Total mass of imports by sea

IBISWorld forecasts the total mass of imports by sea to decline by 3.7% in 2023-24, to 22.60 million metric tonnes. One of the most prominent reasons is the rising global inflation, which has fuelled import prices. While domestic demand has grown, the increased cost of imports has made imported goods less attractive, lowering demand and reducing the volume of imports. The New Zealand dollar is also forecast to depreciate in the current year, making imported consumer goods more expensive and hindering demand for imports.

Over the past two decades, globalisation has put downward pressure on the cost of imports. This was also driven by low global inflation, the removal of trade barriers and the integration of developing economies into a global market system. However, recent geopolitical tension and the corresponding rise in opposition to globalisation in developed nations, coupled with a pandemic-induced push towards economic self-reliance, signalled for an increase in trade barriers. This situation has resulted in more significant restrictions on the flow of goods, affecting international trade globally. The New Zealand dollar has also depreciated over the past five years, driving up the costs of many imported goods. In particular, this trend has placed upward pressure on the price of many consumer goods, such as electrical products, limiting consumer demand. However, New Zealand's limited manufacturing base means many consumers and industry sectors rely on imports to meet demand, as no domestically manufactured substitutes are available. Crude petroleum oil also represents a significant proportion of total New Zealand imports by mass. Although New Zealand has some domestic oil extraction operations in the Taranaki region, a large proportion of local production is exported due to this oil's high quality and value. That's why imports from countries like Singapore, South Korea and Japan account for a significant share of New Zealand's total crude oil requirements. These factors help limit further declines in the total mass of imports by sea. Overall, IBISWorld forecasts the total mass of imports by sea to decrease at a compound annual rate of 1.7% over the five years through 2023-24.