U.S. goods exports sinking at fastest pace on record in December
The U.S. trade balance fell to a six-year low in December as the global market for U.S.-made goods shrank at a record pace while Americans also decreased their appetite for imports, the Commerce Department reported Wednesday.
The trade gap - the difference between imports and exports of goods and services - fell to a seasonally adjusted $39.9 billion in December, the lowest in nearly six years, from a revised $41.6 billion in November. A year earlier, the trade deficit was $57.6 billion.
The trade report reflects weaker global trade flows that are being exaggerated by falling prices.
The shrinkage in the trade gap was largely due to falling prices for imports, especially petroleum. The average price of imported crude oil fell 25% in December to $49.93, the lowest price in three years.
Imports measured in current dollars dropped 5.5% to a seasonally adjusted $173.7 billion. That's the lowest since September 2005.
Nominal exports of goods and services fell 6% to a seasonally adjusted $133.8 billion, the lowest since May 2007. Exports of goods alone fell a record 8.6%, despite a doubling of exports of civilian aircraft.
In real terms (that is, adjusted for price changes), imports of goods fell 1.6%, while exports of goods fell 6%. The real trade deficit in goods rose 8.1% and has increased in four of the past six months.
2008: Year of exports
For all of 2008, the trade deficit narrowed 3.3% to $677.1 billion from $700.3 billion in 2007. Exports increased 12% to $1.84 trillion, while imports rose 7.4% to $2.52 trillion.
Rising exports accounted for much of the growth in gross domestic product during the year. In real terms, imports fell 3.3% in 2008 while exports rose 6.5%.
Combined, the deficit of $386 billion for petroleum and the deficit of $266 billion with China accounted for 96% of the 2008 annual trade deficit.
December details
Exports of capital goods decreased 1.5% to $36 billion, despite a doubling in aircraft exports to $4 billion. Exports of semiconductors and industrial engines fell sharply.
Exports of autos fell 14% to $7.7 billion, the lowest in four years.
Exports of industrial supplies fell 16.7% to $22.7 billion on falling demand for chemicals, plastics and petroleum products.
Exports of consumer goods fell 6.2% to $12.3 billion on falling demand for drugs and household appliances.
Exports of foods and feeds fell 9.2% to $6.9 billion on lower exports of wheat and corn.
Exports of services dropped 0.4% to $45.1 billion.
Imports of capital goods decreased 4.3% on lower shipments of electronics.
Imports of autos and parts dropped 9.3% to $14.9 billion, the lowest since May 1999.
Imports of industrial supplies fell 11.6% to $42.9 billion, the lowest in more than three years, on lower oil prices.
Imports of consumer goods fell 1.3% to $36.4 billion. Rising demand for drugs offset lower shipments of textiles and apparel.
Imports of foods and feeds fell 2.4% to $7.1 billion.
Imports of services fell 0.4% to $33.4 billion.
