Merchandise Exports and Imports Down, Trade Deficit Up in 2015, ITC Report Finds
The International Trade Commission has updated its annual compendium of data and analysis examining changes in trade with key U.S. partners and in important industries. The “Shifts in U.S. Merchandise Trade 2015” report focuses on changes in U.S. exports and imports of agricultural and manufacturing goods and key natural resources as well as changes in U.S. trade with Brazil, Russia, Canada, Mexico, and parties to the ongoing Regional Comprehensive Economic Partnership negotiations. Industry and market profiles for ten sectors are included as well.
Energy Prices. This year’s report features a section on the effects of declining crude petroleum and natural gas prices on the U.S. economy and specific sectors. These declines contributed to higher U.S. imports of consumer goods, largely offsetting lower imports of energy-related manufactured goods. Lower prices also contributed to a substantial decline in the value of certain U.S. manufactured goods exports as global demand for U.S. equipment used in crude petroleum and natural gas production fell and the value of energy-consuming industry exports also declined. The large decline in the value of exports by U.S. energy-consuming industries masks an increase in the quantity of their exports as well as a rise in certain sectors' global competitiveness due to lower input prices.
Exports. The value of U.S. total exports fell 7.2 percent to $1.50 trillion, largely due to declining crude petroleum prices, weak global economic growth, and continued appreciation of the U.S. dollar. Exports in all but one of the sectors examined declined and the only sector with higher exports was footwear (0.2 percent). The largest declines by value occurred in energy-related products (down $49.2 billion), agricultural products (down $17.9 billion), and minerals and metals (down $17.2 billion).
Of the United States’ major single-country trading partners, exports to Canada declined the most in value (down $32.4 billion), with petroleum products and natural gas, steel mill products, and motor vehicles the sectors most affected. U.S. exports to China declined $7.5 billion, largely driven by China’s lower level of growth and subsequently lower demand for imports, while U.S. exports to the United Kingdom and Germany increased by $2.5 billion and $0.6 billion, respectively.
Imports. The value of U.S. general imports decreased 4.5 percent to $2.24 trillion. Energy-related products experienced the largest decline by value, down $157.2 billion, and the value of imports of minerals and metals fell $16.1 billion. Imports from all remaining sectors increased by $67.2 billion in total, with the greatest increases occurring in transportation equipment (up $22.5 billion), electronic products (up $11.0 billion), miscellaneous manufactures (up $10.4 billion), and chemicals and related products (up $8.9 billion).
Although imports from most major trading partners increased, imports from Canada, Japan, and India declined. U.S. imports from Canada experienced the largest decline among major trading partners, falling by $52.6 billion, largely driven by declines in imports of crude petroleum, natural gas, and petroleum products. Imports from China experienced the largest increase by value among major U.S. trading partners, growing by $15.1 billion. Notably, U.S. imports from members of the Organization of the Petroleum Exporting Countries declined 50 percent to $66.2 billion, again largely as a result of lower crude petroleum prices rather than changes in import volumes. Other significant decreases in U.S. imports occurred in steel mill products (down $7.7 billion), resulting from a decline in both prices and volume, and natural gas and components (down $7.1 billion).
Trade Flows. The United States’ top trading partners in 2015 continued to be China, Canada, Mexico, Japan, and Germany, which again accounted for more than half of total U.S. trade with the world. China supplanted Canada as the top U.S. trading partner for the first time, with $598.1 billion in two-way trade compared to $575.2 billion.
The U.S. trade deficit increased by 1.4 percent to reach $737.1 billion, the highest level in the past five years. Only the agricultural products sector had a trade surplus, but this surplus continued to decline, down 65.7 percent. All other sectors maintained trade deficits, although the 108.0 billion (56.6 percent) drop in the trade deficit in energy-related products partly offset the declining trade balance in every other sector and limited the growth of the overall trade shortfall. Sectors experiencing a large value increase in trade deficits included transportation equipment, chemicals and related products, electronic products, and miscellaneous manufactures.
Of the major U.S. trading partners, the trade deficits with Canada and India were the only ones to decline. The overall U.S. trade deficit with Asia increased by $51.5 billion while the U.S. had a $6.6 billion trade surplus with the OPEC countries, a reversal from previous years.