ANALYSIS AND COMMENTS


BALANCE ON GOODS AND SERVICES

In trend terms, the balance on goods and services was a surplus of $2,796m in December 2018, an increase of $131m on the surplus in November 2018.

In seasonally adjusted terms, the balance on goods and services was a surplus of $3,681m in December 2018, an increase of $1,425m on the surplus in November 2018.

The sum of seasonally adjusted balances for the three months to December 2018 was a surplus of $8,222m, an increase of $1,974m on the surplus of $6,248m for the three months to September 2018. However, if seasonal factors used in compiling the quarterly balance of payments are applied, the preliminary December quarter 2018 surplus was $8,506m, an increase of $2,712m on the September quarter 2018 surplus of $5,794m.

GOODS AND SERVICES SUMMARY(a), Seasonally Adjusted and Trend
							Change in:
				Oct 2018	Nov 2018	Dec 2018	Dec 2018	Dec 2018
				$m	$m	$m	$m	%
Seasonally Adjusted
BALANCE on goods and services				2 285	2 256	3 681	1 425	63
CREDITS
	Total goods and services			38 112	38 558	37 924	-634	-2
		Total goods		30 156	30 592	29 942	-650	-2
			Rural goods(b)	3 752	3 703	4 056	353	10
			Non-rural goods(b)	25 224	25 028	25 061	33	-
			Net exports of goods under merchanting(c)	37	37	36	-1	-3
			Non-monetary gold(c)	1 143	1 824	790	-1 034	-57
		Total services		7 956	7 966	7 982	16	-
DEBITS
	Total goods and services			-35 827	-36 302	-34 244	-2 058	-6
		Total goods		-27 556	-28 013	-25 734	-2 279	-8
			Consumption goods	-8 737	-9 025	-8 372	-653	-7
			Capital goods	-6 688	-6 928	-5 858	-1 070	-15
			Intermediate and other merchandise goods	-11 804	-11 703	-10 986	-717	-6
			Non-monetary gold(c)	-327	-357	-518	161	45
		Total services		-8 271	-8 288	-8 510	222	3
Trend(d)
BALANCE on goods and services				2 482	2 665	2 796	131	5
CREDITS
	Total goods and services			37 849	38 033	38 139	106	-
		Total goods		29 902	30 057	30 143	86	-
			Rural goods(b)	3 930	3 890	3 856	-34	-1
			Non-rural goods(b)	24 472	24 819	25 075	256	1
			Net exports of goods under merchanting	31	35	38	3	9
			Non-monetary gold	1 467	1 313	1 174	-139	-11
		Total services		7 947	7 976	7 995	19	-
DEBITS
	Total goods and services			-35 366	-35 368	-35 343	-25	-
		Total goods		-27 042	-27 000	-26 943	-57	-
			Consumption goods	-8 711	-8 698	-8 686	-12	-
			Capital goods	-6 496	-6 465	-6 407	-58	-1
			Intermediate and other merchandise goods	-11 442	-11 465	-11 478	13	-
			Non-monetary gold	-394	-373	-372	-1	-
		Total services		-8 324	-8 367	-8 399	32	-
- nil or rounded to zero (including null cells)
(a) For sign conventions, see paragraph 15 of the Explanatory Notes.
(b) For all time periods, estimates for sugar, sugar preparations and honey are included in Non-rural goods.
(c) This component is not seasonally adjusted.
(d) Caution should be used when interpreting recent trend estimates as they may be affected by unusual economic factors. For more details on trend estimates, see paragraph 19 of the Explanatory Notes.

EXPORTS OF GOODS AND SERVICES

Between November and December 2018, the trend estimate of goods and services credits rose $106m to $38,139m.

In seasonally adjusted terms, goods and services credits fell $634m (2%) to $37,924m. Non-monetary gold fell $1,034m (57%) and net exports of goods under merchanting fell $1m (3%). Rural goods rose $353m (10%) and non-rural goods rose $33m. Services credits rose $16m.


Exports of goods

GOODS CREDITS, Seasonally Adjusted
							Change in:
				Oct 2018	Nov 2018	Dec 2018	Dec 2018	Dec 2018
				$m	$m	$m	$m	%
Total goods credits				30 156	30 592	29 942	-650	-2
	General merchandise			28 976	28 731	29 116	385	1
		Rural goods		3 752	3 703	4 056	353	10
			Meat and meat preparations	1 145	1 159	1 180	21	2
			Cereal grains and cereal preparations	420	447	738	291	65
			Wool and sheepskins	355	319	312	-7	-2
			Other rural(a)	1 831	1 778	1 826	48	3
		Non-rural goods		25 224	25 028	25 061	33	-
			Metal ores and minerals(b)	8 085	8 442	8 261	-181	-2
			Coal, coke and briquettes(c)	6 370	5 782	5 620	-162	-3
			Other mineral fuels(b)(d)	5 310	5 427	5 370	-57	-1
			Metals (excl. non-monetary gold)	1 144	1 127	1 265	138	12
			Machinery	919	898	971	73	8
			Transport equipment	376	339	758	419	124
			Other manufactures	2 026	1 954	1 800	-154	-8
			Other non-rural (incl. sugar and beverages)(a)	807	874	849	-25	-3
			Goods procured in ports by carriers(d)	187	185	166	-19	-10
	Net exports of goods under merchanting(e)			37	37	36	-1	-3
	Non-monetary gold(e)			1 143	1 824	790	-1 034	-57
- nil or rounded to zero (including null cells)
(a) For all time periods, estimates for sugar, sugar preparations and honey are included in Other non-rural.
(b) From July 2005, this component is seasonally adjusted using seasonal factors derived from a monthly volume series.
(c) From July 1971 to June 2005, only a length-of-month adjustment has been applied to this component. From July 2005, this component is seasonally adjusted using seasonal factors derived from a monthly volume series.
(d) In using these seasonally adjusted series, care should be exercised because of the difficulties associated with reliably estimating the seasonal pattern.
(e) This component is not seasonally adjusted.

RURAL GOODS

In trend terms, exports of rural goods fell $34m (1%) to $3,856m.

In seasonally adjusted terms, exports of rural goods rose $353m (10%) to $4,056m.

The main components contributing to the rise in seasonally adjusted estimates were:

• cereal grains and cereal preparations, up $291m (65%)
• other rural, up $48m (3%).

NON-RURAL GOODS

In trend terms, exports of non-rural goods rose $256m (1%) to $25,075m.

In seasonally adjusted terms, exports of non-rural goods rose $33m to $25,061m.

The main components contributing to the rise in seasonally adjusted estimates were:

• transport equipment, up $419m
• metals (excl. non-monetary gold), up $138m (12%).

Partly offsetting these rises were:

• metal ores and minerals, down $181m (2%)
• coal, coke and briquettes, down $162m (3%)
• other manufactures, down $154m (8%).

For price and volume details, see the Selected commodities section.

NET EXPORTS OF GOODS UNDER MERCHANTING

In trend terms, net exports of goods under merchanting rose $3m (9%) to $38m.

In seasonally adjusted terms, net exports of goods under merchanting fell $1m (3%) to $36m.

NON-MONETARY GOLD

In trend terms, exports of non-monetary gold fell $139m (11%) to $1,174m.

In original and seasonally adjusted terms, exports of non-monetary gold fell $1,034m (57%) to $790m.


Exports of services

SERVICES CREDITS, Seasonally Adjusted
						Change in:
			Oct 2018	Nov 2018	Dec 2018	Dec 2018	Dec 2018
			$m	$m	$m	$m	%
Total services credits			7 956	7 966	7 982	16	-
	Manufacturing services on physical inputs owned by others(a)		-	-	-	-	-
	Maintenance and repair services n.i.e.(a)		3	4	4	-	-
	Transport		646	649	652	3	-
		Passenger(b)	253	256	260	4	2
		Freight(c)	35	34	33	-1	-3
		Other	238	238	237	-1	-
		Postal and courier services(d)	121	121	122	1	1
	Travel		5 258	5 250	5 247	-3	-
	Other services		2 049	2 064	2 079	15	1
Memorandum item
	Tourism related services credits(e)		5 511	5 506	5 507	1	-
- nil or rounded to zero (including null cells)
(a) This component is not seasonally adjusted.
(b) Passenger services includes agency fees and commissions for air transport.
(c) In using these seasonally adjusted series, care should be exercised because of the difficulties associated with reliably estimating the seasonal pattern.
(d) Postal and courier services includes indirect commissions for sea transport.
(e) For a more detailed explanation of tourism related services, see paragraph 29 of the Explanatory Notes.

In trend terms, services credits rose $19m to $7,995m.

In seasonally adjusted terms, services credits rose $16m to $7,982m.

The main component contributing to the rise in seasonally adjusted estimates was other services, up $15m (1%).

In seasonally adjusted terms, tourism related services credits rose $1m to $5,507m.

In seasonally adjusted terms, total services credits contributed 21% of total goods and services exported.


IMPORTS OF GOODS AND SERVICES

Between November and December 2018, the trend estimate of goods and services debits fell $25m to $35,343m.

In seasonally adjusted terms, goods and services debits fell $2,058m (6%) to $34,244m. Capital goods fell $1,070m (15%), intermediate and other merchandise goods fell $717m (6%) and consumption goods fell $653m (7%). Non-monetary gold rose $161m (45%). Services debits rose $222m (3%).


Imports of goods

GOODS DEBITS(a), Seasonally Adjusted
							Change in:
				Oct 2018	Nov 2018	Dec 2018	Dec 2018	Dec 2018
				$m	$m	$m	$m	%
Total goods debits				-27 556	-28 013	-25 734	-2 279	-8
	General merchandise			-27 229	-27 656	-25 216	-2 440	-9
		Consumption goods		-8 737	-9 025	-8 372	-653	-7
			Food and beverages, mainly for consumption	-1 316	-1 279	-1 302	23	2
			Household electrical items	-537	-516	-519	3	1
			Non-industrial transport equipment	-1 928	-2 159	-1 612	-547	-25
			Textiles, clothing and footwear	-1 623	-1 620	-1 607	-13	-1
			Toys, books and leisure goods	-565	-612	-559	-53	-9
			Consumption goods n.e.s.	-2 769	-2 838	-2 775	-63	-2
		Capital goods		-6 688	-6 928	-5 858	-1 070	-15
			Machinery and industrial equipment	-2 043	-2 019	-1 857	-162	-8
			ADP equipment	-1 100	-962	-905	-57	-6
			Telecommunications equipment	-1 401	-1 142	-1 078	-64	-6
			Civil aircraft and confidentialised items(b)(c)	-468	-834	-325	-509	-61
			Industrial transport equipment n.e.s.	-1 020	-1 087	-969	-118	-11
			Capital goods n.e.s.(d)	-656	-886	-724	-162	-18
		Intermediate and other merchandise goods		-11 804	-11 703	-10 986	-717	-6
			Food and beverages, mainly for industry	-169	-161	-167	6	4
			Primary industrial supplies n.e.s.(d)	-133	-222	-173	-49	-22
			Fuels and lubricants(c)	-3 889	-3 690	-3 402	-288	-8
			Parts for transport equipment	-1 117	-1 112	-1 141	29	3
			Parts for ADP equipment	-59	-68	-53	-15	-22
			Other parts for capital goods	-1 602	-1 616	-1 480	-136	-8
			Organic and inorganic chemicals	-316	-286	-310	24	8
			Paper and paperboard	-220	-219	-211	-8	-4
			Textile yarn and fabrics	-128	-128	-127	-1	-1
			Iron and steel	-307	-377	-320	-57	-15
			Plastics	-412	-407	-374	-33	-8
			Processed industrial supplies n.e.s.	-3 236	-3 248	-3 060	-188	-6
			Other merchandise goods(b)(e)	-82	-34	-33	-1	-3
			Goods procured in ports by carriers(c)	-134	-134	-134	-	-
	Non-monetary gold(c)			-327	-357	-518	161	45
- nil or rounded to zero (including null cells)
(a) For sign conventions, see paragraph 15 of the Explanatory Notes.
(b) From July 2008, commodities subject to a 'no commodity details' or 'no value details' restriction are included in Civil aircraft and confidentialised items. For earlier periods, commodities subject to a 'no commodity details' or 'no value details' restriction are included in Other merchandise goods.
(c) This component is not seasonally adjusted.
(d) In using these seasonally adjusted series, care should be exercised because of the difficulties associated with reliably estimating the seasonal pattern.
(e) From July 1981, this component is not seasonally adjusted.

CONSUMPTION GOODS

In trend terms, imports of consumption goods fell $12m to $8,686m.

In seasonally adjusted terms, imports of consumption goods fell $653m (7%) to $8,372m.

The main components contributing to the fall in seasonally adjusted estimates were:

• non-industrial transport equipment, down $547m (25%)
• consumption goods n.e.s., down $63m (2%)
• toys, books and leisure goods, down $53m (9%).

CAPITAL GOODS

In trend terms, imports of capital goods fell $58m (1%) to $6,407m.

In seasonally adjusted terms, imports of capital goods fell $1,070m (15%) to $5,858m.

The main components contributing to the fall in seasonally adjusted estimates were:

• civil aircraft and confidentialised items, down $509m (61%)
• capital goods n.e.s., down $162m (18%)
• machinery and industrial equipment, down $162m (8%)
• industrial transport equipment n.e.s., down $118m (11%).

INTERMEDIATE AND OTHER MERCHANDISE GOODS

In trend terms, imports of intermediate and other merchandise goods rose $13m to $11,478m.

In seasonally adjusted terms, imports of intermediate and other merchandise goods fell $717m (6%) to $10,986m.

The main components contributing to the fall in seasonally adjusted estimates were:

• fuels and lubricants, down $288m (8%)
• processed industrial supplies n.e.s., down $188m (6%)
• other parts for capital goods, down $136m (8%).

NON-MONETARY GOLD

In trend terms, imports of non-monetary gold fell $1m to $372m.

In original and seasonally adjusted terms, imports of non-monetary gold rose $161m (45%) to $518m.


Imports of services

SERVICES DEBITS(a), Seasonally Adjusted
						Change in:
			Oct 2018	Nov 2018	Dec 2018	Dec 2018	Dec 2018
			$m	$m	$m	$m	%
Total services debits			-8 271	-8 288	-8 510	222	3
	Manufacturing services on physical inputs owned by others(b)		-	-	-	-	-
	Maintenance and repair services n.i.e.(b)		-72	-93	-58	-35	-38
	Transport		-1 572	-1 581	-1 588	7	-
		Passenger(c)	-614	-618	-683	65	11
		Freight	-866	-872	-813	-59	-7
		Other(b)	-77	-77	-78	1	1
		Postal and courier services(d)(e)	-15	-15	-15	-	-
	Travel		-4 142	-4 113	-4 343	230	6
	Other services		-2 485	-2 501	-2 521	20	1
Memorandum item
	Tourism related services debits(f)		-4 756	-4 731	-5 026	295	6
- nil or rounded to zero (including null cells)
(a) For sign conventions, see paragraph 15 of the Explanatory Notes.
(b) This component is not seasonally adjusted.
(c) Passenger services includes agency fees and commissions for air transport.
(d) Postal and courier services includes indirect commissions for sea transport.
(e) In using these seasonally adjusted series, care should be exercised because of the difficulties associated with reliably estimating the seasonal pattern.
(f) For a more detailed explanation of tourism related services, see paragraph 29 of the Explanatory Notes.

In trend terms, services debits rose $32m to $8,399m.

In seasonally adjusted terms, services debits rose $222m (3%) to $8,510m.

The main component contributing to the rise in seasonally adjusted estimates was travel, up $230m (6%).

Partly offsetting this rise was maintenance and repair services n.i.e., down $35m (38%).

In seasonally adjusted terms, tourism related services debits rose $295m (6%) to $5,026m.

In seasonally adjusted terms, total services debits contributed 25% of total goods and services imported.


Selected commodities

Selected commodities, quantity and unit value analysis - International merchandise trade basis(a): Original terms
		Change in:
		Jul 2018	Aug 2018	Sep 2018	Oct 2018	Nov 2018	Dec 2018
		%	%	%	%	%	%
Iron ore
Lump
	Quantity	-3	-3	1	1	-6	18
	Unit value	5	1	8	5	-	-2
Fines
	Quantity	-12	9	-1	-4	-4	16
	Unit value	3	3	4	4	-	-4
Coal
Hard coking
	Quantity	-11	-4	8	3	-6	-5
	Unit value	2	-1	1	p8	p-4	p-1
Semi-soft
	Quantity	-19	17	-5	3	16	-
	Unit value	2	-2	-1	2	-3	2
Thermal
	Quantity	10	-9	-7	12	-21	32
	Unit value	7	5	-2	p2	-5	p-3
Gas
LNG
	Quantity	16	-	-6	10	2	1
	Unit value	3	6	7	1	-	3
- nil or rounded to zero (including null cells)
p preliminary figure or series subject to revision
(a) Data in this table are on a revised international merchandise trade basis and exclude value adjustments applied to balance of payments series.

International merchandise trade exports data presented in the above table are based on information reported by exporters to the Department of Home Affairs (Home Affairs). For commodities such as iron ore and coal, newly negotiated contract prices are not fully reflected in data first reported to Home Affairs. Final quantity and/or unit price information is updated progressively in international merchandise trade data as exporters revise the information provided to Home Affairs. When additional information for these commodities is available, the ABS may adjust the data to reflect actual transaction values.

Unit values in this publication are presented in Australian dollar terms. Movements in the unit values for some commodities incorporate movements in the United States dollar prices reported to Home Affairs and movements in the Australian dollar to United States dollar exchange rate.

On an international merchandise trade basis, in original terms (noting the footnote in the above table), between November and December 2018 the largest movements recorded for the following selected commodities were:

Iron ore lump, up $259m (16%), with quantities up 18% and unit values down 2%. Exports to:

• China (excluding SARs and Taiwan) rose $215m (17%), with quantities up 21% and unit values down 3%
• Japan rose $74m (46%), with quantities up 34% and unit values up 9%
• the Republic of Korea fell $39m (34%), with quantities down 30% and unit values down 5%.

Iron ore fines, up $438m (12%), with quantities up 16% and unit values down 4%. Exports to:

• China (excluding SARs and Taiwan) rose $351m (12%), with quantities up 17% and unit values down 5%
• Japan rose $95m (54%), with quantities up 47% and unit values up 5%.

Hard coking coal, down $133m (5%), with quantities down 5% and unit values down 1%. Exports to:

• India fell $280m (36%), with quantities down 35% and unit values down 2%
• Spain fell $72m, with no exports in December 2018
• China (excluding SARs and Taiwan) rose $180m (34%), with quantities up 34%
• Japan rose $47m (14%), with quantities up 16% and unit values down 2%.

Semi-soft coal, up $13m (1%), with unit values up 2%. Exports to:

• China (excluding SARs and Taiwan) rose $51m (33%), with quantities up 34% and unit values down 1%
• the Republic of Korea rose $37m (20%), with quantities up 12% and unit values up 7%
• Brazil rose $31m, with unit values down 29%
• Japan fell $117m (35%), with quantities down 36% and unit values up 1%.

Thermal coal, up $531m (28%), with quantities up 32% and unit values down 3%. Exports to:

• the Republic of Korea rose $279m, with unit values up 1%
• Japan rose $185m (21%), with quantities up 25% and unit values down 3%
• China (excluding SARs and Taiwan) rose $38m (11%), with quantities up 15% and unit values down 4%
• Vietnam rose $22m (51%), with quantities up 62% and unit values down 7%.

Liquefied natural gas (LNG), up $166m (4%), with quantities up 1% and unit values up 3%.