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Thursday, Sep. 22, 2011
Energy imports snuff out export recovery
Trade deficit for August soars to 32-year high on nuclear outage
By JUN HONGO
Exports in August rose for the first time since the March 11 earthquake, up 2.8 percent from a year earlier, but an increase in energy resource imports resulted in a trade deficit of ¥775.3 billion for the month, the Finance Ministry said Wednesday.
Despite signs that domestic production is on the path to recovery, the trade deficit was the largest for the month of August since 1979. It was the first deficit in three months and follows a surplus of ¥72.5 billion in July.
Exports rose 2.8 percent compared with August 2010 and reached ¥5.36 trillion, while imports rose 19.2 percent to ¥6.13 trillion, up for the 20th straight month, according to the ministry's preliminary report.
Japanese exports were led by overseas sales of automobiles, ships and steel, the report says, with a ministry official citing the "supply chain recovery" following the damages by the March quake and tsunami.
Automobile exports entered positive territory for the first time since March, rising 5.3 percent from a year earlier.
But the growth wasn't as robust as some analysts had predicted, and was far from covering the surge in imports that included a 39.9 percent rise in crude and raw oil purchases and a 55.7 percent increase in the import of liquefied natural gas.
Imports of LNG hit a record high 7.54 million tons in August.
Exports rose "at a high rate of approximately 20 percent" compared with last month, a Finance Ministry official said, pointing out that the shutdown of nuclear power plants across the country has resulted in a high dependency on imported energy resources.
"There is the factor that nuclear energy needed to be replaced with other sources, which caused the high level of imports," the official explained.
By region, Japan's trade surplus with the U.S. rose for the first time in five months, by 5.1 percent, to ¥299.7 billion. Exports of automobiles to the U.S. grew by 15.3 percent from a year earlier, and metal-working machines by 40.2 percent.
Sales of automobile parts to China grew by 23.6 percent, but the deficit in trade with China continued for the sixth straight month, hitting ¥228.3 billion, on a decrease in the export of semiconductors and other electronic devices, which fell by 7.1 percent.
The import of computers and related parts from China grew by 31.2 percent.
The yen advanced 9.8 percent against the dollar in August from a year earlier but did not have much overall positive impact on importers because the average price of oil has remained at a high level, the ministry official said. The trade statistics released Wednesday are measured on a customs-cleared basis and will later be adjusted for seasonal factors.
Japan will take "decisive action" in foreign exchange markets if necessary, Finance Minister Jun Azumi said Wednesday, indicating possible intervention to weaken the yen after the currency advanced against the dollar earlier in the day.
"We are very closely watching speculative moves and will take decisive action when it proves necessary," Azumi said after the dollar briefly fell to around ¥76.10.