1st Quarter 2016

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Tennessee Trade Report

by Steven G. Livingston | 1 | 2 | 3 | 4 | 5 | 6 | 7 |
Tennessee's modest 0.66% export gain over the year ranked 10th among U.S. states.

Tennessee exporters eked out a 0.66% gain over last year's first quarter. This modest increase (from $7.78 billion to $7.83 billion) was the 10th best among all American states, showing how difficult the export environment is right now. Overall American exports fell almost 7% for the quarter.

The state faced the same basic problem as the rest of the country: the sizable slowdown of emerging-market economies. Tennessee experienced sizable losses in South America and the Middle East, while Southeast Asia was a wash. Gains to the developing world were pretty much limited to China (where exports grew 8% despite a large decline in cotton shipments), Hong Kong, Saudi Arabia (because of a very large increase in auto sales), and Singapore. Smaller gains were made in Turkey and India. Shipments within North America were also flat, with those going north of the border almost unchanged from 2015 and those to Mexico up just $6 million (to $1.121 billion).

That doesn't mean there weren't some shifts in the NAFTA-area shipments. Computer and automotive products gained substantially in Canada versus declines in lawn mower and medical instrument sales, while Mexico saw large increases in automotive shipments (though a big drop in diesel engines) and cell phone equipment against declines in computers and kraft paper. Japan, too, was off. Exports to Japan fell 9 percent (to $407 million), despite a big increase in electric storage battery parts, the star industry for the quarter. The fall was largely due to declines in various auto part shipments.

The state's ability to make any export gains, then, basically resulted from solid performances in Europe. Exports to the Eurozone grew from $968 million to $1.129 billion, while Britain added another $40 million. For the Eurozone, the medical industry produced most of these additional exports. Its exports increased by almost $100 million from a year ago, a rather remarkable 41%. The story in the U.K. was again electric storage battery parts, shipments of which soared from virtually 0 to $47 million.