Business Monday

Gateway City/Trend: Tough times for computer exports

Ken Roberts
Ken Roberts

For the past three years, and four of the past five, South Florida has accounted for more than 90 percent of all U.S. exports of computers to Central America, South America and the Caribbean. That’s the good news.

The bad news is that Latin America’s share of U.S. computer exports has dipped from a high of 17.15 percent of the total just three years ago to 12.68 percent of that total through the first eight months of 2015, according to the most recent U.S. Census Bureau data.

U.S. exports to Latin America, which stood at $3.18 billion through the first eight months of 2012, were at $2.08 billion through August of this year, the most current data available at this writing. That is a 34.58 percent decline.

In that same time period, South Florida exports to Latin America are down a similar but slightly smaller 31.16 percent. The figures do not include Mexico, which, while often considered part of Latin America, is in North America.

Computer exports are important to South Florida’s trade with the world. They rank No. 3 in value, behind aircraft and aviation-related exports, the top export, and the No. 2 export, cellphones and related equipment.

About 80 percent of all South Florida computer exports fly from Miami International Airport, with much smaller numbers leaving from Port Everglades and PortMiami.

U.S. rank: Computer exports are not only important to South Florida. The category is the nation’s ninth most important export, trailing only aircraft, gasoline and other refined petroleum products, motor vehicles, motor vehicle parts, cellphones, a special category called low-value shipments, computer chips and medical instruments.

While South Florida’s exports to Latin America and U.S. exports there are down more than 30 percent in the last three years, U.S. exports to the world are down just 11.53 percent. Just as is the case with computer exports to Latin America, the high-water mark for computer exports from the United States to the world was three years ago.

Because of that, computer exports, on a national level, have lost some stature. Ranked as the nation’s fifth most important export a decade ago, they had dropped to No. 7 by 2010 and are down one more in rank this year, when compared to last year, to No. 9.

Part of what is going on nationally, in South Florida and even around the world is rather simple: Our phones are becoming more powerful and we are finding either less need for desktops and laptops or a reduced need to replace them as often. In 2011, cellphones first surpassed computers among the nation’s top exports. It had happened in South Florida one year earlier.

South Florida trade: While computer exports have fallen in stature over the last decade on a national level, that’s less the case locally. Although computers were South Florida’s second most important export a decade ago, and while they had dropped to No. 4 by 2010, the category has rebounded slightly to its current No. 3 position. That improvement has as much to do with the decline in the value of gold exports, however, as any strength in computer exports from South Florida.

The 2015 total of $2.09 billion in computer exports is the lowest total since the first eight months of 2009, the last year the total was below $2 billion at this time of year.

Export markets: Among the top 15 markets for South Florida exports of computers, only two are not in Central America or South America: No. 10 Mexico and No. 12, the United Arab Emirates. The top eight — all of them in Latin America — account for more than 75 percent of the total and have for eight consecutive years.

The leading market for South Florida computer exports, as is the case with so many other leading exports, is Brazil. And therein lies part of the the problem.

Just since last year, exports from South Florida to South America’s leading economy are down 34.74 percent, proof positive if any were needed that the Brazilian economy is being rocked by political and economic crisis. That has led a substantial currency swing vis a vis the dollar that has been devastating for U.S. exports.

But, unfortunately, it is not just Brazil where computer exports are suffering.

South Florida exports to No. 2-ranked Colombia are down 25.03 percent from a year ago at this time, a total of 35.38 percent if you go back to 2012. Exports to No. 6-ranked Paraguay, what I like to call suburban Brazil because of its proximity to the much-larger nation and presumed role in funneling shipments there, are down 40.50 percent from last year. Exports to No. 7 Ecuador are down 33.84 percent.

South Florida competition: Despite all these downward trends, South Florida remains the nation’s top gateway for U.S. exports of computers, a position it has held since 2007, when it surpassed Detroit, which funnels its exports to Canada, and San Francisco, which was No. 2 at the time. It was barely ahead of Los Angeles that year, having passed it the year before. No “port” — airport, seaport or border crossing — has the volume of MIA.

It has been a pretty good decade for Latin America, and, by extension, MIA and South Florida.

This year, South Florida is responsible for 12.71 percent of all U.S. exports, down from the 2012 peak of 16.44 percent, but one of only two Customs districts accounting for more than 10 percent of the total. Los Angeles is the other, topping 10 percent for the first time since 2007.

Coming next: South Florida’s fourth most important export is medical instruments.

Reach Ken Roberts, president of World City, at kroberts@worldcityweb.com. Twitter: @tradenumbers.

Computer exports suffer across nation

Total

U.S. trade

August 2015

YTD

1-year

change

1-year

change

10-year

change

10-year

change

Change

in rank

August 2015

YTD

All districts

$ 16,426,921,561

-$1,123,820,610

-6.40%

$229,327,331

1.42%

0

1

South Florida

$ 2,087,731,011

-$419,818,056

-16.74%

$698,539,619

50.28%

2

2

Los Angeles

$ 1,713,093,542

$159,279,460

10.25%

$297,056,961

20.98%

-1

3

Detroit

$ 1,521,625,732

-$164,057,315

-9.73%

-$368,377,086

-19.49%

-1

4

El Paso, Texas

$ 1,441,663,175

-$143,775,371

-9.07%

$584,608,348

68.21%

0

5

New York City

$ 1,200,886,002

-$307,745,486

-20.40%

$20,819,055

1.76%

3

6

Laredo, Texas

$ 968,315,422

$168,420,354

21.06%

$10,549,990

1.10%

-1

7

San Francisco

$ 926,403,731

-$51,787,077

-5.29%

-$714,218,214

-43.53%

-1

8

Buffalo, N.Y.

$ 922,968,665

$27,509,448

3.07%

$392,924,789

74.13%

-1

9

Cleveland

$ 727,153,819

-$136,340,488

-15.79%

-$290,106,742

-28.52%

1

10

Chicago

$ 679,333,385

-$26,767,932

-3.79%

-$262,660,081

-27.88%

2

11

Seattle

$ 675,536,705

$97,429,700

16.85%

$198,430,144

41.59%

-2

12

New Orleans

$ 673,250,226

-$114,122,614

-14.49%

$128,580,387

23.61%

-1

13

Dallas-Fort Worth

$ 584,379,708

-$72,143,960

-10.99%

$40,792,205

7.50%

1

14

Houston

$ 397,523,191

$80,924,775

25.56%

$138,077,587

53.22%

-1

15

Atlanta/Savannah

$ 295,495,063

-$92,147,574

-23.77%

-$94,480,372

-24.23%

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

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