5489.0 - International Merchandise Trade, Australia, Concepts, Sources and Methods, 2001

Contents >> Chapter 8. Data Quality >> Relevance

User requirements

8.3 International merchandise trade statistics are widely used in their own right and provide important inputs to the compilation of Australia's Balance of Payments and National Accounts. Interest ranges from analyses of detailed commodity flows and markets to more aggregated information and examination of Australia's trade in a macro-economic context. Aspects of the international trade program are regularly reviewed and users and providers are extensively consulted about changes that are proposed.

8.4 A major review of the international trade program was conducted in 1999-2000. The Review concluded that, to meet core national and international data requirements, the ABS needed to maintain and release international merchandise trade statistics to at least the six digit level of the HS commodity classification. It also needed to undertake sufficient editing to ensure the quality requirements for macro-economic statistics, such as Balance of Payments and National Accounts.

8.5 The Review recognised the need to continue to produce detailed commodity estimates to meet the demonstrated needs of both private sector and government users. However, while there was a clear demand for detailed trade data beyond the six digit HS level, its provision could not be considered ABS core business and, as such, there needed to be full recovery of direct costs associated with this service. The Review determined that there was not full recovery of the direct costs and proposed actions to bring costs and revenue into approximate balance, recognising that it was inappropriate to increase the charges appreciably.

Editing and client queries

8.6 ABS procedures are designed to ensure that sufficient editing is undertaken to guarantee the quality and integrity of trade statistics to at least the six digit HS level. After the release of monthly trade statistics, the ABS may receive a number of client requests to investigate cases of possible misreporting. Most relate to potential errors at the more detailed levels of the commodity classification. The types of possible errors include:

a reported unit value being too high, too low or too volatile;

a possible error in the reported country of origin or final destination;

not enough, too much or no trade showing; or

a possible tariff misclassification.

8.7 Client requests for data investigations of this type will be undertaken free of charge if data at the six-digit level of the HS are affected. Otherwise investigations will only be considered if the value of the aggregate data queried exceeds $250,000 in each month queried, and the cost of the investigation is met by the client. Clients who wish to request data queries, or better understand the process and charges involved, should obtain a copy of an ABS booklet entitled International Trade: Ensuring Data Quality. Copies can be obtained from the Exports and Imports Managers on telephone 02 6252 5401 (exports) or 02 6252 5108 (imports).

External demand

8.8 A measure of the relevance of international merchandise trade statistics is the extent of demand from external clients for the data and services provided. In 1999-2000, $1.1 million of revenue was earned from the sale of international merchandise trade products and services to about one thousand regular subscribers and an unknown number of ad hoc purchasers. The statistics most commonly purchased included information on the quantity and value of trade in particular commodities by overseas country and Australian state. Most subscribers receive data each month. The revenue offsets the direct costs of the provision of the very detailed data, as explained in paragraph 8.5.

8.9 This level of demand is substantial, with the data important to the business needs of many users. Data are supplied in a timely manner and in the form most suitable to the individual client concerned. The main limitations are in the level of commodity detail sought (client requests for more detail have to be balanced against the ability of providers to supply the data and the extra costs involved), restrictions applied to protect business confidentiality, and the accuracy of some information that cannot be fully quality assured due to the sheer volume of data involved and practical resource constraints.

8.10 There are two identified areas of unmet demand - for export data classified by region of production within Australia, and by industry of producer. The ABS has investigated experimental methods of producing regional export estimates, concluding that any methodology is labour-intensive, limited by the level and quality of data available, and not particularly suitable for estimating exports of manufactured goods. Prospects for producing trade data on a standard industry basis are discussed in Chapter 10.

Classifications

8.11 As explained in Chapter 4, Australia's international merchandise trade statistics are classified to the international Harmonised System (HS). In order to meet the finer level data requirements of local users, the ABS maintains the statistical code component of the HTISC and the AHECC. This role includes the implementation of changes resulting from periodic reviews of the international six digit HS classification, occasional systematic reviews of the statistical codes used, and the evaluation of client requests for changes to the detailed commodity information collected.

8.12 Implementation of changes flowing from the most recent review of the international six digit HS classification is discussed in Chapter 10. During 1998-99, a comprehensive review of the HTISC and AHECC classifications was completed by the ABS. The purpose of the review was to assess the relevance and usefulness of the existing statistical codes, given that many had been in place since January 1988. It also considered the cost to industry of providing the detailed information and the cost to government of processing it.

8.13 The review identified many areas in both the HTISC and AHECC where the complexity of the structure hindered the accuracy of reporting and analysis. There were also many codes where the level of trade was low or declining or there was little client interest. As a result of the review, from 1 July 1999, the number of codes for exports and imports was reduced by 11% and 17% respectively. Further information can be found in the article Review of Statistical Codes published in the June Quarter 1999 issue of International Merchandise Trade, Australia (Cat. no. 5422.0).

8.14 Requests for changes to the classifications are received regularly, with those considered justified normally implemented on 1 January or 1 July. During 1999-2000, 15 new export codes and 12 new import codes were implemented. It is through the processes outlined above, that the commodity classifications used are kept both internationally comparable and relevant to Australian clients. Revisions to other classifications used are implemented once the revised structures become available. Country classifications are updated as needed, to reflect the Australian Government's recognition of geopolitical changes.

Price measures

8.15 From detailed value and quantity information released by the ABS, it is often possible to calculate an average unit value (total value divided by total quantity) for exports or imports of a particular commodity. Users of international merchandise trade statistics are advised that there are often serious limitations with the use of derived average unit values as measures of price change over time.

8.16 Average unit values should not be used in the analysis of price movements for commodities that are not homogeneous or likely to be affected by changes over time in compositional mix and quality. For items that are homogeneous, and where quality change is minimal, such as basic mining and agricultural commodities, the limitations are less severe and the data may be useful for this purpose. Users who are interested in price movements in export and import commodities should refer to International Trade Price Indexes, Australia (Cat. no. 6457.0) or the now discontinued separate publications: Export Price Index, Australia (Cat. no. 6405.0) or Import Price Index, Australia (Cat. no. 6414.0).