UK trade: August 2018

• The total UK trade deficit (goods and services) narrowed £4.7 billion to £2.8 billion in the three months to August 2018.

• Removing the effect of inflation, the total trade deficit narrowed £6.1 billion to £0.8 billion in the three months to August 2018.

• A £3.5 billion narrowing of the goods deficit plus a £1.1 billion widening of the services surplus led to the £4.7 billion narrowing of the trade deficit in the three months to August 2018.

• The narrowing goods deficit was due mostly to falling imports of unspecified goods (including non-monetary gold) and rising fuels exports in the three months to August 2018.

• The trade in goods deficit narrowed £2.4 billion with the EU and £1.1 billion with countries outside the EU in the three months to August 2018.

• In the 12 months to August 2018, the total trade deficit narrowed £13.5 billion due to rises in exports for goods and services that were partially offset by corresponding rises in imports.

International Passenger Survey

Estimates derived from the International Passenger Survey (IPS) are used to help measure exports and imports of travel services. The International Passenger Survey (IPS) has recently transferred data collection from paper forms to tablet computers. While initial analysis of the new data found no detectible discontinuities, we are continuing to check the data. Therefore, headline trade and other national accounts estimates will continue to include some forecast data for exports and imports of travel services in the most recent periods. More information is available in the Overseas travel and tourism release.

Data revision policy

Services data in this release have been revised back to January 2017, which is in line with the quarterly national accounts and balance of payments, published on 28 September 2018. Trade in goods data have been revised for July 2018 only.

National Statistics designation status

The UK Statistics Authority suspended the National Statistics designation of UK trade (PDF 72.8KB) on 14 November 2014. We have now responded to all of the specific requirements of the reassessment of UK trade and are in the final stages of providing evidence to the Authority. We are undertaking a programme of improvements to UK trade statistics in line with the UK trade development plan, including more detail and improvements now published to address anticipated future demands. While delivering against this plan, we will continue to work with the Office for Statistics Regulation team to regain National Statistics status for UK trade statistics. We welcome feedback on this development plan.

Trade figures

Unless otherwise specified, data within this bulletin are in current prices.

Figure 1 shows the change to the goods, services and total trade balances along with exports and imports in the three months to August 2018, compared with the three months to May 2018.

The total UK trade deficit (goods and services) narrowed £4.7 billion to £2.8 billion in the three months to August 2018. Goods and services both contributed to the narrowing of the total deficit; the goods deficit narrowed £3.5 billion to £32.3 billion and the services surplus widened £1.1 billion to £29.4 billion.

Exports increased by more than imports for both goods and services in the three months to August 2018; goods exports increased £5.6 billion (6.6%) compared with £1.6 billion (2.2%) for services exports, while imports were up £2.1 billion (1.7%) compared with £0.4 billion (1.0%) for goods and services respectively.

The £3.5 billion narrowing of the goods deficit was due mostly to falling imports of unspecified goods (including non-monetary gold) and rising exports of fuels in the three months to August 2018. These were the two commodities that had the largest impact on the trade in goods deficit. There were a number of large export and import movements within other commodities that did not have a material impact on the deficit. This was due to them being offset by equally large movements in the opposite direction, that is, either exports or imports. Please see Section 6 in this release to see the largest goods export and import risers and fallers.

Figure 1: Change to UK trade balances, exports and imports, three months to August 2018 compared with three months to May 2018

Source: Office for National Statistics

Notes:

1. The arrow direction indicates whether a component has increased or decreased, while the colour denotes the impact the direction of a movement has on the trade balance.

2. For example, an increase in imports is denoted by an upward red arrow, as a rise in imports has a negative impact on the trade balance, while an increase in exports is denoted by an upward green arrow, as a rise in exports has a positive impact on the trade balance.

Download this image Figure 1: Change to UK trade balances, exports and imports, three months to August 2018 compared with three months to May 2018

.PNG (56.2 kB)

Figure 2 shows UK trade balances on a three-month on three-month basis between August 2016 and August 2018. The total trade deficit improved from £11.6 billion in the three months to August 2016 to £2.8 billion in the three months to August 2018 and has generally showed a narrowing trend over the past two years, albeit with some periods where the deficit has widened.

The closest the trade balance has come to being in surplus on a three-month comparison basis between August 2016 and August 2018 was in the three months to February 2018, when the deficit reached £2.0 billion.

Excluding erratic commodities (including non-monetary gold), the total trade deficit narrowed £3.0 billion to £4.3 billion in the three months to August 2018.

This section presents volume and price estimates of both the UK trade balance and trade in goods exports using chained volume measures (CVMs) and implied deflators (IDEFs). A CVM is a measure that has had the effect of inflation removed. An IDEF shows the implied change in average prices for the respective components of the trade balance.

Figure 3 shows CVMs for the UK trade balances, on a three-month on three-month basis, between August 2016 and August 2018.

Removing the effect of inflation, the total trade deficit (goods and services) narrowed £6.1 billion to £0.8 billion in the three months to August 2018. This is the ninth occasion the total deficit on a CVM basis has been less than £1.0 billion since recent records began in 1998.

Goods contributed most to the narrowing of the total deficit on a CVM basis, although services was also a factor in the three months to August 2018; the goods deficit narrowed £4.8 billion to £29.4 billion and the services surplus widened £1.3 billion to £28.6 billion.

Figure 4 shows CVMs and IDEFs for goods exports on a three-month on three-month basis between August 2016 and August 2018.

Removing the effect of inflation, goods exports rose £3.8 billion (4.9%) to £82.0 billion and this was the main factor in the £4.8 billion narrowing of the trade in goods deficit in the three months to August 2018; imports also helped to narrow the goods deficit, falling £1.0 billion (0.9%) to £111.4 billion.

The IDEF for trade in goods exports shows that prices rose by 1.7% in the three months to August 2018.

Figure 5 shows the change in goods exports, imports and the trade balances with EU and non-EU countries between the three months to August 2018 and the three months to May 2018.

The trade in goods deficit narrowed £2.4 billion with the EU and £1.1 billion with countries outside the EU in the three months to August 2018. Rising goods exports were the main factor for the narrowing of the deficit with both the EU and countries outside the EU, although falling goods imports from the EU also contributed.

In terms of the main contributors to the £2.4 billion narrowing of the goods deficit with the EU in the three months to August 2018, the fuels balance contributed £1.8 billion, due mainly to fuels exports rising £1.1 billion. Machinery and transport equipment also contributed £1.1 billion to the narrowing of the goods deficit, which was due mainly to falling imports of cars.

The main contributors to the £1.1 billion narrowing of the goods deficit with countries outside the EU were unspecified goods (including non-monetary gold), due mainly to falling imports, and chemicals (mostly medicinal and pharmaceutical products), due mainly to rising exports. Imports of unspecified goods fell £2.3 billion, while exports of chemicals increased £0.3 billion.

The data in this section are taken from our trade in goods country by commodity dataset, which has not been seasonally adjusted. The data are produced on a balance of payments (BoP) basis and are therefore consistent with the national accounts; however, because the data are not seasonally adjusted, they might not match exactly with other data in this release, which are seasonally adjusted.

Figure 6 shows the top five commodity risers and fallers for exports in the three months to August 2018.

The largest commodity export riser in the three months to August 2018 was unspecified goods (including non-monetary gold) to Switzerland, which rose £0.9 billion. The second largest commodity export was crude oil to the Netherlands, which increased £0.7 billion to £2.2 billion.

The largest commodity export faller in the three months to August 2018 was works of art to the United States including Puerto Rico, which fell £0.6 billion to £0.5 billion.

Figure 7 shows the top five commodity risers and fallers for imports in the three months to August 2018.

The largest commodity import riser was aircrafts from the United States including Puerto Rico, which increased £1.1 billion to £1.4 billion in the three months to August 2018; this was followed by imports of electrical machinery from China, which rose £0.5 billion to £3.4 billion.

The largest commodity import faller was cars from Germany, which fell £1.5 billion to £3.0 billion in the three months to August 2018; this was followed by imports of unspecified goods (including non-monetary gold) from the United States including Puerto Rico, which fell £0.9 billion.

Figure 8 shows the changes to goods, services and total trade balances along with exports and imports in the 12 months to August 2018, compared with the 12 months to August 2017.

The total UK trade deficit (goods and services) narrowed £13.5 billion in the 12 months to August 2018. The goods deficit narrowed £5.0 billion, while the trade in services surplus widened £8.6 billion.

Rising exports were the main reason for the narrowing of the deficit in the 12 months to August 2018; exports of services increased £14.7 billion (5.3%) and goods exports rose £18.6 billion (5.6%), while imports increased £6.1 billion (3.7%) and £13.6 billion (2.9%) for services and goods respectively.

Figure 8: Change in UK trade balances, exports and imports, 12 months to August 2018 compared with 12 months to August 2017

Source: Office for National Statistics

Notes:

1. The arrow direction indicates whether a component has increased or decreased, while the colour denotes the impact the direction of a movement has on the trade balance.

2. For example, an increase in imports is denoted by an upward red arrow, as a rise in imports has a negative impact on the trade balance, while an increase in exports is denoted by an upward green arrow, as a rise in exports has a positive impact on the trade balance.

Download this image Figure 8: Change in UK trade balances, exports and imports, 12 months to August 2018 compared with 12 months to August 2017

.PNG (53.0 kB)

Figure 9 shows the changes in the UK goods exports, imports and trade balances with EU and non-EU countries in the 12 months to August 2018 compared with the 12 months to August 2017.

The UK trade in goods deficit with the EU narrowed £4.5 billion in the 12 months to August 2018 compared with a narrowing of £0.5 billion with countries outside the EU.

In the 12 months to August 2018, we saw an increase in exports of £12.5 billion and imports of £8.0 billion from the EU; this compares with £6.1 billion exports and £5.7 billion imports for trade with countries outside the EU.

Figure 10 shows the percentage split of goods exports and imports by countries inside and outside the EU in the 12 months to August 2018.

In the 12 months to August 2018, 55% of our goods were imported from the EU, while we exported 51% of our goods to countries outside the EU.

For more information about our methods and how we compile these statistics, please see Trade in goods, country-by-commodity experimental data: 2011 to 2016. Users should note that the data published alongside this release are no longer experimental.

What goods does the UK trade with the rest of the world? Our data breaks down UK trade in goods with 234 countries by 125 commodities.

Use our map to get a better understanding of UK trade in goods with a particular country. Select a country by hovering over it or using the drop-down menu.

What about trade in a particular commodity? What percentage of UK car exports goes to the EU? Where does the UK's imported tea and coffee come from?

Use our interactive tools to understand UK trade of a particular commodity.

Select a commodity from the drop-down menu, or click through the levels to explore the data.

UK trade in goods by commodity with the rest of the world, imports and exports, 2012 to 2017

UK exports, 2017

Published on 24 September 2018, the article Why has the UK trade in goods deficit widened in real terms? uses our new country-by-commodity data to look at the UK trade in goods deficit over the past 20 years. It highlights which countries and commodities have been behind the growth of the deficit.

Published in July 2018, UK trade in goods and productivity: new findings describes a new dataset we have developed, which includes information from both the Annual Business Survey and HM Revenue and Customs’ trade in goods administrative data. It shows a strong association between trader status and productivity, highlighting the prevalence of trading behaviour across different types of business (published 6 July 2018).

Supplementary quarterly data analysed by product according to the UK trade in goods by classification of product by activity (CPA 2008) are also available.

The complete run of data in the tables of this statistical bulletin are also available to view and download in other electronic formats free of charge using our time series data website service. You can download the complete statistical bulletin in a choice of formats, or view and download your own selection of individual series.

Goods data are now available by commodity and partner country in this release, which are consistent with the national accounts on a balance of payments basis. Background information on these data are available via the Trade in goods, country-by-commodity experimental data: 2011 to 2016 we published in April 2016.

We now publish the proportion of sales that are exports in the manufacturing industries as an Excel dataset to accompany the Index of Production release. The proportion of export sales have been published for industries collected by the Monthly Business Survey where the value of exports are reported as well as the total turnover. These are non-seasonally adjusted series.

On 28 October 2016, we published an article containing information on trade – Why has the value of the pound been falling and what could this mean for people in the UK?

On 5 September 2016, we published a short story on the UK trade and investment relationship with the USA. This is part of a series that began in June 2015; previous topics cover South America, China and Africa.

Additional statistical data and analyses for UK trade statistics that have not been included in our standard publications are also available.

Trade is measured through both exports and imports of goods and/or services. Data are supplied by over 30 sources including several administrative sources, HM Revenue and Customs (HMRC) being the largest.

This monthly release contains tables showing the total value of trade in goods together with chained volume measures (CVMs) and implied deflators (IDEFs). Figures are analysed by broad commodity group (CVMs and IDEFs) and according to geographical area (values only). In addition, the UK trade statistical bulletin also includes early monthly estimates of the value of trade in services.

Further qualitative data and information can be found in the attached datasets. This includes data on:

• response rates

• revision triangles

Detailed methodological notes are published in the UK Balance of Payments, The Pink Book 2018.

The UK trade methodology web pages have been developed to provide detailed information about the methods used to produce UK trade statistics.

The UK trade Quality and Methodology Information report contains important information on:

• the strengths and limitations of the data and how it compares with related data

• uses and users of the data

• how the output was created

• the quality of the output including the accuracy of the data