Global exports of intermediate goods, such as parts and components, increased by 20 per cent year-on-year in the first quarter of 2021 according to a new World Trade Organization (WTO) quarterly report.
The report, aimed at helping track the health of global supply chains shows that the increase sustains the upward trend in intermediate goods. This follows the sharp decline in the second quarter of 2020.
Based on the available data, Asia recorded the highest growth in exports of intermediate goods in the first quarter, representing 28% of growth in exports. This growth was due to a 41% increase in Chinese exports of industrial intermediate goods, the report notes. The category of intermediate goods mainly included parts for information communication technology equipment and photovoltaic cells.
Similarly, for Africa, exports increased by 27%, mostly driven by a 38% increase in exports to China. These goods were mainly ores, copper, diamonds and an 84% increase to India, mostly gold. More so, North American goods grew the least at 11%.
Australian intermediate goods exports also experienced large increase of 61%. This was mainly from iron ore concentrates used by the steel industry which represented nearly 60% of the country’s intermediate exports.
Likewise, Italy saw an increase in intermediate goods exports of 18%. This was mainly due to shipments of automotive parts and precious metals, namely gold and platinum group metals to Germany and Switzerland.
Furthermore, the most resilient supply chains in the first quarter were ores, precious stones and rare earths. Also, exports increased by 43% in the first quarter. Also, food and beverages went up by 22% during the period under review.
Major imports of intermediate goods
In contrast, exports of transport parts and accessories realized the weakest recovery at 6%. This follows steep declines in 2020 as the pandemic affected both demand for and production of automotives.
Moreover, a separate information note is further provided on world trade in 2020 of platinum group metals (PGMs). This is a commodity used in electronic components and catalytic converters to treat automobile exhaust emissions, and other industries.
Accordingly, platinum group metals accounted for around 2% of ores, precious stones and rare earths exported in 2020. Also, they are strategic inputs for many industries.
Apart from the exports, China was the main purchaser of intermediate goods. China’s imports grew by 37%, reflecting the dynamic recovery of the economy.
India was a major intermediate goods importer of 49%. This is due essentially to shipments of electrical and electronic parts from Chinese companies. This was also as a result of raw diamonds and gold materials from Switzerland and the United Arab Emirates.
Italy, the first country in Europe to be hit by the health crisis, had the strongest European growth in intermediate imports. This is especially of diagnostic and laboratory reagents from European companies.
Trade statistics on intermediate goods reflect the international exchanges of parts, components, accessories used to produce final products and serve as an indicator of the activity in supply chains.
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