SYDNEY, Feb. 2 (Xinhua) -- Australia's trade surplus surged to a record high in December, according to figures released Thursday by the Australian Bureau of Statistics.
The trade surplus of 3.5 billion (Australian dollars) is the largest on record, only the second largest in the past three years, and comes after the record trade deficit of 4.4 billion (Australian dollars) a year ago.
Experts had speculated the economy had begun to shrink into a recession, but Thursday's strong figures in trade were enough to counteract other figures that showed a weakening in dwelling investment in Australia, with building approvals down 1.2 percent in December to 18 percent lower than their peak in June.
The rising surplus was driven by increased commodity prices, with a surge of 14 percent, or 705 million (Australian dollars) in coal exports to 5.8 billion (Australian dollars), while iron ore also shot up a further 10 percent for the period.
Paul Dales, chief economist at Capital Economics, told Xinhua, the lift in the Reserve Bank of Australia's commodity price index in January, means it is possible that the trade surplus may continue to increase over the next coming months.
However, Dales says these conditions may not last, citing two key factors that are set to have a detrimental impact on Australia's trade surplus later in the year.
"We are expecting the price of iron ore and coal to fall back, so that would reduce the size of the trade surplus later this year," Dales said.
Dales also had concerns of the strengthening of the Australian dollar playing a role in inhibiting Australia's trade growth.
"Over time, with a reasonable lag, changes in the dollar tend to reduce the volume of exports and increase the volume of imports, we do know that the Australian dollar strengthened fairly sharply last year, so there could be a drag from that as well coming through sometime over the next six months," Dales said.
The Australian dollar experienced its own boost on the back of the trade surplus figures, forging ahead to 76.42 U.S. cents at 1428 local time AEDT, from its Asian market open of 75.86 U.S. cents on Thursday.
Top 04 Facts You Need to Know About Agribusiness Loans in Australia
Agribusiness loans are available to Australian farmers who need funds for seeding funds, reinvestment, or a means to start running their farm. These are loans that are repaid with the interest and principal for an extended period of time. There are different lending options available to farmers, and knowing these facts may help you decide which the best loan is for you:
1. Agribusiness loans are flexible – Providers take time to understand the needs of most farmers to create packages that will allow their clients to save money in the long run. Certain packages, like bundle lending products, may help you save on service fees.
2. They can be structured on different lending facilities – Apart from the regular agribusiness loans, lending facilities can include agri lines of credit, overdrafts, and equipment finance. Overdrafts are working capital facilities that can be scaled up or down as needed, making them appropriate if your farm’s cash flow tends to fluctuate.
3. Agri lines of credit and equipment finance - Agri lines of credit are interest-only loans that have a fixed limit, but can be redrawn and repaid freely. So, they are useful when your farming operations gain income in lump sums every season. Equipment finance is the asset-based finance that is separate your main banking facilities to be replaced with other lenders. This way, you can use it for large pieces of equipment, farm vehicles, and other assets.
4. You can learn more about agribusiness loans by speaking with a financial advisor – Look for a reputable and seasoned professional who understands the needs of farmers. If possible, choose someone who comes from a family of farmers and with genuine interest in the business, too. That way, you can be confident in the advice that they can provide for you. The best financial advisors are connected with leading lenders and banks in Australia to help you find the right loan that suits your needs.
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