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Electronic Products

John VerWey

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Change from 2017 to 2018:

  • U.S. total exports of electronic products: Increased by $8.4 billion (3.1 percent) to $277 billion
  • U.S. general imports of electronic products: Increased by $21.9 billion (4.5 percent) to $506 billion

From 2017 to 2018, U.S. total exports of electronic products grew by $8.4 billion (3.1 percent) to $277 billion. During the same period, U.S. electronic products exports increased overall,[1] rising by $2.5 billion (1.5 percent) to $162.5 billion, though there were decreases in a few sectors. The growth in exports was due primarily to an increase in exports of measuring, testing, and controlling instruments as well as medical goods. U.S. exports to China posted the largest growth by value, while those to Thailand posted the largest growth by percentage change (table EL.1).

From 2017 to 2018, U.S. imports of electronic products grew by $21.9 billion (4.5 percent) to $506 billion. The growth in imports was due primarily to an increase in imports of computers, peripherals, and parts as well as medical goods. U.S. imports of electronic products from Mexico increased the most (up $6.9 billion, 9.2 percent), followed by those from China ($4.4 billion, 2.1 percent).

Table EL.1 Electronic products: U.S. exports and general imports, by selected trading partners, 2014–18

 
Million $
 

Item

2014
2015
2016
2017
2018
Absolute change,
2017–18
Percent
change,
2017–18
U.S. total exports:
 

China

14,538

15,184

14,957

14,932

16,374

1,442

9.7

Mexico

21,691

23,295

21,057

19,726

19,169

-558

-2.8

Malaysia

5,221

5,146

4,743

4,733

4,001

-732

-15.5

Japan

10,154

9,583

9,391

9,138

9,223

85

0.9

Canada

17,548

15,907

15,348

15,659

15,908

249

1.6

Germany

8,235

8,199

8,083

8,571

8,867

296

3.5

South Korea

6,856

7,270

6,575

7,148

7,251

103

1.4

Taiwan

3,736

4,229

4,883

4,709

4,787

78

1.7

Thailand

2,355

2,245

2,315

2,120

2,413

293

13.8

Vietnam

696

723

2,060

1,504

1,039

-465

-30.9

All other

78,350

74,380

70,627

71,854

73,517

1,663

2.3

Total domestic exports

169,379

166,162

160,040

160,093

162,549

2,455

1.5

Foreign exports

98,455

97,959

100,386

108,452

114,347

5,895

5.4

Total U.S. exports (domestic and foreign)

267,833

264,121

260,426

268,546

276,896

8,350

3.1

U.S. general imports:

 

 

 

 

 

 

 

China

186,705

189,224

180,381

205,604

209,957

4,353

2.1

Mexico

65,064

72,485

73,501

75,760

82,745

6,985

9.2

Malaysia

22,089

25,373

28,544

28,274

29,272

999

3.5

Japan

22,906

21,686

21,214

21,514

22,585

1,072

5.0

Canada

9,114

8,939

8,927

9,286

9,807

521

5.6

Germany

15,256

14,851

14,431

14,986

16,601

1,616

10.8

South Korea

17,379

16,169

16,551

16,813

17,561

747

4.4

Taiwan

17,343

16,330

16,435

17,625

18,980

1,355

7.7

Thailand

12,341

13,343

13,534

13,999

13,775

-225

-1.6

Vietnam

5,579

9,810

11,704

12,360

12,198

-163

-1.3

All other

65,332

61,669

64,639

67,908

72,589

4,682

6.9

Total general imports

439,109

449,879

449,861

484,129

506,070

21,942

4.5

Source: Compiled from official statistics of the U.S. Department of Commerce.
Note: Import values are based on U.S. customs value; export values are based on free alongside ship value, U.S. port of export. Calculations are based on unrounded data. The countries are sorted by those with the largest total U.S. trade (U.S. general imports plus U.S. domestic exports) in these products in the most recent year.

 

U.S. Exports

U.S. total exports of electronic products grew by $8.4 billion (3.1 percent) to $277 billion in 2018. Likewise, U.S. electronic products exports increased by $2.5 billion (1.5 percent) to $162.5 billion. An increase in exports of measuring, testing, and controlling instruments as well as of medical goods drove the growth in exports in 2018 (table EL.2). U.S. exports to China posted the largest growth by value, increasing by $1.4 billion (9.7 percent), while those to Thailand grew the most in terms of percentage change, increasing by $293 million (13.8 percent).

From 2017 to 2018, U.S. exports of measuring, testing, and controlling instruments increased by $1.8 billion (7.8 percent) to $24.9 billion (table EL.2). This increase primarily involved exports to China, Germany, and Taiwan. Within this product group, the largest increases in U.S. exports involved scientific measuring instruments,[2] up $137 million, and medical devices such as x-ray machines,[3] up $128 million. China was the largest export destination for both of these product groups, due in part to increased demand stemming from changes in Chinese demographics and government policies, as well as swift-moving advances in technology. These changes have resulted in rapid reforms in its healthcare sector and large industrial upgrading initiatives such as Made in China 2025, which rely on a variety of measuring, testing, and controlling instruments.[4]

U.S. exports of medical goods rose by $1.6 billion (4.9 percent) to $34.4 billion in 2018. This increase was primarily in exports to the Netherlands, Japan, and China. Within this product group, the largest increases in U.S. exports were of healthcare products such as catheters,[5] up $530 million, and medical, surgical, and dental instruments,[6] up $226 million. Again, China, the Netherlands, and Japan have been the top three export destinations for these two product groups for the past five years.[7] U.S. exports of these goods to China grew by roughly $500 million for both of these groups between 2013 and 2018, driven in part by the reforms in its healthcare sector and large industrial upgrading initiative previously mentioned.[8]

Table EL.2 Electronic products: Leading changes in U.S. exports and imports, 2014–18

 
Million $
 

Item

2014
2015
2016
2017
2018
Absolute change,
2017–18
Percent
change,
2017–18
U.S. total exports:
 

Increases:

 

 

 

 

 

 

 

Measuring, testing, and controlling instruments (EL025)

25,714

23,928

22,602

23,050

24,859

1,809

7.8

Medical goods (EL022)

33,727

33,204

32,932

32,787

34,392

1,605

4.9

Decreases:

 

 

 

 

 

 

 

Telecommunications equipment (EL002)

17,099

17,556

16,665

15,726

14,985

-741

-4.7

Semiconductors and integrated circuits (EL015)

27,446

27,744

27,895

26,531

26,067

-464

-1.7

All other

65,392

63,731

59,944

62,000

62,245

245

0.4

Total

169,379

166,162

160,040

160,093

162,549

2,455

1.5

U.S. general imports:

 

 

 

 

 

 

 

Increases:

 

 

 

 

 

 

 

Computers, peripherals, and parts (EL017)

121,512

119,620

112,561

124,073

138,092

14,019

11.3

Medical goods (EL022)

36,182

37,826

40,158

42,985

47,343

4,358

10.1

Decreases:

 

 

 

 

 

 

 

Telecommunications equipment (EL002)

98,289

105,055

107,863

116,116

111,973

-4,143

-3.6

Semiconductors and integrated circuits (EL015)

39,037

40,134

44,177

43,971

43,609

-362

-0.8

All other

144,089

147,244

145,102

156,983

165,053

8,069

5.1

Total

439,109

449,879

449,861

484,129

506,070

21,942

4.5

Source: Compiled from official statistics of the U.S. Department of Commerce.
Note: Import values are based on U.S customs value; export values are based on free alongside ship value, U.S. port of export. Calculations are based on unrounded data.

Although U.S. exports of electronics products increased by $2.5 billion between 2017 and 2018, there were declines in exports of telecommunications equipment of $741 million (4.7 percent) to $14.9 billion, and in those of semiconductors and integrated circuits of $464 million (1.7 percent) to $26 billion. The largest decrease in exports of telecom equipment was in communication satellites,[9] down $464 million, and cellphones,[10] down $334 million. The largest decrease in exports of semiconductors and integrated circuits was in integrated circuits and systems on a chip,[11] down $482 million, and memory chips,[12] down $366 million. U.S. exports of electronic products to Malaysia and Vietnam saw the largest decrease in percentage and value.

As discussed further below, the decrease in U.S. exports of semiconductors and integrated circuits coincided with a decrease in U.S. imports of semiconductors and integrated circuits, reflecting a general downward production trend in the global semiconductor industry in the second half of 2018 as prices of memory chips fell due to oversupply. The semiconductor industry is subject to well-documented cyclical behavior, and a downturn beginning in the fourth quarter of 2018 led to a period of decreasing sales and orders as companies processed their existing inventory and certain subsegments of the market experienced oversupply.[13] Industry analysts also stated that U.S. firms that produce semiconductors, particularly manufacturers of memory chips, saw a decrease in sales to China after the various trade actions put in place by the United States and China.[14]

 

U.S. Imports

U.S. imports of electronic products grew by $21.9 billion (4.5 percent) to $506 billion in 2018. The growth in imports was due primarily to an increase in imports of computers, peripherals, and parts as well as medical goods (table EL.2). U.S. imports of electronic products from Mexico increased the most ($7.0 billion, 9.2 percent), followed by those from China ($4.4 billion, 2.1 percent).

In 2017–18, U.S. imports of computers, peripherals, and parts increased from $124 billion to $138 billion ($14 billion, 11.3 percent). Within this product group, the largest increases in U.S. imports were of desktop computers and servers,[15] up $8.2 billion (35 percent) and printed circuit board assemblies,[16] up $4.7 billion (27 percent), reflecting increased U.S. demand for these products. Printed circuit board assemblies are incorporated in nearly all electronic devices, including computers, servers, and phones, as well as in cloud computing.[17] Mexico—which benefits from a well-educated and growing population and low labor costs, proximity to the United States, and large U.S. consumer electronic firms—has emerged as a hub for electronics assembly and manufacturing in recent years. China remains a major location for the manufacture and assembly of intermediate and final electronic products.[18]

U.S. imports of medical goods increased from $43.0 billion to $47.3 billion (10.1 percent) from 2017 to 2018, reflecting growing demand for healthcare services.[19] Within this product group, the largest increases in U.S. imports were of medical, surgical, and dental instruments,[20] up $940 million, and prosthetics,[21] up $411 million. Imports of medical, surgical, and dental instruments from Mexico totaled $2.1 billion in 2018, while Ireland was the leading supplier of prosthetics, totaling $1.5 billion in 2018.[22] Both countries feature large and growing medical device industries bolstered by the availability of cost-competitive (Mexico) and skilled (Ireland) labor pools, transportation infrastructure, and tax preferences.[23]

From 2017 to 2018, the electronic product sectors that recorded the most notable declines in imports were telecommunications equipment, and semiconductors and integrated circuits. U.S. imports of telecom equipment declined by $4.1 billion (3.6 percent) to $112 billion. Within the telecommunications product group, imports of cellphones declined $3.1 billion and imports of radio transceivers were down $808 million. U.S. imports of telecom equipment declined the most from South Korea, Malaysia, and China. Major electronics manufacturers maintain facilities in South Korea (e.g., Samsung), Malaysia (e.g., Murata), and China (e.g., Foxconn).[24] After several years of increases, industry analysts predict slower growth in demand for telecommunications equipment in the upcoming years, which partially explains the decline in imports of these products.[25]

Meanwhile, imports of semiconductors and integrated circuits declined by $362 million (0.8 percent) to $43.6 billion. Within the semiconductors and integrated circuits product group, the largest decrease in imports by value was of diodes,[26] down $2 billion, and LEDs,[27] down $97 million. Imports of semiconductors and integrated circuits declined the most from Ireland, Vietnam, and Israel. The U.S. chipmaker Intel maintains manufacturing facilities in Ireland and Israel, which account for the majority of U.S. imports from those countries.[28] The decline in imports of semiconductors and integrated circuits from Ireland, Vietnam, and Israel also partially reflects the downturn that this industry now faces.[29]

 

[1] Unless otherwise noted, the export data used in this investigation are for domestic exports. For more information on trade terminology, please refer to USITC, “Special Topic: Trade Metrics,” Shifts in U.S. Merchandise Trade, 2014, 2015, https://www.usitc.gov/research_and_analysis/trade_shifts_2014/trade_metrics.htm.

[2] USITC DataWeb/USDOC, HTS 9015.80.80 (accessed May 29, 2019). HTS 9015.80.80 covers surveying, hydrographic, oceanographic, hydrological, meteorological or geophysical instruments and appliances, not elsewhere specified or included (n.e.s.i.), nonoptical.

[3] USITC DataWeb/USDOC, HTS 9030.10.00 (accessed May 29, 2019). HTS 9030.10.00 covers instruments and apparatus for measuring or detecting ionizing radiations.

[4] Seeking Alpha, “China Sector Analysis: Health Care,” 2019; U.S. Chamber of Commerce, Made in China 2025, March 16, 2017.

[5] USITC DataWeb/USDOC, HTS 9018.39.00 (accessed May 29, 2019). HTS 9018.39.00 covers catheters, cannulae and the like, n.e.s.i., used in medical, surgical, dental or veterinary sciences, and parts and accessories thereof.

[6] USITC DataWeb/USDOC, HTS 9018.90.80 (accessed May 29, 2019). HTS 9018.90.80 covers instruments and appliances used in medical, surgical, dental or veterinary sciences, n.e.s.i., and parts and accessories thereof.

[7] IHS Markit, Global Trade Atlas database, HS 9018.39 and 9018.90 (accessed May 29, 2019).

[8] Seeking Alpha, “China Sector Analysis: Health Care,” 2019.

[9] USITC DataWeb/USDOC, HTS 8802.60.30 (accessed May 29, 2019). HTS 8802.60.30 covers communication satellites.

[10] USITC DataWeb/USDOC, HTS 8517.12.00 (accessed May 29, 2019). HTS 8517.12.00 covers telephones for cellular networks or for other wireless networks.

[11] USITC DataWeb/USDOC, HTS 8542.31.00 (accessed May 29, 2019). HTS 8542.31.00 covers processors and controllers, whether or not combined with memories, converters, logic circuits, amplifiers, clock, and timing circuits.

[12] USITC DataWeb/USDOC, HTS 8542.32.00 (accessed May 29, 2019). HTS 8542.32.00 covers memories.

[13] Witkowski, “Chip Companies Face Worst Downturn in a Decade,” 2019.

[14] IDC, “Worldwide DRAM Market Shares, 2018,” 2019, 5.

[15] USITC DataWeb/USDOC, HTS 8471.50.01 (accessed May 29, 2019). HTS 8471.50.01 covers processing units other than those of subheading 8471.41 and 8471.49, not elsewhere specified or included (n.e.s.o.i).

[16] USITC DataWeb/USDOC, HTS 8473.30.11 (accessed May 29, 2019). HTS 8473.30.11 covers printed circuit assemblies, not incorporating a cathode ray tube, of the machines classified in HTS 8471.

[17] CTA, “Comment on Section 301 Tariffs,” 2018, 5.

[18] Donahue, “Mexico: A New Hub for Electronics Manufacturing,” 2018; Torsekar and VerWey, “EAP’s Participation in Electronics GVC,” 2019.

[19] AMN Healthcare, “Healthcare Industry Forecast: High Demand,” 2017.

[20] USITC DataWeb/USDOC, HTS 9018.90.80 (accessed May 29, 2019). HTS 9018.90.80 covers instruments and appliances used in medical, surgical, dental or veterinary sciences, n.e.s.i., and parts and accessories thereof.

[21] USITC DataWeb/USDOC, HTS 9021.31.00 (accessed May 29, 2019). HTS 9021.31.00 covers artificial joints and parts and accessories thereof.

[22] USITC DataWeb/USDOC, HTS 9021.31.00 (accessed May 29, 2019).

[23] Araiza Diaz, “Medical Device Industry in Mexico,” 2018; Keena, “Ireland Second Only to Germany,” 2018.

[24] Samsung, “Manufacturing Centers,” 2019; Murata Group, “About Murata Malaysia,” 2019; Hille, “Foxconn: Why the World’s Tech Factory Faces Its Biggest Tests,” June 10, 2019.

[25] S&P Global Ratings, “Industry Top Trends 2019: Telecommunications,” November 15, 2018.

[26] USITC DataWeb/USDOC, HTS 8541.40.60 (accessed May 29, 2019). HTS 8541.40.60 covers diodes for semiconductor devices, other than light-emitting diodes, n.e.s.i.

[27] USITC DataWeb/USDOC, HTS 8541.40.20 (accessed May 29, 2019). HTS 8541.40.20 covers light-emitting diodes (LEDs).

[28] Both facilities expect to expand in the coming years in spite of the declines in trade in 2018. Clarke, “Intel Plans for More Manufacturing,” 2018.

[29] Jewell, “Semiconductor Market Downturn in 2019,” 2019.

Bibliography — Electronic Products

AMN Healthcare. “Healthcare Industry Forecast: High Demand due to Aging, Economy,” 2017. https://www.amnhealthcare.com/latest-healthcare-news/healthcare-industry-forecast/.

Araiza Diaz, Ruben. “Medical Device Industry in Mexico a Niche of Opportunities.” Swiss Business Hub Mexico, August 9, 2018. https://www.s-ge.com/en/article/global-opportunities/20183-c6-mexico-life-sciences-opportunities-medical-devices.

Clarke, Peter. “Intel Plans for More Manufacturing in Ireland, Israel, Oregon.” eeNews Europe, December 18, 2018. https://www.eenewseurope.com/news/intel-plans-more-manufacturing-ireland-israel-oregon.

Consumer Technology Association (CTA). “Consumer Technology Association Public Comment on Federal Register Docket Number USTR-2018-0026,” September 6, 2018.

Donahue, Doug. “Mexico: A New Hub for Electronics Manufacturing.” SMT007, September 25, 2018. https://smt.iconnect007.com/index.php/article/112848/mexico-a-new-hub-for-electronics-manufacturing/112851/?skin=smt.

Hille, Kathrin. “Foxconn: Why the World’s Tech Factory Faces its Biggest tests.” Financial Times, June 10, 2019. https://www.ft.com/content/0f57109e-8845-11e9-a028-86cea8523dc2

IHS Markit, Global Trade Atlas database (accessed various dates).

International Data Corporation. “Worldwide DRAM Market Shares, 2018: Facing Correction,” 2019. https://www.idc.com/getdoc.jsp?containerId=US45068419.

Jewell, Bill. “Semiconductor Market Downturn 2019.” SemiWiki, March 23, 2019. https://semiwiki.com/design-services/semiconductor-intelligence/8077-semiconductor-market-downturn-in-2019/.

Keena, Colm. “Ireland Second Only to Germany for Medical Device Exports.” Irish Times, 2018. https://www.irishtimes.com/news/ireland/irish-news/ireland-second-only-to-germany-for-medical-device-exports-1.3708077.

Murata Group. “About Murata Malaysia,” 2019. https://www.murata.com/en-sg/about/asean/malaysia

S&P Global Ratings. “Industry Top Trends 2019: Telecommunications,” November 15, 2018. https://www.spratings.com/documents/20184/5670590/Industry+Top+Trends+-+Telecommunications/3cd48091-6df7-3a2d-ac31-c2a376745c15.

Samsung. “Manufacturing Centers,” 2019. https://www.samsung.com/semiconductor/about-us/location/manufacturing-centers/.

Seeking Alpha. “China Sector Analysis: Health Care,” April 30, 2019. https://seekingalpha.com/article/4258126-china-sector-analysis-health-care.

Torsekar, Mihir, and John VerWey. “The East Asia-Pacific’s Participation in the Global Value Chain for Electronic Products.” Journal of International Commerce and Economics, March 2019. https://www.usitc.gov/publications/332/journals/east_asia-pacifics_participation_in_the_global_value_chain_for_electronic_products.pdf.

U.S. Chamber of Commerce. Made in China 2025: Global Ambitions Built on Local Protections, March 16, 2017. https://www.uschamber.com/report/made-china-2025-global-ambitions-built-local-protections-0.

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Witkowski, Wallace. “Chip Companies Face Worst Downturn in a Decade, Analysis Contends.” MarketWatch, May 3, 2019. https://www.marketwatch.com/story/chip-companies-face-worst-downturn-in-a-decade-analysis-contends-2019-05-03.