thanks to strong demand for auto parts, electrical power machinery and automobiles.
- The global pandemic led to the second straight annual decline in Japanese exports in fiscal 2020 (ended March 2021), down 8.4% after -6.0% in fiscal 2019 and +1.9% in fiscal 2018. The decrease was led by automobiles, mineral fuels and auto parts.
- Imports also marked the second straight drop in the last fiscal year, down 11.6% following -6.3% in fiscal 2019 and +7.2% in fiscal 2018. It was mainly due to weak energy prices.
- The sharper decline in imports, compared to the export slump, resulted in the first trade surplus in three years for Japan at Y1.31 trillion in fiscal 2020, following a deficit of Y1.28 trillion in fiscal 2019.
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Contact this reporter: max@macenews.com.
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