No Trump Effect Yet as U.S. Import Growth Continues in January | — Panjiva
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No Trump Effect Yet as U.S. Import Growth Continues in January

  • By Christopher Rogers
  • · February 15, 2017
  • ·

U.S. imports likely continued their strong growth trend from 2016 into the new year. Panjiva data shows U.S. seaborne imports increased 5% on a year earlier, the seventh straight month of growth. Imports from the European Union were the leader, with 15% growth. The early lunar new year did not have a detrimental impact on China, which rose 6%, but did on South Korea which contracted 0.2%. Toy imports were the fastest growing sector for a second month, though it is the 4% growth in auto imports (with a 29% jump from Germany) and a 7% steel shipment rise that will attract President Trump and Commerce Secretary Ross’s attention.

U.S. imports started 2017 as they finished in 2016, with a growth in seaborne shipments of 5.4% vs. a year earlier, Panjiva data shows. That was the seventh straight month of growth. The expansion in imports may contribute to a further expansion in the overall U.S. trade deficit on a year earlier, following the 4.2% increase in December as discussed in Panjiva research of February 7.

That may give President Trump plenty to sink his teeth into as the renegotiation of NAFTA and bilateral discussions with Japan and others get going. The outlook may not be as strong – the most recent ISM manager survey was evenly balanced between growth and contraction in import orders.

MORE OF THE SAME

Total U.S. seaborne shipments during the month Source: Panjiva

The drivers of import growth were also similar to those seen in December. The European Union continued to be the biggest driver of expansion, with exports to the U.S. climbing 14.8% on a year earlier. That may add fuel to the fire of recent comments about currency manipulation levelled at Germany by the National Trade Council.

China and Hong Kong also continued to expand, with a 5.7% increase despite the lunar new year being two weeks earlier than a year before. That did, however, have a negative impact on South Korea, whose exports fell 0.2% after climbing 5.8% in December. That may suggest the country’s export growth is more Asia- than American-centric.

THAT DARN WEAK EURO

Figures shown on basis of trailing three month totals to reduce seasonality in Asia data around holidays Source: Panjiva

Among the key sectors oil was the worst performer compared to a year earlier. This is likely to be the result of the higher oil price – 63.4% above a year earlier after OPEC’s production cut – making domestic production more economical. Apparel also continued to underperform, and fell 3.0% for the seventh straight decline.

The strongest sector for the second month was toys, which had a late pre-holiday surge that appears to have continued. The toy importers have had contrasting fortunes, with Mattel and Toys’R’Us reporting weak holiday sales, Bloomberg reported, while Hasbro turned in a much stronger outcome.

The most contentious industry during the month, at least in terms of pronouncements by President (then -elect) Trump was automotive. Imports increased for a sixth month, with completed vehicle and parts shipments rising 3.6%. That included a 29.1% bounce in imports from Germany, and may be a sign of the industry attempting to preempt any new tariffs or border-adjustable taxes. Finally, a 6.5% increase in iron and steel imports may convince Commerce Secretary appoint Wilbur Ross that self-initiated trade cases are a necessity.

PLENTY OF GROWTH, APART FROM CLOTHES AND OIL

Data for shipments segmented by HS code for furnishings (HS 9401/3), autos and parts (8703/8), apparel (6110/6204), toys (9504), steel (7304/6/7) and oil (2709) Source: Panjiva

 

This research was first published in the Panjiva Daily, which features global trade news and data-driven insights and is free for all Panjiva subscribers. To learn more about our data, research and services please email sales@panjiva.com

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