1st Quarter 2008

 

 

 

 

Tennessee International Trade Report (2)

Outside of the transportation and computer sectors, things were actually pretty good. Many products were able to take advantage of the lower dollar to significantly increase their exports. It was another good quarter for the state’s medical industries. Medical equipment sales were up strongly in the euro zone, the U.K., Japan, and Australia. Ostomy-related exports (i.e., materials for colostomies or urostomies, etc.) grew from virtually nothing to some $22 million. Total medicament and pharmaceutical exports were up well over 50 percent for the quarter.

Chemicals were strong, enough so that the sector was able to leapfrog the computer and electronics industry to again become the state’s second largest export industry. Most of the gains were in medical products, plastics, and synthetic textiles rather than in “pure” chemicals. The latter had a more difficult quarter due to a fall of more than $50 million in sales to Argentina, generally one of the largest markets for the state’s chemical producers.

The gains in synthetic textiles — artificial filament tow, to be exact (from $80 to $126 million for the quarter) — joined a resurgence of cotton exports ($60 to $157 million) and points to the importance of the overseas apparel industry for state exporters. Though the state has all but lost its own apparel industry, overseas producers now buy a significant portion of their inputs from the state. The substantial amount of cotton exported during the quarter marks a hoped-for return from its crash in 2006.

There were new signs of life in Tennessee’s food industry. Whiskey continues its upward trend (see accompanying article), but prepared potatoes (Pringles), vegetable oils, and prepared breads and cakes all made nice gains in the first quarter. Among the rising hi-tech stars for the quarter were video games, VCRs, and digital cameras. Exports of the first nearly tripled (to $36 million), while foreign sales of the latter two ($15 and $22.5 million, respectively) were off the charts. Most of these exports went to Canada, although camera sales were strong everywhere in the Americas. Two other hi-tech products, optical media and software, however, didn’t fare as well, each suffering substantial losses for the quarter.

Early reports for the second quarter suggest that Tennessee’s good news/bad news will continue. April exports are up 12.6 percent, a pretty good performance — but one that pales before the 20.51 percent gain posted by the nation. see tables