Exports Bounce Back: Increase of 17 percent in the first quarter

Minnesota export trends turned around in the first quarter of 2010, gaining 17 percent from the same period a year ago – the first year-over-year quarterly increase since the third quarter of 2008. The state exported US$3.9 billion in manufactured exports in the first quarter of 2010, representing a gain of US$569 million from the first quarter of 2009.

Minnesota's exports grew slightly less than U.S. manufactured exports, which gained 20 percent during the same period. Minnesota export trends turned around in the first quarter of 2010, gaining 17 percent from the same period a year ago – the first year-over-year quarterly increase since the third quarter of 2008. The state exported US$3.9 billion in manufactured exports in the first quarter of 2010, representing a gain of US$569 million from the first quarter of 2009.

Minnesota's exports grew slightly less than U.S. manufactured exports, which gained 20 percent during the same period.

Booming Exports to Asia Jump 75 Percent
• The state’s manufactured exports to Asia jumped 75 percent (up US$577 million) to US$1.3 billion, exceeding U.S. growth to this region of 41 percent. Minnesota exports to North America increased 20 percent to US$1.2 billion and to the Middle East gained 22 percent to US$89 million. However, exports to other regions fell – particularly the European Union (down 17 percent), mainly due to Ireland, where exports plunged 61 percent.
• Between the first quarters of 2009 and 2010, the state’s top two markets had the largest gains in export value, each increasing exports by around US$158 million. Sales to China (including Hong Kong) jumped 67 percent to US$395 million, fueled by strong gains in machinery, paper and chemical products. Export gains to Canada were driven by strong growth in transportation equipment, as well as chemical products.
• After China and Canada, Japan, Taiwan, South Korea, Thailand and the Philippines contributed the next largest gains in exports. The state’s exporters increased their sales by more than US$50 million in each of these Asian countries. Computers and electronics, miscellaneous products and chemicals contributed the most to export growth in Japan, while machinery and transportation equipment contributed the most to growth in Taiwan.

Exports from Most Major Industries Increase Sharply, Except for Miscellaneous Products
• Demand for the state’s computer and electronics products gained US$139 million (or 18 percent) – the largest gain among all industries, largely due to stronger exports to the Philippines (up 181 percent to US$81 million), Thailand (up 735 percent to US$45 million) and Malaysia (up 157 percent to US$57 million).
• Minnesota’s sales of chemical products also performed well, jumping almost US$100 million to US$264 million fueled by opportunities in Canada (up 63 percent to US$64 million), China (up 174 percent to US$32 million), Japan (up 96 percent to US$27 million) and South Korea (up 229 percent to US$19 million).
• The only major industry to decrease exports during this period was the miscellaneous (including medical) products industry. These exports dropped mainly due to decreased demand in Ireland (down from US$220 million to US$62 million). However, sales of these goods performed strongly to China, Japan and Germany.

Strong Export Growth in Four of Top Five Industries (in the Harmonized System)
• Machinery: Exports of machinery were valued at US$882 million, up US$87 million. The strongest growing product segments were office machine/computer-related parts, sand or liquid dispersing machinery, and centrifuges and filters. Office machine/computer-related parts were up 120 percent to US$117 million, based on strong performances in Malaysia and Thailand. Sand or liquid dispersing machinery exports were up 18 percent to US$108 million, with particularly strong gains in Canada and China.
• Electrical Machinery: Expanded opportunities in electrical machinery resulted in export gains of 24 percent (up US$103 million) during this period. The primary driver of growth was integrated circuits products (up 165 percent to US$138 million), based mainly on increased demand in the Philippines, but also in Canada and Taiwan.
• Plastic: Dynamic demand for plastic products – particularly self-adhesive materials (up 122 percent to US$115 million) – fueled US$115 million in export gains between the first quarters of 2009 and 2010. Nine Asian markets accounted for 60 percent of plastic exports from Minnesota, and most grew by more than 100 percent. Note: Some of these products are found in the paper sector under NAICS.
• Vehicles: Canada drove much of the export growth in vehicles, accounting for US$225 million of these exports.

Minnesota Quarterly Export Statistics is the most current resource available for tracking the state’s manufactured export trends and is prepared for the Minnesota Trade Office (MTO) by the Department of Employment and Economic Development’s (DEED) Analysis and Evaluation Office (Thu-Mai Ho-Kim, 651-259-7180). Past issues may be viewed on DEED’s Web site at www.PositivelyMinnesota.com/Data_Publications/Data/Export_Statistics/index.aspx. Exports by state (and by North American Industry Classification System industries (NAICS) are collected by the U.S. Department of Commerce (USDOC) and are distributed by the World Institute of Social and Economic Research (WISER). Other export data based on the Harmonized Tariff System (Schedule B) are collected by the USDOC and distributed by the Global Trade Information Services.