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Exports Experienced a Downturn in August



Recent trade stats from the Office for National Statistics (ONS) clearly showed how export of goods saw a decline compared with previous months and services maintain a flat performance.


In terms of export of goods, the Chamber also observed that export consignment values, through the documentation services we offered to exporters, dropped in August to the lowest point since April 2023, although this was very very similar to the same values we saw for the previous year. Cumulatively though, whilst exports have reached c.£336m YTD – 16% higher than the same period last financial year, we are still a long way from the levels achieved back in 2019/2020 where we had reached approximately £419m.


Recent surveys from our events and training courses showed a majority of traders have slowly but surely adapted to the new rules of trading since the UK exited the EU, but there are still an important number of companies out there finding it either moderately or very difficult trade in goods and services as well as movement of people.


Susana Córdoba, Head of International Trade at Greater Manchester Chamber said: “Current data from our documentation services shows a recovery in terms of export of goods compared with 2022/23, but we are still behind from export levels achieved back in 2019/20. With the introduction of new regulations as part of the new UK Border Targeted Operating Model (BTOM), recent surveys show there is a majority of companies in the UK who are unprepared for these. We have also seen a general lack of awareness and more practical information and advice regarding the new EU’s Carbon Border Adjustment Mechanism (CBAM) and how this will affect UK exporters when selling to the EU.


"Companies need more support in dealing with these regulatory changes as much as efforts are being invested into export promotion. Trade Missions, Meet the Buyer programmes and connecting companies with global opportunities are definitely paramount to achieving £1tn of exports, but equally, providing assistance to traders to adapt to new customs rules is very important for a holistic exporting success for Greater Manchester businesses and the whole UK."


Reacting to the latest Office for National Statistics data on Trade, William Bain, Head of Trade Policy at the BCC, also said: “August was not a good month for UK goods exports. There were falls in both EU and rest of the world trade - where after removing the effects of inflation, volumes fell by 7.2% month on month.


“The export gains of July went into reverse during August, which brings the UK more into line with the global trade picture for June-July this year.  

“On the services front, it was another broadly flat month for UK exports – suggesting that the growth in overseas demand for services from last year is not being sustained. This may be a function of weaker than expected global economic conditions, especially in consumer spending.  


“The overall picture on UK goods exports volumes to the EU has been flat over the last 18 months, when you remove the effects of inflation. The BCC has recommended several areas where this could be addressed, including a veterinary deal, youth mobility schemes, and improved conditions for firms on VAT compliance and fiscal representatives.”  


In Depth Analysis


There was a 4.6% fall in UK goods export chained volumes (the measure which removes the effects of inflation) on the previous month, and a 1.1% decline in goods imported. The trade deficit increased slightly by £0.3bn to £12.7bn in the three months to the end of August. 

Goods export volumes to the EU declined by 1.8% month on month, and to the rest of the world by 7.2% month on month. Goods imports volumes from the EU fell by 3.2% from July but import volumes from the rest of the world rose by 1.7%. 


Estimated UK services export performance remained flat for a further month – on both the chained volumes and current value measures.  


Imports


The fall in goods imports from the EU was driven by reduced chemical, machinery, transport equipment and manufactured goods imports. Fuel imports rose slightly compared with July 2023. A rise in non-EU goods imports was down to increased gas imports from Norway, and higher levels of manufactured goods from China. 


Exports


Exports of drink, tobacco and other manufactured goods fell slightly to the EU during August 2023. Exports to the rest of the world experienced downward pressures in August in the chemicals, machinery, cars (to US and China) and fuels sectors.

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