The Australian trade surplus for April has fallen to just $555 million following a steep drop in coal export levels as a result of disruption caused by Cyclone Debbie.
From a $3.1 billion surplus being recorded for the month of March 2017, April was expected to see a decline in surplus to around $2 billion, but has instead seen a heftier decline mainly resulting from coal export shipments being blown off course by the cyclone that hit Australia earlier this year.
Exports in total fell by about 8% ($2.8bn), whereas imports only fell by 1% ($171m), leaving behind a serious dent in Australia’s trade profit reserves. The severity of the impact of Debbie on economic conditions for April has raised concerns that it will have a lasting effect through the rest of the June quarter as well.
The value of coal exports will be closely monitored when the financial results for May and June are presented as the industry stages a minor rebuilding process after mines, rail lines and ports in Queensland were closed when Cyclone Debbie hit the east coast in late-March.
However, some economists have posited that the slump will only be temporary, as the fallout from Cyclone Debbie was short-lived and the affected systems were operational again by mid-April.
“We already know that after falling by 60 per cent month-on-month in April, the volume of coal leaving the largest three ports in Queensland leapt by 130 per cent in May, thereby taking it almost back to the level seen in March,” Paul Dales from Capital Economics said.
“Total exports may rebound by 10 per cent in May and the trade surplus will leap back above $3 billion.”