Business Monday

Gateway City/Trend: Also flying from MIA are billions in gold

Ken Roberts is president of World City.
Ken Roberts is president of World City.

At this time just three years ago, South Florida’s leading export was gold. No more. This year, gold is South Florida’s fifth most valuable export, down one from last year. In the grand scheme of things, this is a good development. It means that we’re all feeling a little better about things. More about that in a moment.

At one time, at the tail end of the global economic crisis — and that’s giving it a long tail — gold was briefly not only South Florida’s leading export but also its leading import. Gold was climbing in the ranks for two, related reasons: First, when investors are skittish, they often retreat to gold. They don’t trust the stock market, they don’t trust real estate. They don’t trust the dollar. They don’t trust, period. Second, when skittish investors are buying gold, two things happen.

First, the price spikes. And, indeed, it did. Second, with the price up, it becomes more profitable to mine gold. And that’s what happened.

That’s where South Florida came into play. Mining in Mexico and Colombia — it started with those two countries, from a South Florida perspective — grew rapidly, and a good deal of that gold flew into Miami International Airport before heading off, largely, to Switzerland. The Swiss are, of course, known for their discretion, or secrecy, in matters financial.

Traditionally, the nation’s 12th most important Customs district — where it ranks today — South Florida advanced during the global economic crisis to No. 10. Switzerland, South Florida’s No. 29-ranked trade partner before the crisis, ranked as high as No. 3 at the bottom. Mexico entered South Florida’s top 10 for the first time; Colombia reclaimed a No. 2 ranking.

It was all about gold. Further, South Florida became the nation’s top-ranked Customs district for gold imports and second only to New York City and Great Falls, Montana, for exports.

South Florida, in other words, became a hub for the world’s gold trade. Imagine that.

But, as it turned out and as we all know now, the world was not coming to an end after all. The price of gold began to fall, mining became less profitable, and South Florida’s trade patterns began moving back toward its more traditional ranking of exports, imports and trade partners.

Since 2012, the value of South Florida’s gold exports has fallen from $5.87 billion to $1.30 billion, a 77.86 percent decline. That is almost four times the value all South Florida exports have fallen in that time frame. This is through the first nine months of each year, the most recent data available for 2015.

U.S. rank: Just two years ago, at this time in 2013, gold was the United States’ fifth leading export, trailing only oil, aircraft, motor vehicles and motor vehicle parts. The value was $26.82 billion. By the first nine months of 2015, the value of gold exports had fallen to $15.03 billion and gold now ranks as the nation’s No. 11 export.

Today, U.S. exports of gold to Switzerland total $5.37 billion, down from $10.26 billion two years ago. Exports to Hong Kong have fallen from $8.36 billion to $3.11 billion in that time.

South Florida trade: Locally, exports to Switzerland were much more dominant and remain largely so. In 2012, the peak for South Florida gold exports, Switzerland accounted for $5.38 billion of the $5.87 billion total through the first nine months of the year, or more than 90 percent. This year, Switzerland is accounting for less than 60 percent of the total — $739.35 million of the $1.30 billion total.

What nations have gained market share? Overwhelmingly, the No. 2 market is the United Arab Emirates, with a 2015 total of $459.91 million. Is that the final destination or just a way station until it can head to Hong Kong or China? Hard to know. Is there money in the Middle East? Last time I checked, yes. Exports to the U.A.E. are down slightly from the 2012 total of $471.16 million, but down sharply from 2013, when the total was $956.44 million.

Nevertheless, those two countries make up 90 percent of the South Florida gold exports today.

Importance to South Florida: The ascent of gold was a truly remarkable event. In 2010 — before the gold mined in Colombia and Mexico began making its way to MIA — gold accounted for a paltry 0.10 percent of all South Florida exports. It ranked No. 145. The next year, gold accounted for 9.98 percent of all exports and the following year, in 2012, gold accounted for 10.81 percent of all South Florida exports – the second consecutive year it was the leading export to the world.

Today, gold is accounting for 2.95 percent of all exports. No export has accounted for more than 10 percent since. To my knowledge, no export in well over a decade has accounted for more than that 10.81 percent figure. To be sure, it was quite the run.

South Florida competition: MIA now ranks as the nation’s fourth most important for gold exports, trailing New York’s JFK, Salt Lake City International — part of the Great Falls Customs district — and Los Angeles International. Salt Lake’s gold previously went largely to Switzerland but now more of it heads to the United Kingdom and India. LAX’s gold largely goes to Hong Kong and Switzerland.

This is the fifth in a series of columns about South Florida’s top 10 exports. Coming next: Medicine is South Florida’s sixth most valuable export. Reach Ken Roberts, president of World City, at kroberts@worldcityweb.com. Twitter: @tradenumbers.

MIA among nation’s leading airports for gold exports

Total gold exports

September 2015 YTD

1-year change

1-year change

5-year change

5-year change

Change in rank

September 2015 YTD

Total all airports, seaports, border crossings

$ 15,028,530,117

$869,860,122

6.14%

$3,429,442,961

29.57%

0

1

JFK Int’l Airport

$ 7,624,763,969

$1,109,042,823

17.02%

$1,865,527,690

32.39%

0

2

Salt Lake City Int’l Airport

$ 2,996,136,881

-$382,303,582

-11.32%

-$2,207,444,687

-42.42%

1

3

Los Angeles Int’l Airport

$ 2,588,536,387

$1,355,020,323

109.85%

$2,566,797,163

11,807.22%

-1

4

Miami Int’l Airport

$ 1,298,758,128

-$1,233,852,052

-48.72%

$1,255,080,265

2873.49%

8

5

Alexandria Bay, N.Y. (border crossing)

$ 173,490,769

$164,728,550

1,879.99%

$173,487,474

5,265,173.72%

-1

6

Cleveland Int’l Airport

$ 163,746,482

$27,321,391

20.03%

-$11,633,815

-6.63%

1

7

Buffalo-Niagara Falls, N.Y. (border crossing)

$ 43,306,177

$610,336

1.43%

$36,036,776

495.73%

-1

8

New Orleans Int’l Airport

$ 32,274,442

-$20,121,532

-38.40%

$1,342,677

4.34%

1

9

Anchorage Int’l Airport

$ 11,741,932

-$7,081,440

-37.62%

-$2,338,259

-16.61%

2

10

Philadelphia Int’l Airport

$ 9,480,595

-$1,078,704

-10.22%

$1,090,714

13%

0

11

San Francisco Int’l Airport

$ 9,469,270

-$8,262,661

-46.60%

$123,994

1.33%

8

12

Minneapolis-St. Paul Int’l Airport

$ 8,682,929

$4,705,711

118.32%

$8,642,077

21,154.60%

8

13

Dallas-Fort Worth Int’l Airport

$ 7,842,077

$3,983,679

103.25%

$7,842,077

NA

1

14

Blaine, Wash. (border crossing)

$ 7,022,818

-$606,896

-7.95%

-$560,671

-7.39%

1

15

Port of Los Angeles

$ 6,185,735

-$124,085

-1.97%

$6,185,735

NA

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

  Comments