California’s merchandise export trade posted solid year-over-year gains in August, according to a recent trade report by Beacon Economics.
According to a Beacon Economics analysis of U.S. trade statistics released by the U.S. Census Bureau, the nominal value of shipments by California businesses to foreign destinations totaled $14.12 billion for the month, 6.7% above the $13.24 billion recorded in same month last year.
The state’s exports of manufactured goods in August rose by 2.9%, to $8.91 billion from $8.66 billion one year earlier. Exports of non-manufactured goods (chiefly agricultural products and raw materials) also increased, rising by 2.5%, to $1.52 billion from $1.48 billion the previous August. Re-exports, meanwhile, jumped by 19.3%, to $3.69 billion from $3.09 billion.
By way of comparison, the nominal value of overall U.S. merchandise exports in August slipped by 0.2%, while exports from Texas fell 5.7%, the report found.
The U.S. Department of Commerce has determined that California was the state-of-destination for 18.7% of all U.S. merchandise imports in August, with a value of $36.34 billion, up 1.4 % from the $35.84 billion in imported goods in August 2015. Manufactured imports totaled $33.25 billion, an increase of 1.8% from $32.67 billion last year. Non-manufactured imports in August were valued at $3.09 billion, down 2.4% from $3.17 billion a year ago.
Looking Closer at the Numbers
California’s merchandise exports during the latest three-month period totaled $42.28 billion, a nominal gain of 0.3% from the $42.14 billion recorded during the same period last year, the report finds.
On the plus side, exports of Computer & Electronic Products (computers and peripherals; communication, audio, and video equipment; navigational controls; and electro-medical instruments) increased by 3.1% to $11.12 billion from $10.78 billion. Exports of Miscellaneous Manufactured Commodities (a catchall category of merchandise ranging from medical equipment to sporting goods) saw a 4.0% increase to $4.28 from $4.11 billion.
On the down side, the state’s exports of Transportation Equipment (automobiles, trucks, trains, boats, airplanes, and their parts) fell by 4.0% to $4.34 billion from $4.52 billion. Non-Electrical Machinery (machinery for industrial, agricultural and construction uses as well as ventilation, heating, and air conditioning equipment) exports dropped 7.8% to $3.71 billion from $4.03 billion.
Chemical exports (including pesticides and fertilizers; pharmaceutical products; paints and adhesives; soap and cleaning products; and raw plastics, resins, and rubber) edged lower by 0.8% to $3.36 billion from $3.39 billion.
Mexico continued to rank as California’s single largest export destination during the latest three-month period, according to the report. However, the value of the state’s shipments south of the border slipped to $6.48 billion from $6.68 billion. Exports to Canada fell somewhat more, dropping 3.7 to $4.15 billion from $4.31 billion, while shipments to China were off by 5.6% to $3.69 billion from $3.91 billion. Exports to Japan strengthened, rising by 3.9% to $2.97 billion from $2.86 billion.
According to the report, behind the nominal statistics, California’s export trade has been growing stronger through most of 2016. Whether that trend persists is open to discussion. There is an emerging consensus, fed in part by a glum forecast issued late last month by the Organization for Economic Cooperation and Development indicating that international trade will see, at best, modest growth over the next year, and by a more recent forecast of slower growth in the developed world issued by the IMF.
By contrast, California’s exports to the European Union rose by a healthy 8.0% to $7.67 billion from $7.10 billion, propelled largely by a 15.7% surge in the value of shipments to the United Kingdom, Brexit and the subsequent drop in the value of the pound notwithstanding.
The analysis finds that in the short run, the good news is that despite a generally gloomy picture abroad and a strong dollar, California exporters have been doing remarkably well.