The Australia-NZ travel bubble: First numbers
Provisional overseas arrivals & departures

• Overseas travel: Provisional data shows there were 54,800 arrivals into Australia in April, up 66.6 per cent over March. There were 65,100 departures, a doubling (100.9 per cent) over March.

• Travel sector: The outlook for the travel & leisure sector of the Australian sharemarket is generally positive but much depends on the speed of the rollout of vaccines and containment of virus case numbers.

• Agriculture data: The Australian Bureau of Statistics released three publications on the Agriculture sector today. These are “Agricultural Commodities (2019/20); Value of Agricultural Commodities Produced (2019/20); Water Use on Australian Farms (2019/20).

Tourism data is important for airlines, hotels, shops and transport operators.

What does it all mean?

• In March, there were 65,000 travel movements in or out of the country. In April, this total lifted to almost 120,000. Now these numbers are nowhere near the 3.5 million movements in a more ‘normal’ April month such as 2019, but it’s a start. The increase reflects the start of the Australia-NZ travel bubble on April 18.

• The re-opening of foreign borders is the pathway to greater ’normality’ – whatever that will be. But ‘normality’ is still some way away – the general assumption being that it will be another year at least before borders can start re-opening in a more meaningful way.

• That means challenges still lie ahead for tourism, education, agriculture and the industries that are most dependent on foreign labour due to shortages of people with specific skills.

• The data on the agriculture sector today represents a good stocktake on the sector. But much has changed across the sector over the past 11 months, such as alleviating of drought conditions in many parts of the country.

What do you need to know?

Provisional overseas travel – April 2021

Arrivals:

• In original terms, there were 54,800 estimated arrivals in April, a 66.6 per cent increase compared to the previous month and a 153.5 per cent increase compared to the corresponding month of the previous year.

• There were 19,600 Australian citizens arrivals (36 per cent of the total), 7,100 permanent visa holders (13 per cent), 20,300 New Zealand citizens (37 per cent) and 8,100 temporary visa holders (15 per cent).

• Of the visa groups there were 2,690 on Permanent Skilled Visas (up 11.7 per cent on March) with 1,550 Temporary skilled visas (down 10.6 per cent) and 150 on Temporary work visas (down 7.5 per cent)

Departures:

• In original terms, there were 65,100 estimated departures in April, a 100.9 per cent increase compared to the previous month and a 2.4 per cent increase compared to the corresponding month of the previous year.

• There were 24,000 Australian citizens departures (37 per cent of the total), 5,000 permanent visa holders (8 per cent), 23,900 New Zealand citizens (37 per cent) and 13,400 temporary visa holders (21 per cent).

• Of the visa groups there were 1,970 on Permanent Skilled Visas (up 51.4 per cent on March) with 1,090 Temporary skilled visas (down 8.2 per cent) and 470 on Temporary work visas (down 18.8 per cent).

Agricultural Commodities 2019/20

The ABS reported that in June 2020 there were:

• 377 million hectares of agricultural land, down 2 per cent from 2018-19;

• 87,800 agricultural businesses, down 2 per cent;

• 61 million tonnes of cereal and broadacre crops produced, down 8 per cent;

• 64 million sheep and lambs on farms at 30 June 2020, down 3 per cent;

• 21 million beef cattle at 30 June 2020, down 6 per cent.

What is the importance of the economic data?

• The Australian Bureau of Statistics releases data on overseas arrivals and departures, produced monthly and is an indicator of the health of the tourism sector. Preliminary monthly data has been issued in the Covid-19 period. The figures are also useful in understanding spending trends and tracking migrant numbers – an indicator with widespread implications for employment, housing and spending.

What are the implications for investors?

• The section of the tourism sector that is most dependent on foreign tourists will continue to experience tough operating conditions for some time. Further assistance by government may be necessary to ensure survival.

• The outlook for the travel & leisure sector of the Australian sharemarket is generally positive but much depends on the speed of the rollout of vaccines and containment of virus case numbers.

Published by Craig James, Chief Economist, CommSec