2nd Quarter 2017

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Tennessee Trade Report

by Steven G. Livingston | 1 | 2 | 3 | 4 |
It was the best quarter for the state's exporters since the second quarter of 2015.

Tennessee exports grew six percent in the second quarter over last year. Total foreign shipments rose to $8.431 billion, making it the best quarter for the state's exporters since the second quarter of 2015. The state slightly exceeded the national performance (by a mere tenth of a percent), with Tennessee ranking 22nd among the American states in its export growth.

The quarter's relatively good numbers were driven by a small set of industries that posted substantial export gains. Among large sectors, big increases were posted by the aircraft industry (up $80 million, a 27 percent gain), cotton (up $71 million, a 37 percent gain), and computers (mostly laptops, up $81 million, a 22 percent gain). Several smaller export industries also did very well. Exports of silicon more than tripled, to $98 million. Three nations, Germany, Korea, and Japan, accounted for almost all of silicon shipments. The scrap metal industry, agricultural and construction machinery, and nonwoven fabrics were other industries that did very well for the quarter.

A few industries, however, struggled. Cell phone parts were off $34 million, an 18 percent decline. Medicaments, DVD sales, and air conditioners all suffered more than 20 percent drops. A number of auto parts also experienced substantial losses. Transmission parts, for example, fell more than 16 percent, while the generic motor vehicle parts sector fell from $411 million in the second quarter of 2016 to $352 million this past quarter. The biggest percentage drops, though, were in the battery sectors. Electric battery exports dropped by more than half, to $69 million (this too was highly concentrated, with nearly all this loss in either Japan or the U.K), while primary cell and battery exports also fell by half, to just $17 million.

For automobiles, the state's largest export, the quarter was rather schizophrenic. Cars with larger engines (over 3,000 cc) did quite well, with exports up $70 million, while cars with smaller engines (between 1,500 and 3,000cc) did quite poorly, losing $116 million. Meanwhile hybrid vehicle shipments rocketed from zero to $79 million. Perhaps surprisingly, $72 million of that went to China. Jordan, of all places, accounted for half of the rest. The net of these disparate performances was a five percent gain for total motor vehicle exports.