China last month cemented itself as New Zealand's major export market, figures released yesterday show.
For the year to January 2014, China accounted for $10.5 billion, or more than 20%, of New Zealand exports.
Statistics New Zealand figures showed the value of annual exports to China was up 54% from a year earlier.
China accounted for more than double second-place Australia's exports in January. China's export share was now comfortably ahead of Australia's, ASB economist Nathan Penny said.
The increased trade with China and dairy exports led to New Zealand's first annual trade surplus since March 2012.
''With demand for New Zealand commodities extending its amazing run well into 2014, we expect a good run of trade surpluses to continue.''
Imports had a weaker quarter, put down to temporary factors such as petroleum and products being down 36% in the month, he said.
''We expect imports to pick up as economic growth accelerates through the year and the Christchurch rebuild, in particular, further ramps up. In a sign of things to come, machinery and plant imports were up over 8% to January compared to the three months prior.''
Dairy farm incomes would be flush this season, Mr Penny said.
Fonterra announced yesterday demand had allowed the co-operative to lift the farm-gate milk price by 35 cents to $8.65 per kg of milk solids.
Mr Penny said world dairy prices had continued to trade at their near record levels.
''Extremely strong demand, particularly from China, has underpinned prices.
"Whole milk powder prices for example have hovered around $US5000 [$NZ6020] per tonne, a level unheard of until April 2013, for the best part of a year.''
China's demand for dairy had been almost insatiable, he said.
The United States Department of Agriculture, for example, projected China's share of whole milk powder (WMP) imports among the major importing countries would be 61% in 2014, up from 29% five years earlier.
The data released yesterday captured an ongoing trade trend rather than fresh news, he said.
