UK equipment exports continue on upward trend
Construction and earthmoving equipment exports rise in tonnage and value terms in Q2 2017
UK exports of construction and earthmoving equipment continued on an upward trend in the second quarter (Q2) of 2017, showing growth for the fourth consecutive quarter, according to the Construction Equipment Association’s market data manager, Paul Lyons.
Overall, Q2 2017 levels were the highest for two years, since Q2 2015. Exports in Q2 2017 increased by 5.3% in weight terms (tonnage of machines) compared with Q1 2017, and 2.0% in value terms, reaching £714 million.
In the first half of 2017, exports were 19.1% higher than the same period in 2016 on a value basis, at £1,413 million, whilst on a weight basis, exports in the first half were 11% ahead of 2016 levels.
According to Mr Lyons, the increasing levels of exports of equipment can be attributed to both improving demand in many of the major overseas markets, as well as the benefit of the weaker pound sterling exchange rate since the middle of 2016, following the Brexit referendum.
The US remained the top destination for UK exports in the first half of 2017, accounting for 19% of total exports on a weight basis, and 23% on a value basis. Collectively, exports to the EU countries accounted for 48% of the total weight of machines exported in the first half of the year, and 44% of the value. These were similar proportions to the 2016 annual levels.
Meanwhile, imports of equipment also showed further increases in Q2, and appear to be following the same seasonal pattern as the last two years, ‘peaking’ in the April–June quarter, and ‘bottoming’ in the October–December quarter.
In Q2, imports showed a 4.3% increase on Q1 2017 in weight terms, and a 2.6% increase on a value basis, reaching £398 million. As with exports, imports were also at their highest level since Q2 2015 on both a weight and value basis. In the first half of 2017, imports were 15.8% higher than the same period in 2016 on a value basis, at £786 million, whilst on a weight basis, imports were 3.4% ahead of 2016 levels.
Higher levels of imports of equipment in the first half of the year are consistent with statistics on sales of equipment in the UK, according to the UK construction equipment data exchange, which shows an increase of 6% in equipment sales in the first half of the year compared with the same period in 2016.
Japan remains the highest single country source of imports in 2017, accounting for 19% of total imports of equipment in the first half of the year on a value basis. Imports from Sweden also remain strong this year, accounting for 17% of total equipment imports, and have taken Sweden from fifth in the 2016 ranking to second place so far this year.
Overall, the UK remains a net exporter of construction and earthmoving equipment, measured in both weight and value terms. In Q2, the trade surplus increased slightly on Q1 levels, to £316 million. This was lower than the surplus of £340 million in Q4 2016, but after this, was the highest quarterly surplus since Q4 2015.