Ireland recorded its lowest seasonally adjusted trade surplus since July 2008 in March, according to new figures from the Central Statistics Office (CSO).

The data show seasonally adjusted exports declined by €256 million or four per cent to €6.9 billion from February to March. Coupled with an increase in seasonally adjusted imports of €476 million, or 12 per cent to €4.5 billion, the trade surplus decreased by 23 per cent to €2.3 billion.

The value of exports decreased by €524 million or 6 per cent to €7.56 billion in March 2014 versus the same month a year earlier. The decline was attributed to a 16 per cent fall in exports of organic chemicals and a 10 per cent fall in exports of medical and pharmaceutical products.

The EU accounted for €4.2 billion, or 56 per cent of total exports in March 2014. The US was the main non-EU destination accounting for €1.8 billion or 24 per cent of exports.

The value of imports rose by €674 million or 16 per cent to €4.8 billion in March 2014 versus the same month a year earlier. Imports of organic chemicals rose by 176 per cent or €339 million, while imports of machinery and transport equipment increased by 26 per cent or €258 million.

The EU accounted for 62 per cent of the value of imports in March, with 29 per cent coming from Britain. The US and Switzerland were the main non-EU sources of imports.

“All in all, while the compression in the trade surplus during the first quarter is clearly unwelcome, there are some indications that suggest it’s not all bad news,” said Investec chief economist Philip O’Sullivan.

“The largest export sector (chemicals and related products) looks like it is beginning to stabilise after a harrowing 2013, while other export groups should benefit from the well-documented recovery underway across Ireland’s key trading partners. On the import side, the buoyancy here chimes with a host of signals which point to the domestic economy having made a meaningful return to growth,”

Elsewhere, Alan McQuaid of Merrion Capital said while the March figures were disappointing, a recovery in export performance, with a volume increase in goods and services, is expected this year.

Conal Mac Coille from Davy said the underlying picture emerging is that the export sector is slowly recovering, with a diminishing drag from pharmaceuticals. He said the sector is also benefitting from the emergence of the euro area from recession and on-going recovery in the UK.