South Africa posts 8.6 billion-rand trade deficit in August

South Africa’s trade balance swung to a deficit in August after three months of surpluses as shipments of precious metals and stones, which include gold and diamonds slumped.

The 8.6 billion-rand ($619 million) deficit compares with a revised surplus of 5 billion rand in July, the Pretoria-based South African Revenue Service said in an e-mailed statement on Friday. The median of 10 economist estimates compiled by Bloomberg was for a surplus of 1.6 billion rand.

South Africa recorded its first quarterly trade surplus in a year in the three months through June as mining exports surged, helping to narrow the deficit on the current account, the broadest measure of goods and services, to 3.1 percent of gross domestic product from 5.3 percent. The smaller current-account gap would benefit the rand, which has gained 12 percent against the dollar this year after losing 25 percent of its value against the U.S. currency in 2015.

“Even though this month number is not good, the trend in 2016 so far is definitely better than last year, which is supportive of the rand,” Christie Viljoen, an economist at KPMG LLP in Cape Town, said by phone. “It helps keep the current-account deficit lower.”

Cumulative Surplus

The cumulative surplus for the first eight months of 2016 is 7.4 billion rand compared with a shortfall of 35.1 billion in the same period last year.

Exports decreased by 5.5 percent to 90.2 billion rand as the shipments of precious metals and stones fell by 30 percent and vehicles and transport equipment declined by 10 percent. Imports rose by 9.2 percent to 98.8 billion rand as the purchases of mineral products, which include oil, increased by 24 percent.

The rand strengthened 0.7 percent to 13.7920 per dollar as of 3:57 p.m. in Johannesburg. Yields on rand-denominated government bonds due December 2026 fell one basis point to 8.66 percent.

Monthly trade figures are often volatile, reflecting the timing of shipments of commodities such as oil and diamonds.

The South African Revenue Service (SARS) has released trade statistics for August 2016 recording a trade balance deficit of R8.56 billion. The cumulative trade balance surplus (01 January to 31 August 2016) of R7.41 billion is an improvement on the deficit for the comparable period in 2015 of R35.10 billion. These statistics include trade data with Botswana, Lesotho, Namibia and Swaziland (BLNS).

Including trade data with Botswana, Lesotho, Namibia and Swaziland (BLNS)

The R8.56 billion trade balance deficit for August 2016 is attributable to exports of R90.24 billion and imports of R98.80 billion. Exports for the year-to-date grew by 9.0% from R679.27 billion to R740.70 billion. Imports for the year-to-date of R733.29 billion are 2.6% more than the imports recorded in January to August 2015 of R714.37 billion.

On a year-on-year basis, August 2016’s R8.56 billion trade balance deficit is an improvement from the deficit recorded in August 2015 of R10.45 billion. Exports of R90.24 billion are 3.6% more than the exports recorded in August 2015 of R87.10 billion. Imports of R98.80 billion are 1.3% more than the imports recorded in August 2015 of R97.55 billion.

July 2016’s trade balance surplus was revised downwards by R0.18 billion from the previous month’s preliminary surplus of R5.22 billion to a revised surplus of R5.04 billion as a result of ongoing Vouchers of Correction (VOC’s).

Exports decreased from July 2016 to August 2016 by R5.29 billion (5.5%) and imports increased from July 2016 to August 2016 by R8.31 billion (9.2%).

Trade highlights by category

The main month-on-month export movements (R’ million):

The main month-on-month import movements (R’ million):

Trade highlights by world zone

The world zone results from July 2016 (Revised) to August 2016 are given below.

Africa:

Trade Balance surplus: R14 663 million – this is a 4.4% decrease in comparison to the R15 339 million surplus recorded in July 2016.

America:

Trade Balance deficit: R4 574 million – this is a 442.6% increase in comparison to the R843 million deficit recorded in July 2016.

Asia:

Trade Balance deficit: R16 505 million – this is a 34.2% increase in comparison to the R12 303 million deficit recorded in July 2016.

Europe:

Trade Balance deficit: R6 660 million – this is a 0.3% decrease in comparison to the R6 677 million deficit recorded in July 2016.

Oceania:

Trade Balance surplus: R 83 million – this is an improvement in comparison to the R 542 million deficit recorded in July 2016.

Excluding trade data with Botswana, Lesotho, Namibia and Swaziland (BLNS)

The trade data excluding BLNS for August 2016 recorded a trade balance deficit of R18.09 billion. This was a result of exports of R77.67 billion and imports of R95.76 billion.

Exports decreased from July 2016 to August 2016 by R6.58 billion (7.8%) and imports increased from July 2016 to August 2016 by R7.89 billion (9.0%).

The cumulative deficit for 2016 is R62.11 billion compared to R104.40 billion in 2015.

Trade highlights by category

The main month-on-month export movements (R’ million):

The main month-on-month import movements (R’ million):

Trade highlights by world zone

The world zone results for Africa excluding BLNS from July 2016 (Revised) to August 2016 are given below.

Africa:

Trade Balance surplus: R5 132 million – this is a 23.2% decrease in comparison to the R6 681 million surplus recorded in July 2016.

Botswana, Lesotho, Namibia and Swaziland (Only)

Trade statistics with the BLNS for August 2016 recorded a trade balance surplus of R9.53 billion. This was a result of exports of R12.56 billion and imports of R3.03 billion.

Exports increased from July 2016 to August 2016 by R1.29 billion (11.5%) and imports increased from July 2016 to August 2016 by R0.42 billion (16.1%).

The cumulative surplus for 2016 is R69.51 billion compared to R69.30 billion in 2015.

Trade Highlights by Category

The main month-on-month export movements (R’ million):

The main month-on-month import movements (R’ million):