US Chems, Other Exports Off in Jan - but Signs of Hope
WASHINGTON (ICIS news)--The US trade deficit in chemicals and the broader trade balance fell in January, and while more negative numbers lie ahead for this year, hopeful signs are beginning to appear, a top chemicals economist said on Friday.
The Department of Commerce (DOC) said that the overall US trade deficit declined in January to $36bn (€28bn) as US exports and imports both fell, reflecting the global recession.
US exports of goods and services in January totalled $124.9bn against imports of $160.9bn.
January’s deficit of $36bn marked a nearly 10% decline from December’s revised trade deficit of $39.9bn.
In chemicals, the US trade deficit fell more sharply, off by more than 60%.
Kevin Swift, chief economist at the American Chemistry Council (ACC), noted that US exports of chemicals in January fell marginally to $10.743bn compared with revised December exports of $10.753bn, a difference of only $10m.
“Not much change there, and that is sort of encouraging,” Swift said.
That slim decline in exports is slightly encouraging because US chemical imports in January fell significantly, down to $11.748bn compared with December imports of $13.783bn, a difference of just more than $2bn and a decline of 15%.
“So we went from a chemicals trade deficit of $3bn in December to a deficit of roughly $1bn in January,” Swift noted.
However, while the lower $1bn deficit is a relative improvement compared with December, January’s deficit compares unfavourably with the $64m chemicals trade surplus seen in January 2008, he said.
And, with both export and import volumes still trending down - US overall exports were above $160bn monthly in mid-2008 - the reduced trade deficit is a slim silver lining.
“These numbers I think reflect a collapse in international trade and the synchronised global recession, which are affecting US exports of chemicals” Swift said. “The EU is in recession, Japan is in a deep recession, our trading partners in Canada and Mexico are in decline and emerging markets are also in recession.”
On the other hand, Swift said, “We are starting to see some signs now that really provide some hope”.
He noted that while recent key economic bellwethers, such as US job losses and declining manufacturing activity, still show worsening conditions, “the rates of decline are slowing for most indicators”.
Swift also noted that the index of leading economic indicators, published monthly by the Conference Board, have been positive for the last two months after being negative for the prior 18 months or so.
“If you get three successive months of positive change in those leading indicators,” Swift said, “historically that indicates there will be a change of direction in the real economy some six months out.”
Other indicators show that international shipping rates for dry bulk cargoes are trending up, suggesting a possible return of global trade, he said. The gain in the price of oil from roughly $40/bbl to around $47/bbl also could reflect an increase in business.
Swift noted too that China’s industrial production rose sharply in February and is up year over year from 2008.
“There is still a lot of negative news ahead,” he said. “But there are some encouraging signs out there, so we’ll see.”
The Department of Commerce (DOC) said that the overall US trade deficit declined in January to $36bn (€28bn) as US exports and imports both fell, reflecting the global recession.
US exports of goods and services in January totalled $124.9bn against imports of $160.9bn.
January’s deficit of $36bn marked a nearly 10% decline from December’s revised trade deficit of $39.9bn.
In chemicals, the US trade deficit fell more sharply, off by more than 60%.
Kevin Swift, chief economist at the American Chemistry Council (ACC), noted that US exports of chemicals in January fell marginally to $10.743bn compared with revised December exports of $10.753bn, a difference of only $10m.
“Not much change there, and that is sort of encouraging,” Swift said.
That slim decline in exports is slightly encouraging because US chemical imports in January fell significantly, down to $11.748bn compared with December imports of $13.783bn, a difference of just more than $2bn and a decline of 15%.
“So we went from a chemicals trade deficit of $3bn in December to a deficit of roughly $1bn in January,” Swift noted.
However, while the lower $1bn deficit is a relative improvement compared with December, January’s deficit compares unfavourably with the $64m chemicals trade surplus seen in January 2008, he said.
And, with both export and import volumes still trending down - US overall exports were above $160bn monthly in mid-2008 - the reduced trade deficit is a slim silver lining.
“These numbers I think reflect a collapse in international trade and the synchronised global recession, which are affecting US exports of chemicals” Swift said. “The EU is in recession, Japan is in a deep recession, our trading partners in Canada and Mexico are in decline and emerging markets are also in recession.”
On the other hand, Swift said, “We are starting to see some signs now that really provide some hope”.
He noted that while recent key economic bellwethers, such as US job losses and declining manufacturing activity, still show worsening conditions, “the rates of decline are slowing for most indicators”.
Swift also noted that the index of leading economic indicators, published monthly by the Conference Board, have been positive for the last two months after being negative for the prior 18 months or so.
“If you get three successive months of positive change in those leading indicators,” Swift said, “historically that indicates there will be a change of direction in the real economy some six months out.”
Other indicators show that international shipping rates for dry bulk cargoes are trending up, suggesting a possible return of global trade, he said. The gain in the price of oil from roughly $40/bbl to around $47/bbl also could reflect an increase in business.
Swift noted too that China’s industrial production rose sharply in February and is up year over year from 2008.
“There is still a lot of negative news ahead,” he said. “But there are some encouraging signs out there, so we’ll see.”
quoted from: www.ICIS.com
