Tourism boom continues as departures exceed 10 million in 12 months for first time

In the past 12 months more than 10 million Aussies have travelled abroad for the first time ever. New data for May from the ABS shows that, over the past 12 months, 10,019,900 short-term departures have been made from the country; a new record. Departures are up 7.6% from a year ago and up 4.3% for the 12 month period.

Arrivals are growing even more strongly. For the month pf May arrivals were 7.9% higher than a year ago and they are up 9.9% for the total over the 12 month period. China continues to show solid growth with arrivals up 9.1% from last May and 11% higher for the 12 month period. More than 1.25 million arrivals from China were recorded in the past 12 months; another new record high.

Significant revisions muddy the data but Domestic Tourism numbers not looking good for TNQ

As we have been expecting for some time, today saw the release of some major revisions to domestic tourism numbers for TNQ. Tourism Research Australia have released the National Visitor Survey report for the March 2017 quarter (available here) along with revisions to data going back to the 2014 year (see here for details). The main point of the revisions is a roughly 15% decline in the original estimate of overnight trips to TNQ in 2015. While details of the revisions are sketchy at this stage (TRA are only providing data for year end, and March 2016, rather than individual quarters) it is clear that they remove much of the increases previously reported for TNQ which many (ourselves included) had queried at the time.

Despite a degree of uncertainty about the revisions this new data clearly confirms the ongoing slide in domestic tourism to the Far North.

Australia saw an increase of overnight trips of 3.1% for the year to March 2017; Queensland was up 4.3%. In TNQ however we saw a 6.9% decline in visits and a 8.4% reduction in expenditure over the year.

Even with international tourism expenditure having increased over the year, the drop in domestic expenditure sees the total for the region fall 4.9% since March 2016.

Given the support that the tourism recovery has given to the TNQ economy it will be worrying many to see this degree of a slow-down seemingly now confirmed. There had been hope within the tourism sector that the long-awaited revisions from TRA would confirm that growth remained in place (albeit at a slower pace than originally estimated); that hope appears now to have been misplaced.

International Tourism arrivals continue to grow but China is slowing

The ABS Short Term Arrivals and Departures data for April shows arrivals up 10.1% from a year ago to a total for the 12 months of almost 8.5 million.

However, the crucial Chinese market (which accounts for 14.7% of all arrivals) has seen growth slow significantly. Trend growth in Chinese arrivals is up just 7.6% from a year ago; this is the slowest pace of Trend growth since Feb 2010. While a slowing pace of growth is to expected as the actual level of Chinese arrivals increase, the pace of this slowdown appears to be indicating a more potentially disturbing reality. Just over a year ago Chinese arrivals were growing at almost 30% a year. That pace of growth has been slowing rapidly since the start of 2016 and has now reached 7 year lows.

Departures are also up, although at a much slower pace than departures. Short term departures are up 4% from a year ago. The difference in the pace of growth of arrivals and departures has seen the annual gap between the number leaving and those arriving over the past 12 months fall to a 6 year low of just less than 1.5 million.

Domestic visitor numbers will be updated by way of the National Visitor Survey for the March quarter from Tourism Research Australia next Wednesday.

Pete talking TNQ tourism numbers on ABC Far North & 4CA

Kier Shorey at ABC Far North, and John MacKenzie from 4CA, both spoke to Pete this morning about yesterday’s International Visitor Survey and what it held for TNQ. You can listen below, and read yesterday’s analysis on the IVS here.

Yesterday also saw the GDP release and, as usual, this coincided with the release of our quarterly regional economic roundup in The CONUS Quarterly. You can download your own copy of that full report here….CONUS Quarterly June 2017

ABC Far North

4CA

International tourism grows but QLD and TNQ are both falling behind

Today’s release by TRA of the International Visitor Survey for March 2017 (available here) shows international visitors up by 9.2% y/y with expenditure up 8.1%.

Numbers to Queensland were also up strongly (+6.8%), although expenditure rose just 2.6% y/y. However, as a result the Sunshine State’s share of the international visitor market has fallen to an all-time low of just 33.4%.

In Tropical North Queensland things were somewhat better with visitors up 7.2%, although expenditure managed to drop by 0.8% on the back of significantly lower average regional expenditure per visit (down from $1,310 a year ago to just $1,212 now). TNQ also saw its share of the international market drop top 11.5%. Growth in key areas such as China and the US have slowed while Japan and the UK remained static.

Short-term arrivals top 8.4 million for 12 months to March

Seasonally adjusted short-term arrivals have broken through the 8.4 million mark for the previous 12 months for the first time. Annual growth has exceeded 10% for each of the past 9 months, with it sitting at 10.3% in March. China remains a major growth factor with arrivals up 12.9% annually; although this is the slowest pace of growth for the sector since Sept 2014. Annual arrivals from China are edging closer to 1.25 million for the 12 months to March (1.24 million).

Short-term departures actually fell from a year ago (-4.0%), the first dip in almost 2 years, and are up just 3.6% for the 12 months to March.

Data from the Tourism Research Australia International and National Visitor Surveys are due for release in the first and third weeks of June.

Domestic tourism continues to dive in TNQ

Tourism Research Australia’s National Visitor Survey for the December quarter (available here) does not make happy reading for the industry in the Far North. While total overnight domestic visitors in Australia rose by 4.2% from the previous year, and were up by 3.4% in Queensland, the TNQ region saw a decline of 11.3%. Overnight domestic visitors to the region fell to 1.9 million for the year to end Dec 2016 from 2.14 million the previous year.

Last quarter we posed the question “is the domestic tourism boom in the Far North coming to an end?” (see here) and concluded that it was probably too early to say. We wanted to see more data. Well, that data’s now in and it doesn’t look good.

Expenditure from domestic overnight visitors to TNQ has fallen by 15.5% from the previous year; this equates to almost $400 million less being spent in the region. Day visits have never played a large part in the TNQ story, but here too we see weakness (down 0.4%) in the face of stronger national and Queensland numbers (both up about 5.5%). Combining both overnight and day visits we see expenditure in TNQ down by 14.4% over the year.

As the chart below makes clear, the solid growth in international visitors (which continues unabated…see here from a fortnight ago) is not enough to make up for the large decline in the (much larger) domestic market. Total visitor expenditure in the region for the 2016 year fell 7.5% from 2015.

The reasons for such a decline over the past three quarters is not yet clear, but anecdotal evidence suggests that the heavily negative media regarding the bleaching event on the northern GBR last year (unfortunately being repeated again this year in the tourist hot-spots further south) may be deterring Aussies from making the trip to the north. Clearly TTNQ, and its soon-to-be-appointed new CEO, will be keen to reverse this worrying slide.

UPDATE. TTNQ have cast doubt on the data (see here) and TRA accept that the data from 2014 and 2015 could have over-stated the position for TNQ. If that is the case then the stellar results in past quarters (that TTNQ were happy to agree with) could have been an illusion…we shall have to see what TRA decide once they’ve completed their work on the data. Good coverage on this issue fro Mark Beath at Cairns Economy…see here.

China helps TNQ beat the international visitor pack

The Tourism Research Australia International Visitor Survey for the quarter to Dec 2016 (available here) shows international visitor numbers continuing to improve; although visitors are staying for less time.

Total visitors for the year hit a new record high of 7.625 million; an increase of 11.2% from the previous year. Expenditures rose by 8.1% to $26.2 bn which saw the average expenditure per night fall by 2.8% while the average length of stay dropped by 8.5%.

Queensland fared not quite as well with total visitors up 10.1%, expenditure up 4.0% and average expenditure per visit falling by 5.6%.

Tropical North Queensland, lead by the surge in Chinese visitors, was a stand-out performer. Total visitor numbers were up 15.4% to 901,000. Despite expenditure rising strongly (up 10.2% to $1.12 bn) the average spend per visit fell 4.5%. As a result TNQ’s share of the international visitor market has started to climb back from the lows seen in 2012, although there’s still a very long way to go to return to the heady days of a decade ago when 17% of all international visitors were coming to the Far North.

But make no mistake, the solid TNQ performance isn’t all down to China. While China saw a huge 32.1% gain in total visitors to the region (to 229,000) Japan also experienced very good growth (up 21.2%) , as did the US (up 14.6%). As we can see from the chart below, the US and Japan have now pulled well clear of the pack behind China.

The tourism picture for 2016 will be completed in a fortnight’s time when we see TRA’s National Visitor Survey released.

 

Arrivals and Departures data powers ahead

The ABS released their short term arrivals and departures data for January this morning and it confirms the ongoing strength for the tourism sector.

Arrivals in Jan hit  a new record high (seasonally adjusted) of 716,700 for the month which is an increase of 8.7% from the same time a year ago. Over the past 12 months total arrivals exceeded 8.3 million (also a new high) and are up 10.3% from a year ago. China continues to be an important component of these arrivals and were at 111,500 in Jan (+10.5% y/y) for a 12 month total of 1.22 million (up 11.6% y/y). Chinese arrivals have been hovering just below 15% of all arrivals over the course of the year for the past 8 months now.

Departures are also still growing and stood at 851,900 in Jan (up 3.9% from a year ago). Over the 12 months departures were at 9.9 million (another new high) which is an increase of 4.2% for the year.