Australian Bureau of Statistics

Rate the ABS website
ABS Home > Statistics > By Release Date
ABS @ Facebook ABS @ Twitter ABS RSS ABS Email notification service
5368.0 - International Trade in Goods and Services, Australia, Dec 2009  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 03/02/2010   
   Page tools: Print Print Page Print all pages in this productPrint All RSS Feed RSS Bookmark and Share Search this Product

This document was added 02/19/2010.



FEATURE ARTICLE: EXPORT AND IMPORT INVOICE CURRENCIES, DEC 2009


INTRODUCTION

Goods imported into and exported from Australia can be invoiced in a range of currencies. This article analyses the major currencies used in these invoices. Initially the article looks at movement of the Australian dollar against selected currencies covering the period from December 2006 to December 2009. It then looks at the following three dimensions of the data:

  • Compositional changes in the currencies used to invoice goods imported into and exported from Australia for the eight quarters from March quarter 2008 to December quarter 2009;
  • Currencies used to invoice imports into and exports from Australia by selected divisions of the Standard International Trade Classification (SITC) Revision 4 for the calendar year 2009;
  • Historical comparisons of the currencies used to invoice merchandise trade from the 2004 calendar year through to the 2009 calendar year.

Similar analyses appeared in the March quarter 1998, March quarter 2001 and March quarter 2003 issues of the discontinued publication, International Merchandise Trade, Australia (cat. no. 5422.0), as well as in the June 2005 and December 2007 issues of International Trade in Goods and Services, Australia (cat. no. 5368.0).

All values in this article are reported in Australian dollars. The methodology used to measure invoice currencies is described in the appendix.


INVOICE CURRENCY

An invoice currency is the currency in which an invoice for exported or imported goods is denominated. For imports, conversion of a foreign invoice currency value to Australian dollars is undertaken by the Australian Customs and Border Protection Service (Customs and Border Protection). For exports the conversion is undertaken by the Australian Bureau of Statistics (ABS) or the trader. Exchange rates applicable at the time of import or export are used for the conversion.


EXCHANGE RATES

Graph 1 shows movements in the value of the Australian dollar against selected currencies and the movement in the Trade Weighted Index (TWI) from December 2006 to December 2009.

GRAPH 1. MOVEMENTS IN SELECTED EXCHANGE RATES
Graph: GRAPH 1. MOVEMENTS IN SELECTED EXCHANGE RATES


The graph shows that over the period December 2006 to December 2009 the Australian dollar has appreciated against:
  • the United Kingdom pound Sterling (GBP) by 39%
  • the United States dollar (USD) by 15%
  • the New Zealand dollar (NZD) by 11%
  • the Euro (EUR) by 4%.

The Australian dollar depreciated against the Japanese yen by 12% during the same period. There has been an overall rise in the TWI of 8% between December 2006 and December 2009.

However, within the three year period there was some volatility in the value of the Australian dollar, especially during the Global Financial Crisis (GFC). Graph 1 shows three distinct periods of change in the Australian currency:
  • The first period is from December 2006 to June 2008, prior to the GFC, when all invoice currencies were relatively stable.
  • The second period is from June 2008 to November 2008, when the Australian dollar declined significantly against all selected currencies apart from the New Zealand dollar.
  • The last period is from November 2008 to Dec 2009, when the Australian dollar began to recover to levels equal to or higher than before the GFC.

Table 1 further illustrates the movements of the Australian dollar against the selected currencies during the three periods of change.

TABLE 1. MOVEMENTS IN SELECTED EXCHANGE RATES, Percentage change

Dec 2006-Jun 2008
Jun 2008-Nov 2008
Nov 2008-Dec 2009

USD
21.0
-31.0
37.7
GBP
20.9
-11.6
29.8
JPY
10.5
-37.5
27.3
NZD
10.0
-7.1
8.6
EUR
2.8
-15.7
19.8
TWI
13.0
-25.3
28.0



Between December 2006 and June 2008 the Australian dollar appreciated against all the selected currencies, especially the United States dollar and United Kingdom pound Sterling (both 21%). At the early stages of the GFC from June 2008 to November 2008 the Australian dollar depreciated against the same currencies. It depreciated 38% against the Japanese yen and by 31% against the United States dollar. From November 2008 to December 2009 it appreciated against all the selected currencies, especially increasing in value against the United States dollar by 38% and the United Kingdom pound Sterling by 30%. It also appreciated significantly against the Japanese yen and Euro by 27% and 20% respectively.

When the Australian dollar appreciates, Australian exports invoiced in Australian dollars become less attractive to foreign buyers as it takes more of their currency to purchase Australian goods. In contrast, Australian exports invoiced in other currencies provide smaller Australian dollar returns to exporters and decrease the nominal value of Australian exports. From the import perspective, an appreciating Australian dollar makes imports invoiced in other currencies more attractive to domestic consumers as their purchase requires fewer Australian dollars.

For the purpose of Australian import and export statistics, foreign currencies are converted to the Australian dollar using the exchange rate applicable on the day of shipment. However, trading partners may choose a conversion for payment purposes using a different exchange rate or one applying on a different day if favourable conditions exist. In addition, some exporters and importers hedge exchange rates and calculate the value of the transaction using the hedged exchange rate rather than the prevailing exchange rate. For more detail see the further information section.


EXPORT CURRENCIES

Table 2 lists the major currencies used to invoice Australian exports of merchandise goods from March quarter 2008 to December quarter 2009.

Table 2. INVOICE CURRENCIES FOR EXPORTS, Quarterly

Invoice currency
Mar Qtr 2008
Jun Qtr 2008
Sep Qtr 2008
Dec Qtr 2008
Mar Qtr 2009
Jun Qtr 2009
Sep Qtr 2009
Dec Qtr 2009

VALUE ($m)

USD
32 947.0
41 174
49 456
54 217
45 110
37 095
35 897
36 286
AUD
8 183
9 572
9 623
10 980
9 060
8 827
8 926
8 956
EUR
392
399
385
460
574
680
407
407
NZD
349
413
434
393
290
304
346
355
GBP
292
287
316
331
242
269
261
223
JPY
177
214
314
329
259
175
274
206
Other
133
186
220
167
155
165
192
150
Total
42 472
52 244
60 747
66 877
55 690
47 515
46 302
46 584

CONTRIBUTION (%)

USD
77.6
78.8
81.4
81.1
81.0
78.1
77.5
77.9
AUD
19.3
18.3
15.8
16.4
16.3
18.6
19.3
19.2
EUR
0.9
0.8
0.6
0.7
1.0
1.4
0.9
0.9
NZD
0.8
0.8
0.7
0.6
0.5
0.6
0.7
0.8
GBP
0.7
0.5
0.5
0.5
0.4
0.6
0.6
0.5
JPY
0.4
0.4
0.5
0.5
0.5
0.4
0.6
0.4
Other
0.3
0.4
0.4
0.2
0.3
0.3
0.4
0.3
Total
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0



The United States dollar was consistently the currency with the highest proportion of export invoices denominated by value. The proportion of export invoices denominated in United States dollars peaked at 81% in September quarter 2008. Since then the proportion of export invoices denominated in United States dollars has declined to 78% during December quarter 2009, a similar proportion as in March quarter 2008. The Australian dollar as an export invoice currency has seen its share of merchandise exports move inversely to that of the United States dollar, reaching 19% in September and December quarters 2009.

The respective movements of the two invoice currencies (USD and AUD) coincided with the depreciation of the Australian dollar during the early stages of the GFC (September quarter 2008 and December quarter 2008) and subsequent appreciation since March quarter 2009. During the period of the Australian dollar depreciation against the United States dollar the percentage of merchandise exports invoiced in United States dollars increased in comparison with merchandise exports invoiced in Australian dollars. However during the period of the Australian dollar appreciation against the United States dollar the percentage of merchandise exports invoiced in Australian dollars increased in comparison with those invoiced in United States dollars.

During the period shown less than 1% of Australia's merchandise exports were invoiced in each of the Euro (except for March quarter 2009 and June quarter 2009), New Zealand dollar, United Kingdom pound Sterling and Japanese yen.

The other currencies accounted for between 0.2% and 0.4% of Australian merchandise exports over this period. Other currencies include the Canadian dollar, Singapore dollar and Hong Kong dollar.


EXPORT COMMODITIES BY CURRENCY

Table 3 lists the major currencies used to invoice Australian exports by selected SITC Rev 4 divisions (2 digit) for the 2009 calendar year.

TABLE 3. EXPORT INVOICE CURRENCIES FOR SELECTED SITC Rev 4 DIVISIONS (a), Contributions - 2009

Value
USD
AUD
EUR
NZD
GBP
JPY
Other
SITC code description
($m)
(%)
(%)
(%)
(%)
(%)
(%)
(%)

01 Meat and meat preparations
6 640
51.4
43.9
0.8
0.3
1.1
1.7
0.8
02 Dairy products and birds' eggs
2 140
76.3
23.0
-
-
0.4
0.1
-
04 Cereals and cereal preparations
6 482
79.3
15.9
3.6
0.1
-
0.9
0.2
05 Vegetables and fruit
1 694
41.3
54.3
1.6
0.7
0.2
1.5
0.4
11 Beverages
2 461
15.9
59.4
2.6
1.6
15.1
0.5
4.8
26 Textile fibres (excl. wool tops and other combed wool) and their wastes, not manufactured into yarn or fabric
2 427
69.2
28.9
1.7
-
0.3
-
-
28 Metalliferous ores and metal scrap
45 626
95.8
3.9
0.2
-
-
-
-
32 Coal, coke and briquettes
39 345
94.4
5.6
-
-
-
-
-
33 Petroleum, petroleum products and related materials
9 585
85.6
14.4
-
-
-
-
-
34 Gas, natural and manufactured
8 670
76.1
23.9
-
-
-
-
-
54 Medicinal and pharmaceutical products
4 071
11.3
76.2
1.9
4.4
0.7
1.3
4.1
68 Non-ferrous metals
9 355
95.0
4.9
-
-
-
-
-
72 Machinery specialised for particular industries
1 852
26.7
65.5
4.5
0.8
1.2
0.2
1.2
74 General industrial machinery and equipment, n.e.s. and machine parts, n.e.s.
1 765
23.5
69.7
3.7
1.1
1.2
0.1
0.8
78 Road vehicles (incl. air-cushion vehicles)
2 504
59.4
31.9
0.6
6.9
0.2
0.2
0.7
87 Professional, scientific and controlling instruments and apparatus, n.e.s.
2 093
48.5
31.4
12.0
2.8
2.2
1.3
1.9
89 Miscellaneous manufactured articles, n.e.s.
2 086
22.4
55.9
3.0
6.5
9.4
0.7
2.1
93 Special transactions and commodities not classified according to kind
1 944
59.7
35.9
0.7
2.9
0.4
0.4
0.1
97 Gold, non-monetary (excl. gold ores and concentrates)
15 053
99.0
1.0
-
-
-
-
-
Other
30 297
54.4
37.4
3.2
1.9
0.7
1.9
0.5
Total
196 091
78.7
18.2
1.1
0.7
0.5
0.5
0.3

- nil or rounded to zero (including null cells)
(a) Some SITC divisions exclude commodities subject to a confidentiality restriction. These are included in Other.


The eight largest SITC divisions exported during 2009 were primarily invoiced in United States dollars. Of these, the three largest SITC Divisions, metalliferous ores and metal scrap (SITC 28); coal, coke and briquettes (SITC 32); and non-monetary gold (excl. gold ores and concentrates) (SITC 97), had over 90% of their value invoiced in United States dollars.

Six of the 19 largest export SITC Divisions were primarily invoiced in Australian dollars. Of these, the three largest SITC Divisions had 76% of medicinal and pharmaceutical products (SITC 54); 70% of general industrial machinery and equipment, n.e.s., and machine parts, n.e.s. (SITC 74); and 66% of machinery specialized for particular industries (SITC 72).


IMPORT CURRENCIES

Table 4 lists the major currencies used to invoice Australian imports of merchandise goods from March quarter 2008 to December quarter 2009.

Table 4. INVOICE CURRENCIES FOR IMPORTS, Quarterly

Invoice currency
Mar Qtr 2008
Jun Qtr 2008
Sep Qtr 2008
Dec Qtr 2008
Mar Qtr 2009
Jun Qtr 2009
Sep Qtr 2009
Dec Qtr 2009

VALUE ($m)

USD
26 942
28 986
32 504
35 890
27 817
23 894
25 300
26 759
AUD
16 068
17 106
18 093
17 806
15 247
15 741
16 966
18 910
EUR
4 186
4 450
4 844
5 131
4 460
3 828
4 309
4 339
NZD
449
544
566
650
550
581
592
616
GBP
685
673
767
805
619
638
628
549
JPY
1 005
1 086
1 097
1 302
1 078
779
897
921
Other
863
1 061
1 130
1 259
1 247
1 165
1 122
1 048
Total
50 198
53 907
59 000
62 841
51 018
46 626
49 815
53 140

CONTRIBUTION (%)

USD
53.7
53.8
55.1
57.1
54.5
51.2
50.8
50.4
AUD
32.0
31.7
30.7
28.3
29.9
33.8
34.1
35.6
EUR
8.3
8.3
8.2
8.2
8.7
8.2
8.6
8.2
NZD
0.9
1.0
1.0
1.0
1.1
1.2
1.2
1.2
GBP
1.4
1.2
1.3
1.3
1.2
1.4
1.3
1.0
JPY
2.0
2.0
1.9
2.1
2.1
1.7
1.8
1.7
Other
1.7
2.0
1.9
2.0
2.4
2.5
2.3
2.0
Total
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0



Since March quarter 2008 the United States dollar was consistently the currency with the highest proportion of import invoices denominated by value. The proportion of import invoices denominated in United States dollars peaked at 57% in December quarter 2008. Since then the proportion of United States dollars used in import transactions has declined to 50% during December quarter 2009. The proportion of Australian dollars used as an import invoice currency was 36% in December quarter 2009, 8 percentage points higher than a year earlier. As was the case for exports the percentage of merchandise imports invoiced in Australian dollars moved inversely to the percentage invoiced in United States dollar over the period.

The respective movements in the proportions of the two invoice currencies for imports (USD and AUD) coincided with the depreciation of the Australian dollar during the height of the GFC and subsequent appreciation since the crisis abated.

The proportion of merchandise imports invoiced in the Euro was maintained at between 8% and 9%. Other currencies accounted for between 2% and 3% of Australian merchandise imports during the period. Other currencies include the Swiss franc, Singapore dollar, Hong Kong dollar and Papua New Guinea kina.


IMPORT COMMODITIES BY CURRENCY

Table 5 lists the major currencies used to invoice Australian imports by selected SITC Rev 4 Divisions (2 digit) for the 2009 calendar year.

TABLE 5. IMPORT INVOICE CURRENCIES FOR SELECTED SITC Rev 4 DIVISIONS (a), Contributions - 2009

Value
USD
AUD
EUR
NZD
GBP
JPY
Other
SITC code description
($m)
(%)
(%)
(%)
(%)
(%)
(%)
(%)

33 Petroleum, petroleum products and related materials
23 106
99.5
0.4
0.1
-
-
-
-
51 Organic chemicals
3 197
43.5
51.7
3.2
0.1
1.0
0.3
0.2
54 Medicinal and pharmaceutical products
9 375
11.9
81.4
4.4
0.3
0.9
0.1
1.0
62 Rubber manufactures, n.e.s.
2 633
37.5
51.0
6.1
0.3
0.5
3.6
1.0
66 Non-metallic mineral manufactures, n.e.s.
2 633
53.3
23.2
12.3
0.2
0.9
8.2
1.8
67 Iron and steel
3 621
65.9
21.9
7.7
0.2
0.9
2.2
1.1
69 Manufactures of metals, n.e.s.
5 169
52.4
25.3
12.7
1.1
3.5
1.2
3.7
71 Power generating machinery and equipment
4 821
45.8
23.4
17.9
0.3
2.2
4.9
5.5
72 Machinery specialised for particular industries
6 921
34.4
25.0
26.2
1.1
3.3
5.7
4.4
74 General industrial machinery and equipment, n.e.s. and machine parts, n.e.s.
12 111
34.2
36.7
20.7
0.8
1.8
3.2
2.6
75 Office machines and automatic data processing machines
8 528
70.8
22.5
1.6
0.7
0.3
3.4
0.7
76 Telecommunications and sound recording and reproducing apparatus and equipment
11 686
45.5
48.9
2.4
0.2
0.6
1.9
0.5
77 Electrical machinery, apparatus and appliances, n.e.s. and electrical parts thereof (incl. non electrical counterparts, n.e.s. of electrical household type equipment)
9 570
48.2
30.5
14.0
0.6
1.7
2.1
2.8
78 Road vehicles (incl. air-cushion vehicles)
19 970
10.5
76.3
7.3
0.3
0.5
4.6
0.5
82 Furniture and parts thereof; bedding, mattresses, mattress supports, cushions and similar stuffed furnishings
2 632
67.8
17.2
10.6
0.7
0.3
0.3
3.1
84 Articles of apparel and clothing accessories
5 122
65.7
24.3
3.3
0.8
0.5
0.1
5.2
87 Professional, scientific and controlling instruments and apparatus, n.e.s.
4 771
38.9
36.7
14.5
0.9
3.3
1.9
3.8
89 Miscellaneous manufactured articles, n.e.s.
10 522
39.4
43.7
8.4
1.5
2.8
0.9
3.3
97 Gold, non-monetary (excl. gold ores and concentrates)
9 197
86.0
0.1
0.1
5.6
-
-
8.1
Other
45 011
55.4
1.3
0.8
-
0.1
-
0.1
TOTAL
200 598
51.7
33.3
8.4
1.2
1.2
1.8
2.3

- nil or rounded to zero (including null cells)
(a) Some SITC divisions exclude commodities subject to a confidentiality restriction. These are included in Other.


The United States dollar was the currency most used in invoices for the majority of the above SITC divisions. Almost 100% of petroleum, petroleum products and related materials (SITC 33), 86% of gold, non-monetary (excl. gold ores and concentrates) (SITC 97), and 71% of office machines and automatic data processing machines (SITC 75) of imports were invoiced in United States dollars.

For a number of SITC divisions the Australian dollar was the most used import invoice currency. Invoicing in Australian dollars accounted for 81% of medicinal and pharmaceutical products (SITC 54), 76% of road vehicles (incl. air-cushion vehicles) (SITC 78), 52% of organic chemicals (SITC 51) and 51% of rubber manufactures n.e.s. (SITC 62).

The Euro was the third most significant import invoice currency accounting for; 26% of machinery specialised for particular industries (SITC 72), 21% of general industrial machinery and equipment n.e.s. and machine parts n.e.s. (SITC 74), and 18% of power generating machinery and equipment (SITC 71).


RECENT YEARS COMPARISON

Table 6 shows the proportion of exports and imports invoiced in the major currencies in the last six calendar years from 2004 to 2009.

Table 6. INVOICE CURRENCIES FOR EXPORTS AND IMPORTS, Annual

2004
2005
2006
2007
2008
2009
Invoice currency
%
%
%
%
%
%

EXPORTS

USD
69.4
72.6
75.4
75.1
80.0
78.7
AUD
26.2
23.5
21.1
21.3
17.3
18.2
EUR
1.3
1.1
1.0
0.9
0.7
1.1
NZD
1.2
1.1
0.8
1.0
0.7
0.7
GBP
1.0
0.8
0.7
0.8
0.6
0.5
JPY
0.8
0.7
0.7
0.6
0.5
0.5
Other
0.1
0.3
0.3
0.3
0.2
0.3
Total
100.0
100.0
100.0
100.0
100.0
100.0
Total Exports ($m)
117 773
139 079
163 754
168 385
222 341
196 091

IMPORTS

USD
49.8
51.6
52.9
51.3
55.0
51.7
AUD
32.1
31.7
32.1
34.0
30.6
33.3
EUR
9.1
8.9
8.2
8.3
8.2
8.4
NZD
1.3
1.2
1.1
1.0
1.0
1.2
GBP
1.9
1.7
1.4
1.5
1.3
1.2
JPY
2.8
2.6
2.3
2.0
2.0
1.8
Other
3.0
2.4
2.0
1.9
1.9
2.4
Total
100.0
100.0
100.0
100.0
100.0
100.0
Total Imports ($m)
141 247
155 729
176 090
187 874
225 946
200 598



The proportion of merchandise exports invoiced in United States dollars increased from 69% in 2004 to 80% in 2008. The main offset to this general increase from 2004 to 2008 was a general decrease in exports invoiced in Australian dollars from 26% in 2004 to 17% in 2008. The proportion of exports invoiced in other major invoice currencies generally showed a slight downward trend over the period.

The proportion of imports invoiced in United States dollars increased from 50% in 2004 and 55% in 2008 before decreasing to 52% in 2009. The proportion of imports invoiced in Australian dollars peaked in 2007 at 34%. It offset the decrease in United States dollar invoices in 2009 by increasing 2.7 percentage points. The proportion of imports invoiced in each of the other currencies decreased slightly over the six year period.


FURTHER INFORMATION

The commodities represented in tables 3 and 5 are based on SITC Revision 4, whereas commodity details in previous articles were based on SITC Revision 3. The ABS implemented Revision 4 in July 2008 and at the SITC division level, the changes were not significant. See 5368.0.55.010 - Information Paper: Impact of introducing Revision 4 of the Standard International Trade Classification, 2008 for more details.

A feature article, "The Terms of Trade and the National Accounts", released with the December quarter 2004 issue of National Income, Expenditure and Product, Australia (cat. no. 5206.0) discusses, amongst other things, how exchange rates can influence the terms of trade.

For information on the Reserve Bank of Australia's (RBA) methodology of compiling the TWI see the article "Developments in the Trade-Weighted Index" Reserve Bank of Australia Bulletin October 2002. For the updated weights of the TWI see Media Release Number 2009-22, date 30 September 2009 on the RBA website <www.rba.gov.au>.

For more information about hedging activity undertaken by importers and exporters in 2009, refer to Foreign Currency Exposure, Australia, March 2009 (cat. no. 5308.0).


ABBREVIATIONS
$mmillion Australian dollars
ABSAustralian Bureau of Statistics
EUREuro
excl.excluding
GBPUnited Kingdom pound sterling
GFCglobal financial crisis
incl.including
JPYJapanese yen
n.e.s.not elsewhere specified
NZDNew Zealand dollar
SITC Rev 4Standard International Trade Classification Revision 4
TWITrade Weighted Index
USDUnited States dollar

APPENDIX

MEASUREMENT of INVOICE CURRENCIES

Information on the invoice currencies used in export and import transactions is collected by Customs and Border Protection and passed to the ABS with other merchandise trade information required for statistical purposes.

For exports, the ABS converts values reported in foreign currencies to Australian dollars using a representative mid-point of the buy and sell rates on the date of departure of the goods from Australia. The trader may report to Customs and Border Protection in Australian dollars.

For imports, Customs and Border Protection converts values reported in foreign currencies to Australian dollars using exchange rates applicable on the date of departure of the goods from the overseas country. The ABS receives details of the invoice currency together with the value of the import transaction in Australian dollars.

Some factors may complicate the measurement of invoice currencies. In Australian import and export statistics foreign currencies are converted to the Australian dollar using the exchange rate applicable on the day of shipment. Some trading partners may undertake the conversion for payment purposes using a different exchange rate or one applying on a different day. Additionally, some exporters and importers hedge exchange rates and calculate the value of the transaction using the hedged exchange rate rather than the prevailing exchange rate (see further discussion for more details about hedging activity).

For exports prior to October 2004, Customs and Border Protection permitted goods to be invoiced in a relatively small number of currencies. In October 2004, the range of currencies allowed on export documents was increased to 28. As transactions in non-permitted currencies are converted to Australian dollars by the exporter, the increase in the number of permitted currencies may have reduced the proportion of export invoices reported in Australian dollars for December quarter 2004 and following quarters.



Bookmark and Share. Opens in a new window

Commonwealth of Australia 2014

Unless otherwise noted, content on this website is licensed under a Creative Commons Attribution 2.5 Australia Licence together with any terms, conditions and exclusions as set out in the website Copyright notice. For permission to do anything beyond the scope of this licence and copyright terms contact us.