Reacting to the latest ONS Trade data for January, William Bain, Head of Trade Policy at the BCC, said:
“There was no big boost to trade volumes to start 2023. Removing cyclical factors in the trade data, goods export volumes to both the EU and rest of the world, over the past year, have remained constant.
“But goods trade values fell in January. On the imports side this can be partly explained by balancing it against the stronger performance in machinery and transport orders in December.
“The overall picture over the past three months indicates no upward tick – with total goods import values down by 1.6% in the 3 months to January 2023, compared with the 3 months before then, and goods export values down by 4% over the same timeframe.
“Services were only moderately better – with import values down by 0.3% over that period and export values down by 2.3%.
“It is clear that cost of living pressures are hitting consumer incomes globally and this is widely forecast to be a drag on global trade in 2023.
“Today’s data provides further signals that UK exporters require a year of strong delivery from the UK Export Strategy to provide ballast to their ambitions in 2023.”
Analysis of the data:
Trade values for goods (excluding inflation) fell in January, with imports down 9.3% on December and goods exports down 1.8%.
Services export values were down by 0.6% on the previous month, once inflationary effects were removed. Over the past 12 months, the volume of UK exported goods has been relatively flat.
There was a fall in goods export values to the EU of 4.2% (driven by lower fuels, chemicals and material manufactured goods exports). This was only partially offset by a rise in goods export values to the rest of the world by 0.9% (largely in higher chemicals exports to the US and pharmaceutical exports to South Korea).
Total goods imports values fell by 11.4% from the EU (decreases in machinery and transport equipment) and 6.7% from the rest of the world.
In services, excluding inflation, import values fell by 0.3% while export values fell by 0.6% in January compared with the previous month.
More detail on the ONS data can be found here.