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Overall, manufactured exports flat in 2001

May 1, 2002


Rob Grunewald Regional Economic Analyst
Overall, manufactured exports flat in 2001

District manufactured exports reflected the slower economic activity abroad in 2001 but still recorded better numbers than the country as a whole. After climbing 12 percent in 2000, district exports increased only 1 percent in 2001; nationally, manufactured exports dropped 7 percent last year.

Total manufactured exports were up 28 percent in North Dakota, 2 percent in Minnesota and level in Wisconsin, while dropping 11 percent in South Dakota and 21 percent in Montana. Exports from the district's computer and electronic products industry posted mild gains in many district states, while machinery noted mild decreases. Manufactured exports to Canada and Europe were mixed, while exports to Japan showed surprising increases.

Some states and sectors post mild gains, others drop

Exports from the district's computer and electronic products sector, the largest export industry, were softer in 2001 (3 percent increase) than the previous year (15 percent increase), but North Dakota saw a 31 percent increase, while Montana decreased 20 percent. A similar disparity occurred in machinery exports: North Dakota posted a 66 percent increase, but South Dakota dropped 64 percent. Meanwhile, exports of food and kindred products increased 23 percent in South Dakota, 36 percent in Montana and about 10 percent in Wisconsin and North Dakota, but were down slightly in Minnesota.

North American exports mixed

Canada, the largest export destination for all district states except Minnesota, recorded mixed demand, with increases of 14 percent and 2 percent in North Dakota and Minnesota, respectively, while exports from Montana, South Dakota and Wisconsin dropped between 3 percent and 9 percent.

Strong increases in district exports to Mexico were posted in 2000 but softened in 2001. Montana saw a 70 percent drop due to slowing exports from the primary metal manufacturing sector. In contrast, exports from South Dakota to Mexico increased 28 percent.

Exports to Europe up-and down

Exports to Europe jumped almost 60 percent in North Dakota, due in large part to increases in machinery exports. Meanwhile, exports destined for Europe decreased 50 percent in South Dakota and 27 percent in Montana.

Thus far a relatively small export destination, the former Soviet republics posted increases during 2001 in all states except Wisconsin. For example, South Dakota exports to the former Soviet republics increased from $10,573 in 2000 to $3.6 million in 2001, primarily in food and kindred products.

Exports to Japan increase, but weaken to Asian NIEs

Despite a slow Japanese economy and a weak yen, which dropped about 14 percent in value relative to the U.S. dollar in 2001, exports from all district states increased, except for a slight decrease in Wisconsin. Manufactured exports to Japan from South Dakota and Montana climbed 100 percent and 32 percent, respectively. While district exports posted gains, total US manufactured exports to Japan dropped 12 percent in 2001.

Manufactured exports bound for Southeast Asia increased in almost all states, including a 146 percent climb in South Dakota, primarily in computer and electronic products. Exports to Southeast Asia from other district states increased between 20 percent and 33 percent, except Minnesota, which decreased 17 percent.

However, exports to the Asian newly industrialized economies (NIEs) of Hong Kong, Singapore, South Korea and Taiwan decreased, especially in North Dakota (27 percent) and Montana (13 percent).

Exports to China were mixed, ranging from an 80 percent increase in Wisconsin to a 59 percent drop in North Dakota. Despite the growing size of the Chinese market, exports to China represent less than 3 percent of total manufactured exports from the district.