Nevada’s copper and blood pay the price for U.S.-China trade war — Panjiva
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Nevada’s copper and blood pay the price for U.S.-China trade war

China 2205 Health Care 145 Info Tech - Tech Hardware 505 Materials - Metals/Mining 571 Metals - Copper 51 Switzerland 4 Tariffs 1505 U.S. 3973

U.S. trade policy has become increasingly hawkish under the Trump administration, and there’s signs that would continue in the next Presidential term whether under a Republican or Democratic President, as outlined in Panjiva’s research of Feb. 11.

The run-up to the Nevada primary on Feb. 22 may feature more commentary on trade positioning from Democratic Party candidates, currently lead by Senator Sanders with a 23.7% share of latest polling, according FiveThirtyEight, ahead of Senator Biden on 18.6%.

Nevada has seen a marked worsening in its exports over the past two years. Panjiva’s analysis shows that while exports are below average for the state – at $2,959 per capita versus $4,808 for the nation overall in 2019 – there has been a 26.4% drop in 2019 versus 2017. That’s equivalent to $1,049 per capita – the second worst performance in the country after Washington state. 

TRADE MATTERS LESS FOR NEVADA, BUT HAS SUFFERED MORE

Chart segments U.S. exports by state. Source: Panjiva

Yet, most of that decline was down to a collapse in gold exports. Most notably, gold exports to Switzerland fell to $1.22 billion in 2019 from $4.68 billion in 2017, or a 73.9% slide. That’s a marked drop given gold prices actually improved by 11.0% on average over the same period, Panjiva’s analysis of S&P Global Market Intelligence data shows.

Excluding the $1,186 per capita drop in gold exports there was therefore a more encouraging $144 per capita rise in all other exports. 

NEVADA’S GOLD CRASH NOT OFFSET BY OTHER TRADE LINES

Chart segments exports from Nevada by product. Source: Panjiva

While total exports have improved, there’s been a significant drop of 43.9% year over year in 2019 versus 2017. That compares to a drop in Indiana of just 1.6%. For context that’s meant Nevada’s exports to China fell to $169 per capita in 2019 from $302 in 2017.

The main driver of the drop has been a slump in copper exports to zero from $246 million in 2017, though that’s been offset at the state level by increased exports to other countries. Mines include KGHM’s Robinson, Newmont’s Phoenix and Nevada Copper’s Pumpkin Hollow. The latter came online from late 2019 and so may help a recovery in exports in 2020.

In terms of manufacturing, the biggest loser has been exports of hematology and vaccine products which dropped to zero from $96 million. 

There’s also been a downturn in electronics with processor shipments down by 27.3% and circuits off by 32.2%. Longer-term there may be further declines if the trade war pushes China to improve its own high tech manufacturing.

Exports of lithium-ion batteries to China, worth $32 million in the past 12 months, likely represented shipments by Tesla. Again though those may fall in the future following the opening of Tesla’s gigafactory in Shanghai.

TRADE WAR SLASHES COPPER, PHARMA AND ELECTRONICS EXPORTS

Chart segments exports from Nevada to China by product. Source: Panjiva

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