Business Monday

April 19, 2015

A decade of change in Miami’s export picture

It might appear, on the surface, that South Florida’s trade with the world has changed little in the last decade. After all, in 2004, Miami ranked No. 13 among the roughly four dozen U.S. Customs districts. At the end of 2014, it ranked No. 12.

Over the course of the decade, U.S. trade grew 73.71 percent while trade in South Florida increased somewhat more rapidly but not terribly so, up 96.89 percent. Drilling down to exports and imports, the totals are strikingly similar — with South Florida’s growth slightly ahead of national averages. Miami’s percentage of U.S. trade has grown somewhat as well, from 2.58 percent to 2.92 percent, according to WorldCity analysis of U.S. Census Bureau data.

A big difference

But there is a big difference in one area. While the U.S. trade deficit has grown from $654.83 billion to $721.74 billion — slightly more than 10 percent — South Florida’s trade surplus has grown from $1.25 billion to $15.05 billion. That’s an 1,100 percent increase in the Miami surplus while the nation has increased its deficit.

What’s up? Understanding that divergence becomes easier when you look at the 10 exports that have grown the most in value over the last decade and those that have fallen the most.

First, those that have fallen the most, since the story there is more telling.

No single export has dropped more in value over the last decade than the category that includes cameras and camcorders, down $729.73 million, from $1.51 billion to a still-not-insignificant $779.21 million.

As we all know, our cellphones now act as cameras and camcorders, among other things. Who needs a camera? Although the category ranked No. 4 in 2004, it still ranks No. 12, so apparently quite a few people still do.

Here are six of the remaining top 10, in terms of loss of dollar value over the last decade: men’s or boys’ suits; pantyhose and socks; knitted or crocheted apparel; other woven cotton fabrics; miscellaneous knitted or crocheted fabrics and T-shirts. What do they have in common? Apparel manufacturing, it is clear, has largely left South Florida. In fact, one look at the labeling on your clothing will confirm that.

The highest current ranking among these six is pantyhose and socks, which ranked as the 19th most valuable export in 2004 but had fallen all the way to No. 146 by 2014. T-shirts have fallen from No. 17 to No. 283, down 89.60 percent. You get the idea.

A 100 percent drop

One of the 10 exports has actually fallen 100 percent from 2004. In fact there have been no exports in this category since 2006. The category is recorded music. All but the youngest of us can remember recorded music — albums, cassette tapes, CDs. Who among us has bought any of these recently?

So, we know what has fallen and what stories it tells. What has grown the most in value over the last decade? Certainly there are some hints in those things that have fallen.

No export has increased more in value over the last decade than that camera-market-destroying cellphone. Exports from Miami have increased $4.55 billion, and the ubiquitous device has gone from being South Florida’s No. 7-ranked export to No. 2 in 2014. Most of South Florida’s exports head to South America and the Caribbean Basin, of course, and the cellphone is clearly part of the success Latin America has experienced over the last decade. In fact, South Florida leads the nation in cellphone exports. Many of the world’s largest cellphone distributers, as I have written previously, have Latin America offices here or are headquartered here, companies like Tech Data, Intcomex, Brightstar and Ingram Micro.

The category that includes civilian aircraft, engines and parts — South Florida’s most important export in 2014 — has increased $4.12 billion in value over the last decade. While cellphone exports have increased 667.77 percent in value over the last decade, the aviation category has increased a relatively modest 184.10 percent. That’s because it ranked No. 1 in 2004 also.

South Florida is both a hub for aviation maintenance and repair as well as the North American hub for Embraer, the Brazilian company that is one of the world’s largest jet manufacturers, and the Latin American hub for Bombardier, the Canadian jet manufacturer that also ranks among the world’s largest.

Here are another four of the top 10: computers, printers, medical instruments and medicine. These four speak to the relative political stability and economic growth that have defined much of Latin America over the last decade. The rising middle class, and the growth of business in the region to provide products and services to them and each other, means more computers, more printers and more access to health care (medical devices and pharmaceuticals).

An interesting category

An interesting category on the list is cotton. As apparel manufacturing has shifted, first to the Caribbean Basin and then on to Asia, South Florida has seen its apparel role change from manufacturer to that of supplier. Cotton exports have grown in value 142.69 percent, growing from $309.70 million to $751.61 million.

Don’t expect stasis, however. If more apparel manufacturing shifts to Asia, for example, expect cotton exports to drop. In fact, cotton exports last reached a record in 2011. Printers also might face challenges, if businesses in particular keep their information digitally. While Miami leads the nation in these exports, the 2014 total was the lowest since 2009.

In fact, of the 10 exports that have grown the most in value over the last decade, only two set a record in 2014 — medical instruments and medicine. This is both a positive and a negative, of course. Positive in that more Latin Americans have access to healthcare, which is strongly suggestive of longer lives, better quality of life and the opportunity to improve productivity. Negative in that five of the top 10 last set records in 2012, including aircraft, computers and printers.

Over the last decade, South Florida’s exports have shown the most growth in high-value exports and shown the greatest deterioration in lower-value exports. That has allowed South Florida exports to grow more rapidly than the national average, and led to rapid growth in its trade surplus.

 

Ken Roberts is the founder and president of WorldCity, a Coral Gables-based company. He serves on the Federal Reserve Atlanta Branch’s Transportation and Trade Advisory Committee. More import-export trade data is available at www.ustradenumbers.com. He can be reached at kroberts@worldcityweb.com.

Decline in exports by category

Though total exports from Miami have grown almost 118 percent over the past decade, Miami exports dropped by 3.55 percent between 2013 and 2014. These categories were most affected:

One-year

change

2014 rank

Category

2014

1-year

change

1-year

change

10-year

change

10-year

change

-2

12

Cameras, camcorders

$779,213,834

($124,303,274)

-13.76%

($729,733,802)

-48.36%

-1

9

Computer parts

$1,213,745,212

($101,630,844)

-7.73%

($580,405,588)

-32.35%

9

220

Heterocyclic chemical compounds

$38,987,967

$3,477,779

9.79%

($223,351,066)

-85.14%

7

283

T-shirts, tank tops, knit or crocheted

$25,584,844

$1,785,098

7.50%

($220,462,063)

-89.60%

12

160

Misc. knitted or crocheted fabrics

$62,492,419

$9,405,400

17.72%

($217,295,043)

-77.66%

52

871

Other woven cotton fabrics

$1,271,849

$532,086

71.93%

($185,890,943)

-99.32%

-15

1214

Recorded music

$0

$0

NA

($169,407,121)

-100.00%

-22

515

Knitted or crocheted apparel

$7,573,179

($908,842)

-10.71%

($152,542,548)

-95.27%

27

146

Pantyhose, socks

$73,515,877

$21,290,009

40.77%

($149,055,430)

-66.97%

0

371

Men's or boys' suits, not knit

$14,471,076

($460,834)

-3.09%

($130,243,026)

-90.00%

Source: WorldCity analysis of U.S. Census Bureau data

Related content

Comments

Editor's Choice Videos