California's exports drop 4.6 percent

The Sacramento BeeNovember 9, 2012 

BIZ BIGSHIPS 5 OX

The MSC Fabiola passes passes Alcatraz Island as it heads to the Port of Oakland on March 21, 2012, in San Francisco, California.

ARIC CRABB — MCT/Oakland Tribune

— California's recently streaking export segment is streaking in the wrong direction.

California businesses shipped goods valued at $12.87 billion in September, down about 4.6 percent from $13.49 billion in September 2011, according to an analysis of Thursday's U.S. Commerce Department trade figures by Beacon Economics, a consulting firm with offices in the Bay Area and Los Angeles.

It was the third straight month that California exports saw a year-over-year decline. July marked the end of a 32-month streak of gains.

Analysts blamed fallout from Europe's economic woes and a decelerating pace of growth in Asia.

However, they also said that California exporters continue to exceed the inflation-adjusted pace they set in 2008, the peak pre-recession year for the state's merchandise export trade.

"Whether that will remain true through the year's final quarter is exceedingly uncertain," said Jock O'Connell, Beacon's international trade adviser. "Still, initial indications of nationwide export activity show that trade could have an upward influence on the revised third-quarter GDP figures when they are released."

Year-over-year export totals were down in all major categories. Exports of manufactured goods totaled $8.42 billion, down 1.9 percent from September 2011. Non-manufactured goods (chiefly raw materials and agricultural products) fell nearly 10 percent to $1.51 billion, and re-exports were off 9 percent at $2.94 billion.

Some products within categories did well. Fruit and nut exports, for example, were up 7.6 percent to $712 million.

O'Connell said there were other red flags to be found all over the map, including an imminent leadership change in China and bleak economic forecasts in Europe.

The European Commission's latest forecast projects gross domestic product to shrink 0.3 percent for the European Union to close out this year.

Growth in 2013 was projected at a decidedly tepid 0.4 percent.

On the import side, California took in $31.41 billion in September, up from $30.86 billion in September last year. Some goods entering California go to other states, so exports are considered a more accurate measure of the state's trade health.

Nationally, the U.S. trade deficit declined to its lowest level in nearly two years as September exports rose to a record high.

The Commerce Department said the August deficit of $44.2 billion narrowed to $41.5 billion in September.

Exports of U.S. goods and services rose 3.1 percent to an all-time high of $187 billion. Officials cited strong sales of commercial aircraft, heavy machinery and farm goods.

Imports rose 1.5 percent, to $228.5 billion.

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