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Winter 1997 - Volume 2, No. 3

Tennessee International Trade Report
3rd Quarter 1996

Tennessee's anemic 1996 export performance continued through the third quarter. At $2.085 billion, the value of the state's exports was virtually unchanged from a year ago. Exports to the state's largest markets, however, were actually quite solid. Mexico was the standout, with Tennessee sales continuing to recover from the 1995 peso crash. Mexican exports were up nearly 29 percent, while both Japan and Canada grew in the 4-5 percent range. The state's most robust export growth was to Australia and New Zealand, where shipments were up 53 and 74 percent respectively. Exports to Latin America were also strong, rising $28 million from a year ago, though Brazil, Colombia, Argentina and Chile accounted for all of this growth, and disguised sharp declines elsewhere in the continent. Though sales to South Africa declined by 10 percent, exports to other African countries exploded: Ghana, Egypt, and Nigeria all posted increases of over 200 percent.

But combined export losses of over $100 million in Europe and the Chinese Economic Area entirely offset these gains. Sales to every member of the European Union declined from last year. In percentage terms, shipments to the Chinese markets posted even steeper declines. China itself, where exports were off almost 60 percent, was the single worst performer of the state's traditionally large markets.

Export reverses were concentrated in three industries, textiles, agricultural crops, and primary metals. A collapse in agricultural sales to China, where exports fell from $23.6 million to $0, along with a poor performance in Europe, led to a 63 percent loss in exports from last year, the most serious decline among the state's major export industries. Primary metals sales were off by over a third, while textiles, down 19 percent, continued their long decline. These losses were sufficient to erase good performances in nearly all the other major sectors of the state's economy. Particularly noteworthy was a 20 percent increase in apparel exports and a 15 percent gain in transportation industry exports. The former continues to defy predictions that it would be a NAFTA casualty, while the latter's third quarter growth (mostly due to large gains in Mexico and Japan) pushed the industry close to accounting for 25 percent of all state exports.

Thus far the fourth quarter is a mixed bag. October exports were the strongest of the year, up nearly 10 percent. But November's fell almost 4 percent.

Tennessee's Largest Export Sectors, 3rd Quarter 1996

Tennessee's Leading Trade Partners

Tennessee's Exports of Stone, Glass, and Clay Products, 3rd Quarter 1996

(Producers of these products turned in the best 3rd quarter growth performance among the state's large export sectors)

Tennessee's Exports to China, 3rd Quarter 1996

Largest Growth and Decline in Exports by Industry, 3rd Quarter 1996

Fast Changing Export Destinations, 3rd Quarter 1996
Among countries averaging more than $2 million in sales per quarter.

Tennessee Monthly Exports
(Seasonally adjusted, expressed in 1993 dollars)

Exports in $Millions                                                     Nominal Growth Rate(%)

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