CEA update on Q2 exports and imports
Latest data show growth in volume and value of UK exports of construction and earthmoving equipment
LATEST data from the Construction Equipment Association (CEA) show that UK exports of construction and earthmoving equipment continued to show modest growth in the second quarter (Q2) of 2016, reversing the declining trend seen in 2015 due to poor demand in many major overseas markets.
Measured in volume terms (tonnes), exports showed 6.1% growth in Q2 2016, compared with Q1, at 136,000 tonnes. However, compared with the same quarter in 2015, Q2 2016 was still 10.3% below last year’s level (see graph).
Measured in value terms, exports also showed an improving trend, but at more modest levels. Q2 2016 showed a 0.7% increase on Q1 at £595 million, which, in turn, was 4.4% higher than Q4 2015.
Exports of equipment to EU markets remain on a rising trend, and account for a growing proportion of total exports. In volume terms, exports to EU countries accounted for 47% of total exports in the first half of 2016, compared with 40% in 2015.
Latest market forecasts suggest that this trend is likely to continue in the second half of 2016, with equipment demand in European markets growing at stronger rates than all other markets except India.
The UK remains a net exporter of construction and earthmoving equipment, with the surplus remaining relatively stable in the last 18 months, within a range from 60,000 to 70,000 tonnes per quarter.
In Q2 2016 the surplus was 62,000 tonnes, very similar to Q1 2016 levels. On a value basis, the export trade surplus has shown a narrowing trend in recent quarters, with Q2 2016 at £244 million, compared with an average of more than £300 million per quarter in 2015.
UK imports of construction and earthmoving equipment showed further increases in Q2 2016. Measured in volume terms, imports showed a 10.5% increase in Q2 compared with Q1, at 74,000 tonnes. However, in the first half of 2016 import levels were still 11% below 2015 levels.
In the first half of 2016, UK equipment manufacturers exported machines to over 160 different countries. The top three destinations, which accounted for more than 40% of total exports in volume terms, were: the US (22%), Irish Republic (10%) and Germany (9%). Exports to the Irish Republic and Germany continue to show growth in 2016, while exports to the US have fallen back from levels seen in the first half of 2015.
Meanwhile, UK imports of construction and earthmoving equipment arrived from over 60 different countries in the first half of 2016. The top two sources of imports were Japan and Germany, similar to 2015. Between them, they accounted for 31% of total volume and 34% of total value in the first half, and both countries showed increased levels in Q2 compared with Q1.