Exporting In

Exporting In

Copyright 2008, Traffic World, Inc.

While much of the transportation industry has been focused on the flow of imported goods and the infrastructure that''s needed to support it - you know, the "tsunami of containers preparing to hit California" - actual events have taken a different turn.

U.S. manufacturing is growing at a sharp rate and shippers have no doubt what is keeping the U.S. economy on its feet and potentially even primed for a recovery.

To the manufacturers, it''s all about exports.

According to the U.S. Department of Commerce, U.S. exports of goods grew 9.1 percent in the first quarter, a sharp rate that was anything but an anomaly. Exports grew more than 9 percent in 2006 and 2007 and they''ve grown 28 percent since 2005, more than three times faster than the overall economy, according to the National Association of Manufacturers.

Meanwhile, imports have been on a steady slide downward, with growth slowing sharply each year since the 2004 peak of 11.9 percent until imported goods declined 1.1 percent in the first three months of this year.

The NAM, which is becoming increasingly active in the transportation and logistics arena, is highlighting the strong export story this year as it tries to start a drum beat for free trade agreements and the greater access they''ll bring to foreign markets for U.S. manufacturers.

But the vibrant export sector also has important implications for the companies that carry those goods and, perhaps more importantly, for how those companies and state and federal governments plan for future freight flows.

It''s become almost accepted wisdom, after all, that the U.S. freight transportation economy begins when containers are unloaded at the ports of Los Angeles and Long Beach. But trade patterns can change more easily than weather patterns, it appears.

Trade was 16 percent of U.S. economic growth in 2006, then 32 percent in 2007. In the first quarter, NAM Chief Economist David Huether said, trade accounted for 90 percent of what little growth there was in the U.S. economy.

And that trade is made up of the goods that make up big-ticket shipments. Capital goods make up 40 percent of exports last year and industrial supplies were 26 percent. The largest single share of exports, at 29 percent, went to Europe.

These are the goods keeping large parts of the transportation sector moving, and they illustrate how important it is to diversify business rather than bend strategy too far toward the winds of today''s shipping patterns.

Huether expects the stark gap between imports and exports to close in coming months. "We''ve seeing exports grow 9 percent or so while imports decline," he said. "Both those trends will moderate, so we see more 6 to 7 percent growth in exports and imports growing 2 to 3 percent and not in negative growth territory. That trend is going to continue for the rest of the year."

It''s not as if there is no demand for imports right now, of course. It''s just that most of the demand turns out to be for empty containers.