Weak Start To 2024 For UK Exports

Responding to the yesterday's Office for National Statistics data on UK trade for January, William Bain, Head of Trade Policy at the BCC, said:

“There was a slow start to the year in export volumes for both goods and services, with a modest rise in volumes of goods imports. But the UK is not alone in experiencing this, with US and major European markets experiencing similar trends.

“While there are several global factors at play in this, it was interesting that the ONS did not detect any impact in terms of Red Sea disruption on imports.

“UK firms remain keen to see a more effective delivery of the government’s Exports Strategy to help them stay competitive. This means taking steps to secure supply chains through critical minerals agreements with key partners, and a reduction in the costs of doing trade with our key export markets.”

In-depth analysis

The start of 2024 saw a further drop in goods exports, but an increase in imports. Services trade was broadly flat for January, but this was an improvement on the decline in these exports, to the tune of 4%, which marked the final quarter of 2023.

Goods Exports

On the chained volumes measure, which removes the effects of inflation, Overall, UK goods exports fell by 2.2% (£0.5bn) in January compared to December. Goods exports to non-EU countries fell by 4.3% (£0.6bn) but this was offset by goods exports to the EU - which increased by just under £0.1bn. The value of fuel and chemicals exports to the EU rose during January, offset by lower values of exports in machinery and transport equipment, including cars and aircraft.

Goods Imports

After removing the effects of inflation, goods imports were up by 1.8% (£0.7bn) month on month, led by an increase in non-EU goods imports of 4.8% (£0.8bn), including a modest rise in clothing imports from China and Bangladesh. However, EU goods imports declined by 0.4% (£0.1bn), although the value of fuel and food imports increased.

Services

Services imports and exports increased very slightly by £0.1bn apiece in January, on the chained volumes measure, with rises of around 0.4% for both.