Data published by the Central Bureau of Statistics on Foreign Trade in Latvia show that the export value of goods fell in September for the first time in the last six months. Although the value of exports of goods in September was mainly high and exceeded one billion euros, which is more than in the other months of this year, export of goods was 1% lower than in September last year.
The decline in small total exports of FM was explained by the previously forecast reduction in cereal and rapeseed exports, due to poor cereals, as well as the reduction of re-exports for certain electrical equipment and mechanical devices. "Excluding the decline in exports of these goods, total exports in September would be 3.9% higher than in September of the previous year," the ministry added.
In September, the biggest negative impact on the change in the export value of goods was recorded for a group of agricultural and food products, especially due to the fall in exports of cereals and rapeseed. Traditionally, the largest number of cereals and rape exports can be seen in the autumn months, but in September this year the export value of these goods was 3.8% and 76.8% compared to the same month of the previous year.
"The unpredictable dry weather in Latvia this year has negatively affected the harvest volume, which also has an impact on export data, and it is likely that the export value of these goods will be lower than in the other autumn months." Total declines in exports of agriculture and food in September this year it was 11.5%, "FM said.
The decline in exports in September was somewhat compensated by the increase in exports of wood and wood products by 17.7%, under the influence of increased exports of logs to Estonia and the United Kingdom, as well as the increase in exports of unmanufactured timber to Sweden.
"Despite the fact that the export of timber industry to the timber industry has reached the highest export value since 1995, this export group of goods was the main driving force of exports in the first nine months of 2018 and the biggest contribution to the growth of exports. nine months increased by 8.3% compared to the same period of the previous year, and slightly more than a third is the export earnings of exports of wood, "the ministry said.
Among other commodity groups affected by export changes in September, FM recorded an increase of 8.7% in exports of chemical products related to the growth of drug exports to Lithuania. The increase in exports of metals by 7.9% was conditioned by the increase in exports of iron and steel to Turkey, as well as the increase in exports of iron and non-alloy steel and rods to the countries of the European Union (EU).
"In assessing the prospect of developing Latvian exports in the medium term, negative risks have intensified since the beginning of this year, and export growth may be limited by the uncertainty surrounding the global environment in connection with the rise in protectionist world trade. The mood of EU entrepreneurs remains very high, the dynamics of the last months has been declining and the economic value of the mood index in October this year has reached the lowest level since the middle of last year. In addition, the assessment of the state of goods in Latvia in the fourth quarter This was slightly worse compared to the previous quarters, "the ministry said.
Similarly, FM acknowledged that the factors that affected the drop in exports in September were not related to the decline in external demand. However, the latest World Economic Outlook International Monetary Fund (IMF) report, which was renewed in October, recorded a decline in world trade by 0.6 percentage points for the current year to 4.2% against projections for this year. This is largely explained by the rise of the protectionist world trade.
"The IMF has already reduced the growth of world trade already in the previous economic forecasts that were re-established in July this year, leading to the conclusion that from the middle of this year only the intensified risks for foreign trade in the world have been intensified, therefore, the growth rate of exports of Latvian goods in the next months will be lower and will be lower than the average growth rate in the first nine months of this year, or 8.3%, "FM said.