Trade surplus up just 1% as imports and exports fall

Ireland’s trade surplus increased by just 1%, or €21m, in June on the back of a fall in both export and import levels.

Latest CSO data, published yesterday, shows a trade surplus total of just under €3.36bn for the month, up on the near €3.34bn level reported in May.

On a month-on-month basis, June saw a 4% decline in the value of seasonally-adjusted Irish exports to €7.64bn; while import value was down by 7% to €4.28bn.

On a year-on-year basis, June saw a 6% increase in export value to €7.78bn — the main drivers of growth being a 7% increase in food and live animals, a 27% jump in the export of professional, scientific and controlling apparatus and a 54% rise in organic chemical exports. The value of imports grew by 4%, year-on-year, to just over €4.2bn.

Reacting to yesterday’s data, Philip O’Sullivan, chief economist with Investec Ireland, said the movement meets expectations, but the year, as a whole, should see decent growth in Ireland’s external trade figures.

“The outlook for exports is underpinned by improving conditions in key trading partners and favourable currency movements, along with the recovery in the pharmaceutical industries based here.”

“As the recovery gathers momentum, we expect to see further upward moves in imports. For 2014, as a whole, we see exports growing by 4%, year-on-year, while imports are expected to grow by 3.5%. In 2015, we see both rising by 3%, year-on-year,” he added.

In terms of geography, the EU was the destination for almost 50% of Irish exports in June, valued at €3.8bn.

The US was the main non-EU destination, accounting for 27% — or just over €2bn- worth of exports.

David McNamara, of Davy Stockbrokers, suggested the impact on Irish exports from Russian sanctions are set to be negligible and the main threat remains the sluggish eurozone economy.

“The recovery in exports, this year, has largely been driven by improved demand from the UK and US, accounting for 39% of exports combined,” he said.