US Trade gap widens on larger petroleum imports
by Rex Nutting, MarketWatch
Global trade rebounded further in March, driving U.S. exports and imports to their highest levels since October 2008, the Commerce Department estimated Wednesday.
The U.S. trade deficit – the difference between exports and imports of goods and services – increased by $1 billion to a seasonally adjusted $40.4 billion, the highest since December 2008 when global trade contracted violently after the September 2008 financial crisis.
In March, imports increased 3.1% to $188.3 billion, while exports climbed 3.2% to $147.9 billion. Shipments of raw materials increased the fastest, but all categories of imported and exports goods showed growth.
In the first three months of the year, imports were up 18.6% compared with the same period a year ago, while exports were up 19%. The trade deficit averaged $38.9 billion a month during the quarter, up from $36.3 billion in the fourth quarter.
Imports of petroleum increased sharply in March to $22.3 billion, the most since October 2008. The average price of crude oil rose about 2% to $74.32, while the volume of imported crude rose 11% to 9.66 million barrels a day, not seasonally adjusted.
Most of the increase in trade value came from higher volumes, not higher prices. The real trade deficit (adjusted for price changes) increased 3.6% as real imports increased 3.5% and real exports rose 3.4%.
Trade flows have not fully recovered from the brutal global recession, however. Real imports remain about 10% below the peak established two years ago. Real exports are 7% beneath the peak of August 2008.
Exports of goods and services increased 3.2%, including a 4% rise in goods alone. Exports of services climbed 0.9%.
Imports of goods and services increased 3.1%, including a 4.3% gain in goods alone. Imports of services fell 1.3%.
Exports were led by a 7% increase in shipments of industrial materials and supplies to $31.4 billion. Exports of capital goods rose 1.8% to $36.7 billion, led by generators, semiconductors and airplane parts.
Exports of foods and feeds rose 1.8% to $8.4 billion. Exports of autos and parts rose 0.4% to $9.2 billion. Exports of consumer goods rose 5.5% to $14 billion.
Imports were led by a 7.5% increase in shipments of industrial materials. Crude oil accounted for most of the gains, but metals and chemicals also increased significantly.
Imports of capital goods rose 0.8% to $34.4 billion, led by aircraft, machinery and drilling equipment. Imports of autos and parts rose 7.7% to $17.3 billion.
Imports of consumer goods rose 1.4% to $38.6 billion, led by TVs and drugs. Imports of foods and feeds rose 5.3%, led by fruits and vegetables.
Imports from Mexico rose to record $20.1 billion. Exports to the European Union increased to $21 billion, the most since late 2008. Exports to Japan and imports from Japan were at the highest levels since October 2008.
The trade deficit with China increased to $16.9 billion in March. So far this year, imports from China have risen 12.4% compared with last year while U.S. exports to China have increased 46%.