— Adds Details Throughout
— Japan Feb Trade Surplus Y654.11 Bln Vs Surplus 638.28 Bln Yr Ago
— Japan Feb Trade MNI Median Forecast: Y890.4 Bln Surplus, +37.6% Y/Y
— Japan Feb Exports +9.0% Y/Y, Up 15 Months In Row
— Japan Feb Imports +9.9% Y/Y, Up 14 Months In Row
— Japan Feb Exports To US +2.0% Y/Y, Up 14 Months In Row
— Japan Feb Exports To EU +12.7% Y/Y, 1st Rise in 2 Months
— Japan Feb Exports To Asia +12.3% Y/Y, Up 16 Months In Row
— Japan Feb Exports To China +29.1% Y/Y, Up 16 Months In Row

TOKYO (MNI) – Japan’s trade balance returned to surplus in February
on solid exports to Asia, after posting the first deficit in nearly two
years in January due to regional holidays, Ministry of Finance data
released on Thursday showed.

Japan logged a trade surplus of Y654.11 billion last month,
compared with a surplus of Y638.28 billion in the same month a year
earlier.

Japan posted a revised trade deficit of Y475.31 billion in January,
the first deficit since March 2009.

While Japan returned to a trade surplus, economists warned of
growing downside risks to the trade sector due to the March 11
earthquake and tsunami, which has paralyzed production facilities, power
supplies and distribution networks in northeastern Japan.

The government will closely watch the impact of the disaster on
both exports and imports, a MOF official told reporters.

The February figures came in weaker than the median forecast by
economists in a Market News International survey — a rise of 37.6% y/y
to a surplus of Y890.4 billion.

The upturn in February this year was due mainly to accelerated
shipments to China following a slowdown in late January ahead of the
Chinese Lunar New Year holidays on Feb 2-8.

Japanese total exports rose 9.0% in February from a year earlier to
Y5.59 trillion, the 15th straight year-on-year gain. The pace of export
growth picked up from +1.4% in January, which was the lowest rate of
growth since -6.3% marked in November 2009.

Imports gained 9.9% in February to Y4.93 trillion, posting the 14th
consecutive y/y rise following a revised growth of 12.5% in January.

MOF data showed that the average imported crude oil price stood at
$95.9 a barrel in February, the highest since $102.6 marked in October
2008.

Exports to China, the largest market for Japanese goods, rose 29.1%
in February from a year earlier to Y1.16 trillion, which was the largest
amount for the month of February in data series history and was up from
a 0.9% rise in January.

The rise in Chinese February exports was led by metal-working
machinery, power-generating machines and plastic materials.

It was the 16th consecutive y/y rise in total exports but the rate
of increase has slowed from the recent peak of +80.0% in January 2010.

Japan’s shipments to China rose 20.1% to a record high of Y1.285
trillion in December 2010.

In February, Japan’s trade surplus with China hit a record Y243.9
billion.

Elsewhere, exports to the U.S. rose 2.0% from a year earlier to
Y851.8 billion in February, posting the 14th consecutive y/y rise.

The pace of growth decelerated from 6.0% in January and +16.5% in
December. It was well below the recent peak of +50.5% in February 2010.

Shipments of construction machinery, automobiles and non-ferrous
metals led the increase in U.S. exports.

Exports to the European Union gained 12.7% to Y662.7 billion in
February, marking the first y/y rise in two months after dipping 0.7% in
January.

The increase was led by shipments of automobiles, mineral fuels and
auto parts.

Japan’s exports to Asia jumped 12.3% to Y3.11 trillion in February,
marking the 16th consecutive month of y/y gains after rising only 0.4%
in January.

It was slower than +14.8% in December and far below the recent peak
of +68.3% in January 2010.

Higher shipments of iron and steel products, metal-working
machinery and power-generating machines led Japanese exports to Asia.

On a seasonally adjusted basis, Japan’s trade surplus posted a
surplus of Y555.98 billion in February, up 106.8% from the previous
month following a 66.9% m/m fall in January.

Seasonally adjusted exports rose 4.4% in February following a 1.0%
rise in January while imports fell 0.6% after +8.5% in January.

tokyo@marketnews.com
** Market News International Tokyo Newsroom: 81-3-5403-4835 **

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