–Japan Posts 16th Straight Month of Trade Deficit on High Oil, Gas Import Costs
–Exports to US Remain High After Hitting Record High Amount in October
–Pace of Exports to China Continues to Slow After Picking Up from Lockdown Impact
By Max Sato
(MaceNews) – Japanese export values posted a slower pace of growth on lower global demand in November, with a notable slowdown in China, after hitting a fresh record high in October on easing supply bottlenecks, while the yen’s recent rebound eased the pain of rising import costs, leading to a slightly narrower trade deficit from the previous month, data released Thursday by the Ministry of Finance showed.
Shipments to China, the key export market for Japanese goods, posted the sixth straight year-over-year rise in November, recovering from the negative impact of a two-month Covid lockdown of the port city of Shanghai that was lifted at the end of May, but the pace of increase continued decelerating from double-digit percentage gains seen from July to September.
The key points from the MOF’s Trade Statistics:
* Exports rose 20.0% on the year to the second largest amount on record to ¥8.84 trillion in November for the 21st straight rise after hitting a fresh record high of ¥9.0 trillion in October. The pace of growth was slightly slower than the median forecast of a 20.8% gain. Amid slowing global economic growth, export volumes fell 3.6% on the year after edging down 0.3% in October and rising 7.3% in September.
* The increase in November export values was led by the recent pickup in automobile shipments, thanks to easing global supply constraints, and solid demand construction and mining equipment.
* Shipments of automobiles rose 38.3% on the year in November (up 10.3% in volumes) after rising 80.0% (up 27.5% in volumes) in October and surging 122.3% (up 49.3% in volumes) in September. Auto exports to the U.S., the key market, gained 41.1% (up 1.7% in volumes) after rising 78.6% (up 25.7% in volumes) in October and soaring 119.2% (up 73.1% in volumes) in September.
* On a seasonally adjusted basis, Japan’s exports to the world fell 1.3% on the month in November after rising 3.2% in October.
* Imports rose 30.0% on the year to ¥10.87 billion in November after surging 53.5% to ¥11.17 trillion in October, which was a record high amount for the eighth consecutive month. It was the 22nd straight increase and exceeded the median forecast of a 27.4% rise. Import volumes dipped 4.6% in November after rebounding 5.6% in October and falling 1.8% in September.
* The increase in import values was led by higher prices for crude oil, coal and natural gas, compared to year-earlier levels, as seen in recent months. The import of drugs grew 47.4% on the year, maintaining a double-digit percentage increase after rising 74.3% in October and
30.9% in September. The government still needs to buy more vaccines as new Covid cases are rising during the eighth wave of the pandemic.
* The trade balance came to a deficit of ¥2.027 trillion in November. It marked the 16th straight month of a shortfall after posting a revised deficit of ¥2,166.2 billion in October and a record high shortfall of ¥2.820 trillion in August. It compares to a deficit of ¥973.56 billion in November 2021. The gap was wider than the consensus forecast of a ¥1.672 trillion deficit.
* Exports to China, one of the top export destinations for Japanese goods, posted the sixth straight increase in November, up 3.5% from a year earlier at ¥1.63 trillion, after rising 7.7% in October, 17.1% in September, 13.4% in August and climbing 12.8% to a record high ¥1.78 trillion in July. The increase was led by solid demand for audio and visual equipment, materials and automobiles while exports of semiconductor-producing equipment and auto parts declined. Imports from China marked the seventh straight gain, rising 17.1%, after surging 39.3% to a fresh record high of ¥2.39 trillion in October.
* Japanese exports to Asia as whole marked the 21st straight year-on-year rise, up 11.6% at ¥4.80 trillion in November, after rising 16.6% in October to ¥4.95 trillion, which was the second largest amount after a record high of ¥5.10 trillion hit in July. The increase was led by shipments of semiconductors, automobiles and ships. Imports from Asia rose 26.9% after rising 46.8% to a fresh record high of ¥5.10 trillion in October, led by semiconductors, natural gas and coal.
* Exports to the U.S., another key market (topped exports to China in recent months), recorded the 14th straight year-on-year rise, climbing 32.5% to ¥1.72 trillion in November, after rising 36.5% to a record high of ¥1.78 trillion in October. The increase was led by automobiles, construction and mining equipment and drugs, as largely seen in the previous month
* Shipments to the European Union posted the 21st straight year-on-year increase in November, up 32.0%, following a 28.1% rise the previous month, led by automobiles, iron and steel as well as motorcycles.