Exports of manufactured goods continued to dominate total U.S. exports in September, per the Commerce Department trade data released today. Manufactured goods accounted for 80 percent of goods exports and nearly 60 percent of overall exports of goods and services in September.
Manufactured goods exports in September were $100 billion — 15 percent larger than in September 2010, exactly the growth rate needed to double in five years – the Administration’s export goal. Manufactured goods imports in September were $140 billion — up 9.5 percent, considerably more slowly than exports.
But because of the larger size of imports, the slower growth rate of imports generated about the same dollar increase as exports – so the manufactured goods trade deficit for September remained unchanged from a year ago, at $40 billion.
The important sector of capital goods, accounting for over 40 percent of manufactured goods exports, showed a warning flag. September capital goods exports were up 11 percent over the year-earlier period, a significantly slower growth rate than for overall manufactured goods. The slow economic growth of major U.S. customers, particularly in Europe, is holding back demand for machinery and other capital goods. In fact, 19 of the 32 capital goods categories showed export declines in September compared to last month.
On the import side, consumer goods imports registered much lower growth than in earlier periods, with September consumer goods imports up only 3.6 percent over September last year – reflecting the slow growth in U.S. consumer purchases.
The latest Commerce Department data for free trade agreement (FTA) partners shows they continue to be the brightest part of manufactured goods trade. The manufactured goods trade balance with FTA partners so far this year is on track to register a record surplus of $40 billion or more for 2011, compared to the huge deficit with countries that have not opened their markets to U.S. exports through free trade agreements.
Frank Vargo is vice president for international economic affairs, National Association of Manufacturers.