The U.S. trade deficit widened in October as exports resumed a steady decline, the latest sign a slumping global economy is draining foreigners’ appetite for American-made goods.
For the first time in at least a decade, imports fell in both September and October at each of the three busiest U.S. seaports, according to data from trade researcher Zepol Corp. analyzed by The Wall Street Journal. Combined, imports at the container terminals at the ports of Los Angeles, Long Beach, Calif. and around New York harbor, which handle just over half of the goods entering the country by sea, fell by just over 10% between August and October.
The pact could have a major effect on California, home to the nation’s busiest ports and a major exporter of electronics, farm products, machinery and other goods and services to Pacific Rim countries.
Among the steps not taken are requirements that all ships slow as they approach the port and shut down their diesel engines and plug in to onshore electricity when docked to reduce harmful emissions. Also not met were mandates that trucks and yard tractors be fueled by less-polluting natural gas and other alternative fuels.
Those exporters have suffered this year as China’s economy has cooled. In September, the Port of Long Beach, Calif., part of the country’s busiest ocean-shipping gateway, handled 197,076 outbound empty boxes. They accounted for nearly a third of all containers that moved through the port last month. September was the eighth straight month in which empty containers leaving Long Beach outnumbered those loaded with exports.
U.S. exports of goods and services fell to $185.1 billion, the lowest level since October 2012. But the overall figure tells only part of the story. Overseas shipments of goods were the weakest in more than four years, while the figure for services was the highest on record.
The state’s exports of goods to foreign markets in August totaled $13.24 billion, down 9% from the $14.55 billion recorded in August 2014. By way of comparison, overall U.S. merchandise exports fell by 10.4% over the same period, while exports from Texas shrank by nearly one-fifth (19.1%).
The U.S. Census Bureau and the U.S. Bureau of Economic Analysis, through the Department of Commerce, announced today that the goods and services deficit was $48.3 billion in August, up $6.5 billion from $41.8 billion in July, revised. August exports were $185.1 billion, $3.7 billion less than July exports. August imports were $233.4 billion, $2.8 billion more than July imports.
The gap reflected a drop-off in exports, due in part to lower oil prices, along with rising imports of consumer goods such as cellphones, toys and apparel. Imports climbed 1.2%, while exports fell 2% to their lowest level since October 2012.
The U.S., Japan and 10 other countries around the Pacific reached a historic accord Monday to lower trade barriers to goods and services and set commercial rules of the road for two-fifths of the global economy.
“Rice grown in Arkansas and other Southern states has filled much of the void, along with rice from Europe and Australia. It’s likely just a temporary shift. But after back-to-back years of weak crops, some Sacramento Valley growers are starting to worry about their long-term international prospects even if El Niño packs a serious punch this winter, as some forecasters predict.”
in the delivery of specialized services such as technical consulting. In California, 775,000 jobs were supported by goods-related exports and 85 percent of these jobs were in manufacturing.
Overall cargo volumes at the Port of Los Angeles declined 2.5 percent on a year-over-year basis last month to more than 699,000 standard container units.
All that international trade creates tens of thousands of jobs in California along supply chains that reach out through the Inland Empire counties of San Bernardino and Riverside and into the Central Valley. The gateways also serve the state’s manufacturers and farmers, who last year shipped more than $170 billion in merchandise abroad. And crucially in a state with ever-widening income disparities and that ranks 48th in the percentage of adults with no more than a high school education, the freight industry almost uniquely continues to offer large numbers of unskilled blue-collar workers a chance to earn middle-class wages.