New Record for Imports Likely As Protectionist Risks Fail To Arrive | — Panjiva
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New Record for Imports Likely As Protectionist Risks Fail To Arrive

  • By Christopher Rogers
  • · November 14, 2017
  • ·

U.S. seaborne imports surged ahead for an eighth month in October, rising 3% on a year earlier and setting a new record of 9.63 million shipments for the first 10 months of the year. Earlier concerns about a protectionist crimp in trade resulting from the policies of the Trump administration have not come to fruition. Exports from China led the way in absolute terms with a 5% rise. The steady shift of heavy manufacturing within Asia can also be seen in a 12% drop in seaborne shipments from Taiwan to their lowest in a decade, while those from Vietnam surged 11% ahead to equal July’s record. Consumer product imports remain varied. While apparel and toy imports were still lower the drop for both was below 1%. Growth in furniture and auto imports remain strong at 9% and 10% improvements on a year earlier respectively. Barring any new protectionist measures, an economic disaster or shipping industry problems it is likely 2017 will see imports that are 3.3% better than 2016 and reach a record of over 11.5 million seaborne shipments.

U.S. import growth continued unabated in October, with Panjiva data showing seaborne import shipments rose 3.2% on a year earlier. That makes the eighth straight month of growth, and 15th out of the past 16 (February’s drop reflected the timing of lunar new year). Year-to-date shipments of 9.63 million are a record for the first 10 months of the year. That shows earlier worries of a protectionist crimp on trade from the policies of the Trump administration have not yet taken effect.

THE IMPORT JUGGERNAUT ROLLS ON

Chart shows total U.S. seaborne shipments. Note data is provisional due to late reporting shippers. Source: Panjiva

Geographically, growth in absolute terms was once again led by shipments from China and Hong Kong, which increased by 5.4%. While the slowest rate of expansion since June, it would suggest yet another rise in the U.S. trade deficit with China lies ahead as outlined in Panjiva research of November 5.

The long-term trend of rotation in manufacturing industries out of Taiwan, South Korea and Japan and into lower cost economies including India, Thailand and Vietnam was also in evidence. Shipments from Vietnam climbed 11.2% to equal July’s record, while imports from Taiwan dropped 11.6% to their lowest in a decade.

OLD NEW MARKETS LOSING OUT TO NEW NEW MARKETS

Chart segments U.S. imports by sea by country of origin. Bubble size indicates total shipments. Source: Panjiva

At the product level department stores are reported to be taking deliveries later than in prior years due to concerns about demand, Reuters reports. Imports of apparel lagged, though tjey were only 0.4% lower than a year earlier, while toys fell by 0.4%. The latter is notable though as there had been five straight declines of 9% or more in the prior months, possibly due to concerns about the future of Toys’R’Us. Other consumer goods remained robust, however, with furniture imports rising 9% and autos/parts rising 10%. The latter is a response to replacement demand after September’s hurricanes, though may prove fleeting.

TOYS’R’COMING BACK TO GROWTH

Data for shipments segmented by HS code for furnishings (HS 9401/3), autos and parts (8703/8), apparel (61-64), toys (9504), steel (72,73), oil (2709) and . Note data is provisional due to late reporting shippers. Source: Panjiva

The strong performance of imports year-to-date would suggest – on the basis of prior years’ trade – that aggregate shipments should reach 11.51 million in the full year, or 3.3% better than a year earlier. Continued strength – albeit fading somewhat – in both business order expectations and consumer confidence (at near 17 year highs) would suggest imports will continue to grow in the remainder of the year. That’s assuming, of course, that no significant protectionist measures are implemented at late notice.

A (BAD) MIRACLE NEEDED TO AVOID A NEW RECORD YEAR

U.S. seaborne shipment data segmented by month Source: Panjiva

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