US Trade Deficit Widens Despite Strong Exports

WASHINGTON (Dow Jones)--The U.S. trade deficit widened in October, despite strong growth in exports that indicated the global economy is picking up. The U.S. deficit in international trade of goods and services rose to $41.77 billion from a revised $41.34 billion in September, the Commerce Department said Friday. The September shortfall was originally reported at $41.27 billion. The trade gap was in line with analysts expectations. A Dow Jones Newswires-CNBC panel of 19 economists had forecast a deficit of $41.80 billion.

U.S. exports rose 2.6% to $87.96 billion in October--the highest level since March 2001. However, imports offset export gains, growing 2.1% to a record $129.73 billion.

For years U.S. economic growth has outpaced that of its trading partners, resulting in stronger U.S. imports than exports. Last month, the U.S. Commerce Department reported U.S. gross domestic product grew at an 8.2% annual rate, the highest quarterly performance since the first three months of 1984.

The weaker U.S. dollar is eventually expected to curb the American appetite for foreign goods and make U.S. exports more attractive. But in the short run, especially as long as global growth lags that of the U.S., analysts say the weaker dollar actually inflates the value of imports and depresses the value of exports.

Still, the broadbased October gains in exports are a sign growth outside the U.S. may be perking up. Foreign sales of U.S. foods, feeds and beverages, up $225 million, were at their highest level since June 1996. Exports of industrial supplies like chemicals, iron and steel, and cotton were up $622 million and capital goods imports, including aircraft and telecommunications equipment, were $852 million higher.

Automobile exports gained $182 million and foreign sales of consumer goods like pharmaceuticals and household appliances fell $178 million.

October imports gained on record U.S. demand for foreign-made consumer goods, up $1.47 billion, and automobiles and parts, up $1.0 billion. Imports of capital goods like computers and engines were up $160 million to their highest level since April 2001.

The nation's energy bill rose to $10.86 billion in October from $10.73 billion in the prior month even as the average price of a barrel of oil sank by 23 cents to $26.25. The quantity of foreign crude purchased was 327.44 million barrels, up from 316.19 million in September. In dollar value, the U.S. imported a total $8.59 billion of crude oil, up from $8.37 billion.

Deficits with major trading partners were mostly higher in October. The U.S. posted a record $13.57 trade shortfall with China, as record imports offset the highest-ever U.S. exports to the Pacific Rim nation. The deficit with Japan rose to $6.44 billion.

The shortfall with Canada narrowed to $4.91 billion and the deficit with Mexico expanded to $3.53 billion. The trade gap with Western Europe rose to $9.43 billion. -By Elizabeth Price; Dow Jones Newswires; 202 862 9295; elizabeth.price@dowjones.com

=DJ Table Of US Goods, Services Trade Balance Data

.
                                                     Year To Date
.                           OCT        SEPT        2003        2002
DEFICIT                    41.77       41.34      409.00      337.07
  PREVIOUS REPORT                      41.27
TOTAL IMPORTS              129.73     127.06     1246.37     1147.19
  PERCENT CHANGE             2.1        3.4         8.6        -0.5
TOTAL EXPORTS               87.96      85.72      837.37      810.12
  PERCENT CHANGE             2.6        2.9         3.4        -4.8
MERCHANDISE TRADE           46.37      45.49      446.18      379.02
  DEFICIT % CHANGE           1.9        5.0        17.7         8.6

(Dollar figures in billions, percent changes in monthly columns are from previous month. Percent changes in year-to-date columns are from previous year.)
 

  (MORE) Dow Jones Newswires

  12-12-03 0830ET- - 08 30 AM EST 12-12-03

=DJ Table Of US Trade Data -2: Imports, Exports

.
                                                        Year To Date
.                            OCT           SEPT       2003        2002

SERVICE IMPORTS             20.93         20.78      201.81      187.58
 TRAVEL                      4.94          4.90       46.46       47.84
 PASSENGER FARES             1.78          1.75       16.79       16.47
 OTHER TRANSPORTATION        3.80          3.76       37.20       31.50
 ROYALTIES, LICENSE FEES     1.64          1.64       15.91       16.20
 OTHER PRIVATE SERVICES      6.56          6.52       63.27       57.37
 DIRECT DEFENSE EXPEND       1.97          1.96       19.67       15.75
 OTHER U.S. GOVERNMENT       0.25          0.25        2.50        2.44

GOODS IMPORTS (CENSUS)     108.53        105.97     1041.58      956.75
 FOOD, FEED, BEVERAGE        4.78          4.79       46.02       40.79
 INDUSTRIAL (INCL OIL)      26.81         26.95      264.41      219.58
 CAPITAL (EXC AUTOS)        25.46         25.30      243.15      234.24
 AUTOS, PARTS               18.42         17.41      168.47        4.94
 CONSUMER(EXC AUTO,FOOD)    29.03         27.56      274.96      252.70
 OTHER                       4.02          3.97       39.64       40.97

SERVICE EXPORTS             26.60         26.01      250.68      241.78
 TRAVEL                      5.90          5.73       53.10       54.40
 PASSENGER FARES             1.47          1.38       12.72       14.21
 OTHER TRANSPORTATION        2.67          2.61       26.15       23.96
 ROYALTIES, LICENSE FEES     4.10          4.07       39.83       36.68
 OTHER PRIVATE SERVICES     11.18         10.97      107.77      101.87
 MILITARY SALES CONTRACTS    1.21          1.18       10.43       10.00
 OTHER U.S. GOVERNMENT       0.07          0.07        0.68        0.66

GOODS EXPORTS (CENSUS)      62.15         60.48      595.40      577.73
 FOOD, FEED, BEVERAGE        4.75          4.52       44.16       40.95
 INDUSTRIAL (INCL OIL)      14.71         14.09      143.19      129.66
 CAPITAL (EXC AUTOS)        25.56         24.71      240.22      243.67
 AUTOS, PARTS                6.93          6.75       66.50       65.96
 CONSUMER(EXC AUTO,FOOD)     7.54          7.72       73.91       70.20
 OTHER                       2.67          2.70       27.42       27.29

(DOLLAR FIGURES IN BILLIONS, SEASONALLY ADJUSTED)
 

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=DJ Table Of US Trade Data -3: Geographic Breakdown

.
  Trade Balance With: (Blns)
.                            OCT          SEPT      TO DATE

CANADA                     -4.907        -5.264     -45.828
MEXICO                     -3.527        -3.271     -34.452
EUROPEAN UNION             -8.679        -8.070     -76.618
AUSTRIA                    -0.316        -0.271      -2.132
BELGIUM                     0.409         0.306       4.282
FINLAND                    -0.191        -0.138      -1.697
FRANCE                     -1.163        -1.079      -9.565
GERMANY                    -3.626        -2.744     -31.557
ITALY                      -0.977        -1.084     -12.365
NETHERLANDS                 1.015         0.667       7.581
SPAIN                      -0.023        -0.042      -0.717
SWEDEN                     -0.765        -0.733      -6.423
U.K.                       -1.302        -1.083      -7.135
NORWAY                     -0.318        -0.355      -3.261
SWITZERLAND                -0.242        -0.257      -1.404
HUNGARY                    -0.227        -0.112      -1.561
POLAND                     -0.053        -0.051      -0.476
RUSSIA                     -0.105        -0.637      -5.359
AUSTRALIA                   0.618         0.658       5.687
CHINA                     -13.565       -12.692    -103.268
JAPAN                      -6.437        -5.134     -54.538
HONG KONG                   0.296         0.295       3.503
KOREA                      -1.561        -1.109     -10.265
SINGAPORE                   0.082        -0.068       1.248
TAIWAN                     -1.122        -1.408     -12.168
ARGENTINA                  -0.024        -0.050      -0.661
BRAZIL                     -0.606        -0.566      -5.745
COLOMBIA                   -0.213        -0.188      -2.323
INDONESIA                  -0.754        -0.624      -6.063
NIGERIA                    -0.896        -0.709      -7.859
SAUDI ARABIA               -0.923        -1.038     -11.675
VENEZUELA                  -1.285        -1.356     -11.603
EGYPT                       0.209         0.271       1.250
SOUTH AFRICA               -0.323        -0.171      -1.716
 

  (MORE) Dow Jones Newswires

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=DJ Table of US Trade Data -4: Petroleum Imports

.Imports of Petroleum and Related Products
.                           OCT          SEPT

BARRELS (MLNS)             402.34        394.33
  PERCENT CHANGE             2.0          -0.7
VALUE (BLNS)                10.86         10.73
  PERCENT CHANGE             1.1          -4.8
AVG PRICE PER BARREL       $26.25        $26.48

(Data for petroleum and geographic breakdown are reported on a customs basis and are not seasonally adjusted.)
 

  (END) Dow Jones Newswires

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