May 2007

Real Texas exports retrenched in first quarter 2007, edging down 3.3 percent, following five successive quarters of robust growth. Recent weakness in the economies of Texas’ largest trading partners spurred the decline. Despite the modest contraction, Texas exports are 7.4 percent above year-ago levels.

The first-quarter decline in Texas export growth was widespread across Texas’ major trading partners, with China registering the only increase (14.6 percent) (Chart 1). Exports to Mexico and Canada, which together account for nearly half of the state’s exports, fell 3.7 and 2 percent, respectively. Texas exports to Latin America (excluding Mexico), Asia (excluding China) and the European Union also registered declines of 6.6 percent, 6.3 percent and 4.7 percent, respectively.

Chart 1

Looking at exports by industry, only chemical exports witnessed an increase (7.5 percent) during the quarter (Chart 2). Computer and electronics exports edged down for the second consecutive quarter, declining 7.9 percent. Exports of transportation equipment and industrial machinery fell 9.7 percent and 1.1 percent, respectively, although exports of both remain above last year’s levels. Year-to-date, the top ten Texas commodities exported (in terms of dollar value) are chemicals, computer and electronic products, nonelectrical machinery, transportation equipment, petroleum and coal products, electrical equipment, primary metals, fabricated metals, agricultural products and food and kindred products.

Chart 2

Notes All data used in this analysis have been seasonally adjusted. Growth rates are not annualized unless otherwise noted. The source for quarterly export data is the World Institute for Strategic Economic Research (WISERTrade). For additional information or questions, please contact Laila M. Assanie at 214-922-5191.