California Exports Slip Again, But Faring Better Than US Overall

November 4, 2015 –

The value of California’s merchandise export trade contracted slightly in September from the same month last year, according to Beacon Economics’ analysis of foreign trade data released this morning by the U.S. Commerce Department.
The state’s exports of goods to foreign markets in September totaled $14.13 billion, down 2.2% from the $14.45 billion recorded in September 2014. By way of comparison, overall U.S. merchandise exports fell by 6% over the same period, while exports from Texas shrank by 13.7%.
California’s exports of manufactured goods in September edged down by 1.4% to $9.12 billion from $9.25 billion last year. Exports of non-manufactured goods (chiefly agricultural produce and raw materials) dropped by 6.7% to $1.65 billion from $1.77 billion the previous September. Re-exports meanwhile were off by 1.8% to $3.36 billion from $3.43 billion.
“All things considered, the September numbers weren’t too shabby,” said Jock O’Connell, Beacon Economics’ International Trade Adviser. “The environment these days for foreign trade is pretty grim. As Governor Brown might say, a 2.2% drop in exports could be regarded as a psychic victory.”
Still, California’s export trade so far this year is lagging behind last year’s pace by 3.1%.
A Closer Look At The Numbers
As always, Beacon Economics cautions against reading too much into month-to-month fluctuations in state export statistics, especially when focusing on specific commodities or destinations. Significant variations may occur as the result of unusual developments or exceptional one-off trades and may not be indicative of underlying trends. For that reason, Beacon Economics compares the latest three months for which data are available (i.e., July – September) with the corresponding period one year earlier.
California’s merchandise exports during this year’s third quarter totaled $41.17 billion, a nominal decline of 3.8% from the $42.80 billion recorded during the same period last year. Nonetheless, the state accounted for 11.3% of total U.S. merchandise exports in the latest three months.
California’s export trade is highly diversified. Eleven major categories of goods each accounted for at least $1 billion in exports in the latest quarter. Performance, however, varied, with only four categories recording year-over-year gains. On the plus side, Non-Electrical Machinery exports gained 7.3%, going from $3.55 billion to $3.80 billion. Agricultural exports rose marginally by 0.2% from $2.88 billion to $2.89 billion. Exports of Fabricated Metal Products rose by 2.2% from $1.03 billion to $1.05 billion. Exports from the Primary Metal Manufacturing industries saw a 90.2% leap from $.75 billion to $1.42 billion.
On the downside, exports of Computer & Electronic Products dropped by 1.4% from $11.03 billion to $10.88 billion. Transportation Equipment exports fell 13.5% from $4.93 billion to $4.26 billion. Exports of Miscellaneous Manufactured Commodities (a catchall category of merchandise ranging from medical equipment to sporting goods) were down 3.6% from $3.43 billion to $3.31 billion. Chemical exports sagged 5.2%, dropping from $3.64 billion to $3.45 billion. Food and Kindred Products exports continued to drift lower, down 9% from $2.45 billion to $2.23 billion. Electrical Equipment exports were off by 3.4% from $1.75 billion to $1.70 billion. Petroleum and Coal Products exports plummeted 32.9% from $1.54 billion to $1.04 billion. Waste & Scrap exports were off 21.6% from $1.13 billion to $0.88 billion.
Mexico continued to rank as California’s single largest export destination during the latest three-month period but with the value of exports nudging up only 0.7% from $6.42 billion to $6.47 billion. Exports to Canada fell by 10.5% from $4.74 billion to $4.24 billion, while shipments to China declined by 4.1% from $4.04 billion to $3.87 billion. Exports to Japan also edged lower by 2.9% from $2.91 billion to $2.83 billion. Shipments to Hong Kong jumped 26.9% from $2.21 billion to $2.80 billion. As a result, Hong Kong knocked South Korea (+1.7% from $1.92 billion to $1.95 billion) from its customary place among California’s Top Five export destinations.