Business Monday

Brazil trade with Miami, U.S. having rocky year

Brazil is South Florida’s top trade partner and has been for more than two decades — as far back as the U.S. Census Bureau data that I use goes.

This is the first in a series of columns that will look in depth at South Florida’s top 10 trade partners. It is timed to the release of WorldCity’s 15th annual Miami TradeNumbers publication, a PDF version of which is available at no cost online at ustradenumbers.com. In the coming weeks, we will take a closer look at No. 2 Colombia, No. 3 China, No. 4 Chile, No. 5 the Dominican Republic, No. 6 Honduras, No. 7 Peru, No. 8 Venezuela, No. 9 France and, finally, Costa Rica, which ranked No. 4 at this time last year but has fallen to No. 10.

▪ U.S. rank: While it ranks No. 1 for South Florida, Brazil ranks as the United States’ No. 11-ranked trade partner through the first three months of 2015, the most recent data currently available. At this time last year, it ranked No. 10. Five years ago, it had also ranked No. 10. A decade ago, it ranked No. 14. U.S.-Brazil trade through the first three months of 2015 is down 11.75 percent, compared to total U.S. trade, which is down 3.07 percent.

▪ South Florida trade: Brazil trade with South Florida is down an almost equal amount this year, 11.16 percent, to $3.50 billion. Miami’s overall trade with the world is off 3.27 percent, also similar to the U.S. figure.

▪ Importance to South Florida: Brazil accounted for 12.82 percent of South Florida trade through the first three months of 2015. That’s the lowest percentage since 2007. In 2008 and 2009, Brazil accounted for more than 14 percent of South Florida trade through the first quarter.

▪ South Florida competition: Brazil’s No. 1 gateway for U.S. trade is South Florida. It has been No. 1 through the first quarter of every year for the last decade with one exception: In 2010, Houston was No. 1. Miami finished ahead of Houston that year, but did cede the No. 1 ranking to Houston in 2011 before reclaiming it in 2012. This year, South Florida is capturing 23.05 percent of all U.S.-Brazil trade, the third highest percentage in a decade. Houston is responsible for 19.56 percent, down from 22.21 percent, while No. 3 New Orleans is accounting for 8.74 percent this year, compared to 7.51 percent last year.

▪ South Florida exports to Brazil: Almost one-fourth of the value of all exports to Brazil from South Florida is on one category among the roughly, 1,265 categories: civilian aircraft, engines or parts. Consequently, when those exports are down, as they are in 2015, the export total suffers. Aircraft exports are down 23.05 percent through March; overall exports from South Florida are down 17.17 percent. Cellphone exports, which ranked No. 2 at this time last year, are down $100.79 million, equal to 38.90 percent, and to a No. 4 ranking. Bright spot? The category for military aircraft, engines and parts advanced from No. 29 to No. 9, growing 221.98 percent from the first quarter of 2014. When two similar categories — civilian vs. military aircraft — swing significantly in the opposite direction at the same time, as is the case here, I often wonder if it is due to a more careful classification, or a reclassification, rather than a coincidence.

▪ South Florida imports from Brazil: The new No. 1 import from Brazil is returned exports, after repair. It moved ahead of aircraft and a similarly titled category, returned exports, for repair. The “returned import” categories look similar to the situation with aircraft above. The former returned imports category — with repairs in Brazil — grew $188.92 million while the latter — with repairs in the United States, with the sense that they will be re-exported — fell $134.54 million. Overall, imports from Brazil increased 11.47 percent. Aircraft imports — Brazil is home to Embraer, the world’s third-largest jet manufacturer, with its North America headquarters at Fort Lauderdale International Airport — increased 20.05 percent. (On the import side, Census separates aircraft from engines and parts, though it does not do so on the export side.)

▪ Surplus/deficit: South Florida regularly runs a trade surplus with Brazil, South America’s largest economy, albeit a troubled one. Through the first three months of 2015, that surplus was $1.66 billion. That is the lowest surplus since 2007. It also accounts for most of the U.S. surplus with Brazil, which stood at $1.76 billion through March. A similar measure is the balance of trade, which looks at the percentage of total trade with a country that is an export. For every dollar of trade with Brazil, 74 cents is a South Florida export; the U.S. average for Brazil is 56 cents.

▪ Exports by port: Miami International Airport leads all airports and seaports for U.S. trade with Brazil, followed by the Port of Houston, the ports at Norfolk and Newport News in Virginia, the Port of New Orleans and the Port of Jacksonville. Port Everglades ranks No. 7, Fort Lauderdale International Airport No. 28 and PortMiami No. 37. By value, just under two-thirds of all South Florida trade with Brazil flies into MIA.

▪ Imports by port: The Port of Houston ranks No. 1 with Brazil on the import side, due to oil. MIA ranks No. 2 followed by Norfolk-Newport News, the Port of Newark, the Port of New Orleans, the Port of Mobile and Fort Lauderdale International Airport. Port Everglades ranks No. 20 on the import side while PortMiami ranks No. 60.

▪ Coming next: Through the first three months of 2015, South Florida trade with its second most important trade partner, Colombia, is down 13.13 percent in a rare piece of bad news for the shining star of South America the past several years.

Ken Roberts is founder and president of WorldCity, based in Coral Gables. He can be reached at kroberts@worldcityweb.com.

U.S. trade with Brazil, by Customs district

Change

in rank

March 2014

YTD

Total

Trade

March 2014

YTD

1-year

change

1-year

change

10-year

change

10-year

change

  

All Customs districts

$ 15,186,697,291

-$2,022,201,054

-11.75%

$6,110,728,064

67.33%

0

1

Miami

$3,500,075,504

-$439,480,348

-11.16%

$1,390,606,878

65.92%

0

2

Houston-Galveston

$2,969,885,774

-$852,137,260

-22.30%

$1,910,992,467

180.47%

0

3

New Orleans

$1,326,894,677

$33,809,222

2.61%

$491,529,318

58.84%

0

4

New York City

$1,081,001,751

-$47,321,229

-4.19%

$160,045,551

17.38%

0

5

Jacksonville/Tampa

$878,651,454

-$13,527,660

-1.52%

$476,100,442

118.27%

0

6

Norfolk

$822,525,219

$25,841,487

3.24%

$317,845,167

62.98%

5

7

Charleston

$527,053,723

$135,847,352

34.73%

-$6,307,101

-1.18%

-1

8

Mobile

$508,908,059

-$242,185,561

-32.24%

$313,752,081

160.77%

1

9

Los Angeles

$499,886,073

$571,105

0.11%

$112,263,916

28.96%

-1

10

Baltimore

$479,361,003

-$53,141,054

-9.98%

$42,237,130

9.66%

3

11

San Juan

$449,947,212

$175,307,927

63.83%

$284,124,189

171.34%

-4

12

Port Arthur, Texas

$368,366,544

-$266,988,870

-42.02%

$291,156,496

377.10%

-2

13

Atlanta/Savannah

$309,949,157

-$151,222,353

-32.79%

$117,509,997

61.06%

2

14

Philadelphia

$260,365,444

$28,132,778

12.11%

-$72,998,083

-21.90%

0

15

Chicago

$170,889,453

-$62,226,209

-26.69%

-$31,125,324

-15.41%

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

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