3rd Quarter 2010

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tennessee trade-weighted dollar index graph

tennessee monthly exports graph

tennessee monthly imports graph

tennessee's leading trade partners graph

See 4th Quarter Issue: [ Spring 2011 ]

Tennessee International Trade Report

by Steven G. Livingston

More than 36 countries at least doubled their purchases of Tennessee goods from a year ago.

Tennessee exporters had one of their strongest quarters in recent memory. Third-quarter exports were almost one-third higher than a year ago. The state's foreign shipments increased in value by over $1.6 billion from 2009, making the quarter's exports the highest in state history at $6.78 billion. One eye-popping figure might best express the breadth of this growth: more than 36 countries at least doubled their purchases of Tennessee goods from a year ago.

The star sectors were led by the auto parts industry, where exports increased 55 percent (to $598 million). Canada and Mexico accounted for 80% of this gain. The computer industry also increased its shipments by more than $100 million (to $494 million). Canada again was the major market, but Latin America was the destination of 40% of that growth. The aerospace sector was a third large gainer. Major increases in exports to Singapore (up $37 million), India ($13 million), Brazil ($20 million), and China ($51 million) led to a 30% growth in global exports. We can keep going. Chemical sales were up nearly $100 million worldwide, as were synthetic fibers. Car exports gained $92 million (mostly to the Middle East), and shipments of engines and motors grew 69% to $186 million. The single most dynamic export, however, was cotton. The value of cotton exports quadrupled from last year. In part this was due to its record prices over the summer. (The price of cotton this summer was twice what it was in 2009). China was the major destination for these shipments. Indeed, it was a good quarter for virtually anything made in Tennessee. A handful of industries saw declines, such as pharmaceuticals (down 18 percent), tires (8%), and DVDs (33%), but they were the distinct minority.

As might be anticipated from these numbers, the export gains were truly worldwide. Shipments to both Canada and Mexico grew by over 20%. China, thanks mostly to that cotton, was up 93.8%. Its fellow BRIC member, India, grew by 98.9%. The other two BRIC states, Russia (up 188%) and Brazil (44%), were equally strong for the quarter. The Middle East market grew from $166 to $262 million. The ASEAN (Association for South East Asian Nations) region also grew by about $100 million, to $386.2 million for the quarter. Japan and Korea were also robust markets (growing by 18.5% and 31.6%, respectively). The Latin American market, led by sales to Peru, Ecuador, and Colombia, increased 48% to just under $600 million. In Europe, sizable gains in Germany and the Netherlands produced a 14% increase in Tennessee exports. Only Greece among the imperiled euro debt-crisis nations reduced its Tennessee purchases for the quarter. However, not all European states showed gains. Exports to the U.K. were basically flat, and exports to France declined. Outside of Europe, the only region of the globe where sales were weak was Sub-Saharan Africa, where Tennessee exports fell from $66 to $62 million.

In sum, this was the second consecutive very strong quarter. The state's exporters have more than recovered from the 2008-2009 crisis and are selling more in global markets than ever before. The broad-based nature of this recovery, both geographically and sectorally, suggests that the state is well poised to make continued gains in the quarters ahead.

continued (tables)