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Indonesia's trade surplus seen narrowing in April: Reuters poll

Reuters - May 13, 2022

Jakarta – Indonesia likely registered a smaller trade surplus in April compared with March, as the value of exports was squeezed by a dip in commodity prices and due to higher imports over the Muslim fasting month of Ramadan, a Reuters poll showed.

The median forecast of 12 economists in the poll was for Southeast Asia's biggest economy to post a $3.25 billion trade surplus in April, down from March's $4.53 billion.

The country has reported monthly trade surpluses since May 2020, driven by rising exports outpacing growth in imports which have been impacted by the pandemic.

The poll predicted April exports grew at an annual pace of 35.97 per cent, down from 44.36 per cent a month earlier. Imports were seen up 34.97 per cent, higher than the 30.85 per cent rise in March.

Josua Pardede, an economist at Bank Permata, said the lower surplus was influenced by a decline in average global commodity prices such as crude palm oil and coal that fell more than 4 per centover the previous month.

"The PMI performance of major trading partners also showed a decline such as China, the Eurozone and the overall global manufacturing PMI index," he said, attributing a lower surplus also to stronger imports of consumer goods that usually increased during Ramadan, which this year started in April.

Radhika Rao, a senior economist at DBS, said she did not expect Indonesia's ban on palm oil exports to materially destabilise the country's trade position.

"The impact of the palm oil ban, which is the key export earner, will be more evident in this month (May)'s numbers," she said, noting the ban was seen as a temporary policy move.

Top palm oil exporter Indonesia has halted exports of the vegetable oil since April 28 to control domestic cooking oil prices. April's trade data will be released on Tuesday.

[Polling by Devayani Sathyan in Bengaluru; Writing by Stefanno Sulaiman; Editing by Ed Davies.]

Source: https://www.channelnewsasia.com/business/indonesias-trade-surplus-seen-narrowing-april-reuters-poll-268348