Exports Remain Bright Spot
Back in March, we talked about the export market, with the fall of the American dollar, to be the one bright spot in the American economy. With the fall of the real estate market, high gasoline prices and, now with the bankruptcy of Lehman Brothers, the purchase of venerable Merrill Lynch by Bank of America and the tottering of AIG, free trade and the booming export market are, indeed, beginning to become the backbone of the American economy.
And now, The Wall Street Journal seems to be catching up with the Shortliner. In a front page article of its Sept. 11 edition headlined “Exports Prop Up Local Economies,” the paper highlights what this market is now meaning in towns across the country. Not only are export powerhouses like Deere, Cummins Inc., Boeing and Caterpillar featured, but small actors like B&G Machine Inc., a rebuilder of diesel engines in Seattle, Normacore LLC, a manufacturer of plastic corks for wine bottles in Zebulon, NC, D’Addario & Co., a small maker of guitar and violin strings in Farmingdale, NY, and Marlin Steel Wire Products LLC, a manufacturer of wire baskets in Baltimore, are also covered.
As the article stated, export demand in the U.S. is becoming so great that many inland companies are having difficulties locating metal shipping containers to ship their products overseas. As Daniel J. Meckstroth with the Manufacturers Alliance/MAPI, a Virginia-based research firm says, “Exports are impacting, in a positive manner, virtually every industry and every state.” The article goes on to state that exports have risen $115 billion in the past year or 12% across every major category. Exports are now accounting for 13.5% of American GDP, the highest percentage since World War II.
Emphasis is given to the booming export market for ag commodities. In turn, this has provided needed relief in the Midwestern U.S. to all kinds of suppliers to the ag market. (Guess where we come in?)
The article went on to state that, “exports have become a key to greater local prosperity more than at any time in decades.” Referring to smaller communities across the U.S., the paper said, “These out-of-the-way places have become trade hot spots as the U.S. exports, fueled by the dollar’s fall, continue to provide a rare spark in an otherwise gloomy economy.”
A day later (Sept. 12), The Wall Street Journal headlined another article, “Exports Keep Driving U.S. Growth.” While the article talked about the widening trade deficit in the U.S. lengthened due to rapidly rising fuel prices, it also reported that exports in the month of July grew by $5.4 billion.
Some specialized manufacturers may be thinking, “It’s only the Deere’s, Case-IH’s and Caterpillars that can take advantage of a thriving export market.” But as the Wall Street Journal article of Sept. 11th indicated, EVERYONE, big and small are now taking advantage of this surging market. What with the dollar now being cheaper than foreign currencies and with the high demand for agricultural products, what time could be better than to dip your toes in?
This year’s Fall Convention in Reno, Nov. 5-8, can be the perfect introduction into the export market. Subjects like “Building Productive Trade Alliances in a Turbulent Business World” and the CE mark — something like the Good Housekeeping Seal in Europe — can help you begin the road to exporting excellence.
Perhaps even better — networking with peers — might give you a better insight into “how they did it.” Many FEMA Marketing Members covering the export market can be viewed on the FEMA website (www.FarmEquip.org) where under “Member Resources” you can simply click on distributors outside of the U.S.
For years, FEMA has been touting the export market. Indeed, some members have started to look at marketing in distant lands just like they look at the domestic market. We can promise, though, that the U.S. market will not always be as good as it now is. With the fall of the U.S. dollar, could there be a better time than now to begin looking outside U.S. borders?