California exports rebounded sharply in 2010

The Golden State’s $143.3 billion merchandise export trade last year represented a 19.3 percent gain over the $120.1 billion in exports recorded in 2009.

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California’s exporters nearly clawed their way back to pre-recession levels of trade with a strong performance in 2010, according to an analysis by Beacon Economics of foreign trade data released by the U.S. Commerce Department.

The Golden State’s $143.3 billion merchandise export trade last year represented a 19.3 percent gain over the $120.1 billion in exports recorded in 2009. It was also California’s second highest export total ever, coming in just shy of 2008’s inflation-adjusted total of $149.9 billion.

Likewise, the $13.3 billion in goods California businesses shipped abroad in December exceeded the $11.6 billion the state’s exporters sent to foreign markets in December 2009 by a healthy 14.8 percent.

“Compensating for inflation, this was our best December ever, exceeding even the previous all-time high achieved during the peak year of the dot.com boom in 2000. December also marked the fourteenth consecutive month of year-over-year increases in California’s export trade,” said Jock O’Connell, Beacon Economics’ International Trade Adviser.

California accounted for 11.2 percent of all U.S. merchandise exports in 2010, but just 10.0 percent of its manufactured exports, the Beacon Economic analysis revealed. The state produced 12.3 percent of U.S. exports of non-manufactured goods and 19.8 percent of all of the nation’s re-exports last year.

The state’s comparatively large share of the nation’s re-export trade is a major reason why the generally robust growth in California exports over the past several months has not been reflected in the state’s employment figures, O’Connell pointed out.

“Re-exports are products that, by definition, have no significant value added to them during their sojourn in California, and so their beneficial economic impact is a great deal less than would be the case were these goods actually produced by California workers,” he explained.

California’s export growth continued to be led by airborne shipments of high-value items such as electronics components, medical and scientific instruments, and pharmaceuticals, O’Connell noted. 


For all of 2010, the number of outbound loaded containers through the state’s three principal seaports was up 9.2 percent, despite a 1.3 percent fall-off at the Port of Oakland. The two San Pedro Bay ports – the Ports of Los Angeles and Long Beach – combined for a 12.7 percent rise in export containers in 2010.

Meanwhile, export tonnage through California’s airports increased by 15.6 percent at San Francisco International and by 18.1 percent at Los Angeles International.

The outlook for California exports going into 2011 is for generally moderate growth, O’Connell said.

“Outside of Europe which continues to dither over accounting issues, our primary trading partners in Asia and Latin America have lately been seeking to head off inflationary pressures associated commodity price increases and with the high pace of economic growth they have been enjoying,” O’Connell said. This suggests that foreign demand for California’s exports could soon slacken off,” he added. 

The most serious non-economic concern facing California’s foreign trade does not involve political turbulence in the Middle East but rather tensions on the Korean peninsula.

“With the aggressive posturing we have lately been seeing on all sides of this unresolved conflict, a succession crisis in Pyongyang this year is by far is the most serious ‘Black Swan’ potentially threatening to disrupt world trade,” O’Connell warned.

South Korea, China, and nearby Japan account for almost one-quarter of all California exports. 

Brian Clancy, managing director, Logistics Capital & Strategy, LLC, made a similar observation in an interview last week.

“China’s economy is not as stable as many believe. There’s not enough transparency in its banking system to keep it on sustainable footing.”


About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review magazines and web sites. Patrick is a widely-published writer and editor who has spent most of his career covering international trade, global logistics, and supply chain management. He lives and works in San Francisco, providing readers with a Pacific Rim perspective on industry trends and forecasts. You can reach him directly at [email protected]

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