Exports from Michigan surged 10.5 percent in February
Worldwide exports of goods reached $12.5 trillion in 2009. The world’s top three exporters — China, Germany and the United States — accounted for 27 percent of the world’s exports last year.
In the first two months of 2010, national exports rose to $197 billion, which is $30 billion or 18.2 percent more than the same period in 2009. The monthly numbers for 2010 indicate that American foreign sales are on a rapid recovery path following a deep downturn in 2009.
A strengthening in exports leads to an expansion in overall corporate sales, improves profitability, accelerates capital expenditures and, most important, results in creation of jobs.
During the January-February period, exports of goods from Michigan, seasonally adjusted, increased by an annual rate of 55.4 percent from the same period of 2009. Like the national numbers, state trade figures are adjusted for seasonal variation, a statistical process that smoothes volatility in monthly data by eliminating the effects of uneven recurring events such as the number of days in a month and holidays, which helps to provide a picture of the underlying trend in exports.
Accordingly, Michigan ranked second in export growth among the 50 states during in the first two months of this year.
In the latest snapshot of monthly trade numbers, exports from Michigan's companies surged 10.5 percent in February from the previous month, the sixth monthly increase in a row. At their February mark, foreign sales registered $3,918.1 million, seasonally adjusted, which is $371.1 million more than in January and the highest level since July 2008.
Manufactured goods, a major contributor of export-related jobs, accounted for 88 percent of all state exports. Foreign sales from Michigan's manufacturers increased in February by 14.0 percent from the previous month to $3,447.9 million, adjusted for seasonal variation.
On an annual basis, overseas shipments from state factories were $1,386.5 million, or 54.6 percent, higher than in February of last year.
Exports of non-manufactured goods went down 9.8 percent in February to $470.2 million, adjusted for seasonal variation. This group of shipments abroad consists of agricultural goods, mining products and re-exports, which are foreign goods that have entered the state as imports and are exported in substantially the same condition as when imported.
What are the prospects for global trade in 2010, which will influence the demand for Michigan's exports and eventually the state’s overall economic development along with the future of export-related jobs?
The World Trade Organization forecasts a rapid expansion in global trade in 2010. The projections suggest that Michigan companies will continue receive higher volumes of export orders from foreign buyers this year.
Evangelos Simos is chief economist of the consulting and research firm e-forecasting.com.