Export surge continues for California-based manufacturers

The news comes in advance of this week’s Institute of Business Forecasting & Planning’s “Best Practices” conference in San Francisco this week
By Patrick Burnson, Executive Editor
October 17, 2011 - SCMR Editorial

California exporters recorded another month of brisk double-digit growth in August - the 22nd consecutive month in which the state’s export trade increased on a year-over-year basis.

The news comes in advance of this week’s Institute of Business Forecasting & Planning’s “Best Practices” conference in San Francisco this week.

Goods exported by California businesses in August were valued at $13.91 billion, a nominal gain of 17 percent over the $11.89 billion reported in the same month last year, according to an analysis by Beacon Economics of foreign trade data released this morning by the U.S. Commerce Department.

The state’s gain was slightly larger than the 16.6 percent year-over-year increase in overall U.S. merchandise exports.

California’s manufactured exports rose 14.6 percent from $7.96 billion to $9.12 billion, while non-manufactured exports (chiefly raw materials and agricultural products) jumped 27.6 percent from $1.27 billion to $1.63 billion. Re-exports, meanwhile, were up 19.2 percent from $2.95 billion to $3.16 billion.

On a seasonally-adjusted basis, California’s export trade in August was up marginally over July.

“Adjusting for inflation, we are firmly operating at pre-recession levels of exporting,” said Jock O’Connell, Beacon Economics’ International Trade Adviser.

“This is great news for the California economy,” added Christopher Thornberg, Beacon Economics’ Founding Partner. “One of the reasons the state suffered more than most during the recent downturn was its exposure to the collapse in exports in business and consumer products. Expanding exports has helped stabilize the economy despite ongoing issues in construction and domestic business investments.”

Still, while Beacon Economics expects continued gains in California’s export trade through the remainder of the year, it warns that the rate of growth is likely to be more modest.
“We will continue to see growth in exports, just not as robustly as we might like,” O’Connell said.

One reason is that many of the state’s leading trading partners have been throttling back on private consumption and public expenditure. Europe’s sovereign debt crisis also clouds the outlook.

“Europe’s leaders have been displaying all of the resolve of Hamlet in a financial drama that has gone on for way too many acts,” O’Connell said. “Even though less than one-fifth of California’s export trade involves European nations, this issue plagues the global financial system.” 

One result has been a lately resurgent dollar.

“With the euro under siege, the greenback has gained appreciably in value since the end of August,” O’Connell observed. “That may be good news for U.S. importers and for American tourists travelling overseas, but it does tend to constrain our export trade by making our goods more expensive in foreign markets.”



About the Author

image
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 .(JavaScript must be enabled to view this email address).

Subscribe to Logistics Management magazine

Subscribe today. It's FREE!
Get timely insider information that you can use to better manage your
entire logistics operation.
Start your FREE subscription today!

Recent Entries

Manufacturing activity in April remained on the right side of growth for the second straight month, following six months of contraction, according to the April edition of the Manufacturing Report on Business from the Institute for Supply Management (ISM).

Some 22 centuries after the original Silk Road smoothed the path of Chinese silk merchants to Europe, a new effort is beginning to build a new 21st century highway between Europe and the burgeoning economy of China, now the world’s fastest-growing market.

A new study released recently from global management consulting firm A.T. Kearney promises to provide supply chain managers valuable advice on risk mitigation

The most recent edition of the Shippers Conditions Index (SCI) from FTR showed solid gains for the fourth straight month, with market trends remaining favorable for shippers.

Shippers and other ocean cargo carrier stakeholders should be cheering the announcement made today by The U.S. Coast Guard, as it formally notified the International Maritime Organization through a Declaration of Equivalency that the United States position on SOLAS is that there are multiple methods to submit the combined cargo and container weight (Verified Gross Mass or VGM).

Article Topics

News · Global · Supply Chain · Exports · All topics

About the Author

Patrick Burnson, Executive Editor
Patrick Burnson is executive editor for Logistics Management and Supply Chain Management Review. Patrick covers 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. Contact Patrick Burnson

Comments

Post a comment
Commenting is not available in this channel entry.