JAPAN-N.Z. TRADE—I 40 p.c. Decline In Exports In 1961

Press, Volume CII, Issue 30043, 30 January 1963, Page 15

JAPAN-N.Z. TRADE—I 40 p.c. Decline In Exports In 1961

[By R. 1. BLAZEF, Tokyo corrospemdont of "TM Press"] TOKYO, January 23. New Zealand’s trade with Japan fell back by about 40 per cent, last year from 1961 when New Zealand sold a record £14,822,000 (f.o.b. N.Z.) to Japan and bought £8,350,000 (cxl.v. N.Z.) in Japanese goods. The reason for the decline is as obvious as it is temporary, the balance of payments difficulties, tight money and import restrictions on both sides from about mid-1961 onwards.

The outlook for 1963 is somewhat better with New Zealand securing the mutton tariff at no more than 10 per cent and without quantitative restrictions, “voluntary" or otherwise.

Almost 23,000 tons of mutton were brought into Japan in 1961 (valued at 5310,000 United States dollars C.iX Japan) mostly from New Zealand. At that time a slump occurred on the domestic market which reduced the price of pork to less than that of mutton.

The Japanese fanners complained mutton was intruding excessively into the processing market and the Japanese Government in 1962

issued an “administrative guidance” to importers of s mutton to hold down to about j 8000 tons a year. < A senior official tn charge , of trade with the British , Commonwealth nations then disclosed that the Japanese • were seeking to apply a “little • gentle pressure” to persuade New Zealand to grant Japan most-favoured-nation treatment under the General Agreement on Tariffs and Trade, a concession they later obtained from the New Zealand Minister of Trade, Mr J. R. MarshaH, and had confirmed in trade treaty talks in Geneva on December 28, 1962. Trade in NZ.’s Favour During 1962 a substantial increase in Japanese exports to New Zealand began to show, mainly because of New Zealand buying of Japanese steel in bulk for the first time, and the balance of trade for the first nine months came out at two to one in New Zealand’s favour, the best ratio Japan has yet obtained in trade with New Zealand. Japanese steel was preferred in New Zealand because a lowering of duties made its price competitive with United Kingdom and Australian steel and because of a reduction in the freight rates between Japan and New Zealand. New Zealand’s imports of Japanese steel increased to 223,000 metric tons worth £1 million in 1962. There was a slight relative drop in Japanese textile exports to New Zealand in 1962 but an increase in machinery, including motor vehicles and parts. Two Japanese motor vehicles, the Datsun “Bluebird” and the “Prince,” are now being assembled in New Zealand.

Timber (pine logs) and wool have continued alongside mutton as New Zealand’s major earners in Japan. According to the Japanese statistics Japan imported £224,247 of New Zealand timber in the January-Sep-tember period of 1962, compared with £154355 for the same period in 1961. The figures for wool were £3,540,000 for 1962 (nine months) and £7,248,000 for 1961. Mutton remained steady with £15,096 in 1962 (nine months), compared with the figure of £15,600 for 1961. Good quantities of natural Cheddar cheese, lactose, casein, powdered milk, tal-

low, sausage casings, hides, and skins have also been sold. The tallow trade is suffering through not being able to export in bulk while the Australians are ahead in cheese by selling simultaneously to processors and retail whereas lew Zealand is tied to pro-

cessors and retails under Japanese brand names only. Some quantities of New Zealand butter from Hamilton have, however, appeared in Tokyo stores a little cheaper than Japanese butter. The stores report supplies very short and erratic but consumer demand heavy. The lowering and stabilising of freight rates is expected to help the trade significantly. A small side trade in timber and livestock (reshaped through Japanese ports) to Korea has developed, together with small outlets in Okinawa and Formosa.

Japanese, besides being the best market in Asia, also ! proved a better customer than Australia, which bought £10.7 million from New Zealand in 1961. , The range of concessions negotiated on Japanese goods at the Geneva meeting will help strengthen Japan’s trading position in New Zealand and it is thought quite likely the trade will come to an even balance within the next few years and may even shift to Japan’s favour within the next decade. The immediate outlook is for a recovery of the 1961 volume during 1963 and a steady but not spectacular development in the future. At the moment the Japanese trade takes approximately 5 per cent of New Zealand’s total exports. The (Japanese) figures for 1960, 1961, 1962 (nine months) are:— JAPAN’S TRADE WITH N.Z. Imports Exports 1960: £11,395,000 £ 8,539,520 1961: £17,960,953 £ 8,055,000 1962:* £10352,300 £ 5,927,080 •Nine months. New Zealand’s total exports for 1961 were valued at £283,679,000. New Zealand’s 1 imports from' Japan in 1961 1 accounted for approximately 2.5 per cent of New Zea- ' land’s total imports of ; £287,000,000. (To be concluded)