The Collapse in Aggregate Trade (of Goods), 2020/21 vs 2008
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Data through February 2021
One interesting point of comparison of is how trade has fared during the most recent collapse in economic activity due to the Covid-19 pandemic vs the collapse in trade during the Financial Collapse of 2008-2009. The plot to the left plots US trade in goods (not services, see below for more info) imports and exports during the Pandemic and the Financial Crisis. Things are reported in year over year growth rates. And the "0" date is center on September 2008 for the Financial Crisis, March 2020 for the Pandemic. The Trade data is from the US census FT900 historical archive and is not seasonally adjusted. With the most recent trade data through July, a couple of things stand out. - First, the collapse in trade while large and rapid, is smaller than what we saw during the 2008 period. This is despite the collapse in demand was far, far larger and rapid than what we saw in 2008. - Second, recovery is much more rapid, import growth is essentially back to pre-covid-pandemic growth rates (which actually were negative). And after hitting a trough in May, the recovery has taken place in two months. In contrast, the 2008 collapse did not trough until about 8-9 months out and the recovery was quite slow. - For the US data, in the pandemic episode, this does differ a bit on exports vs imports, which probably reflect (i) the dramatic collapse in production yet (ii) demand staying (relatively) strong after the initial shock. The expansion of the trade deficit is a natural consequence of consumption > production during these time periods. - One key difference between these two episodes was the state of trade leading into these crisis. Trade was expanding dramatically leading up into the 2008 Financial crisis, where as on the decline ( due to the trade war and tariff disruptions taken place) |
Data Sources: US Census International Trade Data FT900 archives
More on The Collapse in Aggregate Trade (in Services), 2020/21 vs 2008
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Data through February 2021
Background: I discussed below how the collapse in trade during the 2020 Pandemic episode was (i) not as deep relative to 2008 financial crisis and (ii) trade is returning to pre-pandemic growth rates much faster than the 2008 episode. But when grabbing the data from the Census's website, their presentation of aggregation got me thinking, what about service trade? In the post below, I had focused on goods trade, but services are an increasingly important component of trade (about 35% of US exports, 20 percent of US imports in 2019). This is what the plot to the left reports, year over year percent changes in service trade. Now you see the pattern is quite different than the goods trade figure: - Massive collapse in both US imports of services and US exports of services. Both are down about 30 % year over year. - Perhaps some sign of a slight uptick (lots of modifiers there), but not the strong rebound found in goods imports or exports. - Eyeballing the disaggregated service series, this was mostly driven by travel and transport. The travel component dropped two orders of magnitude (tens of billions to hundreds of millions). |
Data Sources: US Census International Trade Data FT900 archives
More Detail on the US-Canada Aluminum Dispute
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Data through February 2021
Background: On August 6th 2020, President Trump announced the re-imposition of tariffs on US imports of Aluminum products from Canada. The official announcement is here: www.whitehouse.gov/presidential-actions/proclamation-adjusting-imports-aluminum-united-states-080620/ This action follows a sequence of tariff actions on Aluminum for many countries starting from Proclamation 9704 in response to the Section 232 investigation into the effect of aluminum imports on national security grounds. Tariffs on aluminum products from Canada went into effect on June 1st 2018 and then were removed on May 20 2019. On September 15th, 2020, The USTR has announced that they are backing off the implementation of the tariffs, but that quantity limits would be put in place and if they are violated the tariffs would be reinstated. Details here: https://ustr.gov/about-us/policy-offices/press-office/press-releases/2020/september/ustr-statement-canadian-aluminum The figure to the left provides a further, refined view of this dispute. It plots the product of issue (HS760110 non-alloyed, unwrought aluminum) and plots both the dollar values and the quantity in tons. The blue shaded area reports the quantity triggers the value and 105 percent value of the trigger. |
Data Sources: US Census International Trade Data via API
US Exports of Lobster (European Union and China)
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Data through February 2021
For some reason, over the summer of 2020, there has been concern regarding US exports of lobster. On June 24, 2020 the White House issued a memorandum on the necessity of protecting the lobster industry; how the Phase One Agreement with China removes retaliatory tariffs on lobster and purchase agreements may support lobster exports to china; how the Comprehensive Economic and Trade Agreement between Canada and the European Union has hurt American exports of lobster to the EU. On August 21, 2020 the European Union and the US came to an agreement to reduce EU tariffs on American lobsters. The figure to the right plots US exports of lobsters. I used HS code 0306, note some shrimp are in there, but this gives you the idea. In both levels and in growth rates, it plots exports to China, the EU, and all countries (use the zoom -y-wheel tool to see it). The period surrounding the Section 301 tariffs and Chinese retaliation are shaded in grey, the period of the Phase One Agreement is shaded blue. |