Australia’s Top Trading Partners

Australia's Top Trading Partners

by Flagpictures.org

Nicknamed the Land Down Under, Australia is an island economy that strongly benefits from its close proximity to the vast markets of China and Japan which together represent 39.9% of all Australian export sales.

During 2015, Australia signed the China-Australia Free Trade Agreement (FTA), which opened tariff-free markets for agricultural, natural resources, energy and manufacturing products and related services. Some experts estimate that the China-Australia FTA will add more than $20 billion in bilateral trade between the two countries.

From a global perspective, Australia shipped US$229.7 billion worth of products worldwide during 2017. That figure represents roughly 1.4% of overall global exports estimated at $15.952 trillion one year earlier during 2016.

Australia’s Top Trading Partners

Top 15

Below is a list showcasing 15 of Australia’s top trading partners, countries that imported the most Australian shipments by dollar value during 2017. Also shown is each import country’s percentage of total Australian exports.

  1. China: US$68 billion (29.6% of total Australian exports)
  2. Japan: $23.6 billion (10.3%)
  3. South Korea: $12.5 billion (5.5%)
  4. India: $10.2 billion (4.4%)
  5. Hong Kong: $9.1 billion (4%)
  6. United States: $8.6 billion (3.8%)
  7. New Zealand: $6.9 billion (3%)
  8. Taiwan: $6.2 billion (2.7%)
  9. Indonesia: $4.9 billion (2.1%)
  10. United Kingdom: $4.6 billion (2%)
  11. Singapore: $3.6 billion (1.6%)
  12. Vietnam: $3.5 billion (1.5%)
  13. Malaysia: $3.5 billion (1.5%)
  14. Thailand: $3.1 billion (1.3%)
  15. Netherlands: $1.8 billion (0.8%)

About three-quarters (74%) of Australian exports in 2017 were delivered to the above 15 trade partners.

Leading export increases was India up 28.5% from 2016 to 2017, followed by Hong Kong (up 26.9%), Vietnam (up 24.7%), Indonesia (up 23.6%) and Taiwan (up 17.4%).

Leading the decliners was the United Kingdom which cut back its imports from Australia by -39.3%.

Similarly, Aussie exports to Singapore dropped by -11.6% trailed by Japan’s -10.5% reduction.

Deficits

As defined by Investopedia, a country whose total value of all imported goods is higher than its value of all exports is said to have a negative trade balance or deficit.

It would be unrealistic for any exporting nation to expect across-the-board positive trade balances with all its importing partners. Similarly, that export country doesn’t necessarily post a negative trade balance with each individual partner with which it exchanges exports and imports.

Australia incurred the highest trade deficits with the following countries:

  1. United States: -US$14.1 billion (country-specific trade deficit in 2017)
  2. Germany: -$8.6 billion
  3. Thailand: -$7.7 billion
  4. Malaysia: -$5 billion
  5. Italy: -$4.2 billion
  6. South Korea: -$3.2 billion
  7. France: -$2.7 billion
  8. Singapore: -$2.5 billion
  9. Mexico: -$2 billion
  10. Sweden: -$1.5 billion

Among Australia’s trading partners that cause the greatest negative trade balances, Australian deficits with Singapore (up 129.5%), Malaysia (up 46.9%) and Mexico (up 31.8%) grew at the fastest pace from 2016 to 2017. Australia’s largest trade deficit in 2017 was with the United States, up by 8.6% from -$12.9 billion for 2016.

These cashflow deficiencies clearly indicate Australia’s competitive disadvantages with the above countries, but also represent key opportunities for Australia to develop country-specific strategies to strengthen its overall position in international trade.

Surpluses

Based on Investopedia’s definition of net importer, a country whose total value of all imported goods is lower than its value of all exports is said to have a positive trade balance or surplus.

Australia incurred the highest trade surpluses with the following countries:

  1. China: US$19.6 billion (country-specific trade surplus in 2017)
  2. Hong Kong: $8.6 billion
  3. Japan: $7.6 billion
  4. India: $6.3 billion
  5. Taiwan: $3.3 billion
  6. Indonesia: $1.8 billion
  7. Philippines: $1.2 billion
  8. New Zealand: $1 billion
  9. Turkey: $516.1 million
  10. Saudi Arabia: $509.3 million

Among Australia’s trading partners that generate the greatest positive trade balances, Australian surpluses with Indonesia (reversing a -$1.5 billion deficit), Taiwan (up 64.3%) and Philippines (up 44.9%) grew at the fastest pace from 2016 to 2017.

These positive cashflow streams clearly indicate Australia’s competitive advantages with the above countries, but also represent key opportunities for Australia to develop country-specific strategies to optimize its overall position in international trade.

Companies

Companies Servicing Australian Trading Partners

Thirty-six Australian corporations rank among Forbes Global 2000. Below is a selected sample of the major Aussie companies that Forbes included:

  • BHP Billiton (diversified metals)
  • Fortescue Metals Group (iron, steel)
  • Woodside Petroleum (oil, gas)
  • Amcor (containers, packaging)
  • Santos (oil, gas)
  • Caltex Australia (oil, gas)
  • Orica (diversified metals)
  • Newcrest Mining (diversified metals)

According to IMPORTERS.com listings for Australian suppliers, the following are examples of companies that ship products from Australia to its trading partners around the globe. Shown within parenthesis are products that the Australian business provides.

  • Bullys Beef Pty Ltd (beef)
  • Cotton Tree Trading Pty Ltd (dairy products)
  • Harts Food And Beverages PL (coconut water)
  • Logreen Pty Ltd (food additives, vanilla beans)
  • Metabolic Food Company (breakfast cereal blends)
  • Platinum Direct (premium wines)
  • Rasile Global Importers P/L (food, beverages)
  • Scorex (meat, poultry)
  • Sunnyfresh Grapes Australia (grapes)
  • Waverley Australia Pty Ltd (blankets, rugs, quilts)


 
See also Australia’s Top 10 Imports, Australia’s Top 10 Exports and Australia’s Top 10 Major Export Companies

Research Sources:
The World Factbook, Field Listing: Imports – Commodities, Central Intelligence Agency. Accessed on February 8, 2018

Trade Map, International Trade Centre, www.intracen.org/marketanalysis. Accessed on May 11, 2018

Investopedia, Net Importer Definition. Accessed on February 12, 2016

Forbes 2015 Global 2000 rankings, The World’s Biggest Public Companies. Accessed on February 8, 2018

IMPORTERS.com The Online Market for G20 Importers, Australia Import Export Directory. Accessed on November 22, 2015