–Japan Posts 15th Straight Month of Trade Deficit on High Oil, Gas Import Costs
–Exports to US Hit Another Record High on Autos, Construction Machines
–Imports from US, EU at Record Highs on Drugs, Energy, Non-Ferrous Metals
–Imports from Asia, China Also New Highs on Smartphones, Clothing
By Max Sato
(MaceNews) – Japanese export values hit another record high in October as easing supply bottlenecks continued supporting the auto industry and prices for fuels and semiconductors remained high, but high energy bills and the weak yen also lifted imports to a fresh all-time high, leading to a 15th consecutive month of a trade deficit, data released Thursday by the Ministry of Finance showed.
Shipments to China, the key export market for Japanese goods, posted the fifth straight year-over-year rise in October, 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 slowed from double-digit percentage gains seen in the previous three months.
The key points from the MOF’s Trade Statistics:
* Exports rose 25.3% to a fresh record high of Y9.0 trillion in October for the 20th straight year-on-year rise after rising 28.9% in September to the previous high of Y8.82 trillion. The pace of growth was slower than the median forecast of a 28.7% gain. Amid slowing global economic growth, export volumes edged down 0.3% on the year, after rising 7.3% in September and falling 1.2% in August.
* The increase in October export values was led by the recent pickup in automobile shipments, thanks to easing global supply constraints, and solid demand and prices for mineral fuels and semiconductors, as largely seen in recent months.
* Shipments of automobiles rose 81.0% on the year (up 27.6% in volumes) in October after surging a revised 122.3% (up 49.3% in volumes) in September and posting a 39.3% rise (up 8.8% in volumes) in August. Auto exports to the U.S., the key market, gained 78.6% (up 25.7% in volumes) after soaring a revised 119.2% (up 73.1% in volumes) in September and rising 34.6% (up 13.4% in volumes) in August.
* On a seasonally adjusted basis, Japan’s exports to the world rose 3.2% on the month in October after rising 3.2% in September.
* Imports surged 53.5% on the year to Y11.16 trillion in October, marking a record high for the eighth consecutive month after rising a revised 45.7% to Y10.91 trillion in September. It was the 21st straight increase and above the median forecast for a 49.6% rise. Import volumes rebounded 5.6% in October after falling 1.8% in September and rising 2.8% in August.
* The increase in import values was led by higher prices for crude oil, natural gas and coal as seen in recent months. The import of drugs grew 74.3% on the year, maintaining a double-digit percentage increase after rising 31.6% in September and rebounding 7.6% in August. The government still needs to buy more Covid vaccines while the seventh wave of the pandemic is emerging in Japan.
* The trade balance came to a deficit of Y2.162 trillion in October. It marked the 15th straight month of a shortfall after posting a revised deficit of Y2.094 trillion in September and a record high shortfall of Y2.820 trillion in August. It compares to a deficit of Y90.72 billion in October 2021. The gap was wider than the consensus forecast of a Y1.688 trillion deficit.
* Exports to China, one of the top export destinations for Japan, posted the fifth straight increase in October, up 7.7% from a year earlier, after rising 17.1% in September, 13.4% in August and climbing 12.8% to a record high Y1.78 trillion in July. The increase was led by solid demand for automobiles, audio and visual equipment and mineral fuels. Imports from China marked the sixth straight gain, rising 39.3% to a fresh record high of Y2.39 trillion, after a revised 30.0% increase to the previous high of Y2.31 trillion in September. It was led by demand for smartphones, clothing and computers.
* Japanese exports to Asia as whole marked the 20th straight year-on-year rise, up 16.6% at Y4.95 trillion in October, after rising 20.6% in September. It was the second largest amount after a record high of Y5.10 trillion hit in July. The increase was led by shipments of semiconductors, automobiles and auto parts. Imports from Asia jumped 46.8% to yet another high of Y5.10 trillion, surpassing the previous high of Y4.88 trillion in September, led by semiconductors, smartphones and clothing.
* Exports to the U.S., another key market (topped exports China), recorded the 13th straight year-on-year rise, climbing 36.5% to a new record high of Y1.78 trillion in October and exceeding the previous high of Y1.68 trillion in September. The increase was led by automobiles, engines and motors as well as construction and mining equipment, as largely seen in the previous month. Imports from the U.S. surged 47.1% for the 20th straight increase, led by continued strong demand for drugs, natural gas and coal.
* Shipments to the European Union posted the 20th straight year-on-year increase in October, up 28.1%, following a 33.2% rise the previous month, led by automobiles, motorcycles and optical equipment. Imports from the EU jumped 40.2% to a fresh record high, reflecting solid demand for drugs, automobiles and non-ferrous metals.