UK trade: Oct 2016

UK trade shows import and export activity and is a main contributor to the overall economic growth of the UK. All data are shown on a seasonally adjusted, balance of payments basis, at current prices unless otherwise stated.

Monthly

The UK’s deficit on trade in goods and services was estimated to have been £2.0 billion in October 2016, a narrowing of £3.8 billion from September 2016. Exports increased by £2.0 billion and imports decreased by £1.8 billion.

The deficit on trade in goods was £9.7 billion in October 2016, narrowing by £4.1 billion from September 2016. This narrowing reflected a £2.1 billion increase in exports to £26.8 billion and a £2.0 billion decrease in imports to £36.5 billion.

3-monthly

Between the 3 months to July 2016 and the 3 months to October 2016, the total trade deficit for goods and services widened by £4.7 billion to £13.2 billion.

Between the 3 months to July 2016 and the 3 months to October 2016, the deficit on trade in goods widened by £6.2 billion to £37.0 billion. Exports increased by £1.6 billion (2.0%) and imports increased by £7.7 billion (7.3%).

Between the 3 months to July 2016 and the 3 months to October 2016, the UK’s trade in goods deficit with the EU widened by £1.9 billion to £24.5 billion and the UK’s trade in goods deficit with countries outside the EU widened by £4.3 billion to £12.5 billion, attributed to an increase in exports (2.1%) and an increase in imports (10.9%).

Between the 3 months to July 2016 and the 3 months to October 2016, the trade in services surplus widened by £1.4 billion to £23.8 billion, as exports increased by £0.9 billion and imports decreased by £0.6 billion.

Revisions

There are large revisions to the period January 2015 to September 2016, resulting from the correction of a processing error within the "erratics" series of UK trade (see correction note) and also taking on some later data. The UK trade deficit for goods and services in September 2016 is now estimated to be £5.8 billion (£5.2 billion previously reported).

The total trade deficit for goods and services for Quarter 3 (July to Sept) 2016 is now estimated at £14.9 billion (last wider in Quarter 4 (Oct to Dec) 2013). This represents a widening of £6.7 billion from Quarter 2 (Apr to June) 2016. The deficit in Quarter 3 2016 was previously reported to narrow by £1.7 billion. The revision is most prominent in the trade in goods with non-EU countries series, where exports have been revised down in Quarter 3 2016 by £3.4 billion and imports have been revised up £2.3 billion, revising the trade in goods deficit from £9.4 billion to £15.1 billion.

The widening of the deficit in Quarter 3 (July to Sept) 2016 is largely driven by a widening of the deficit for trade in erratics by £5.4 billion. The erratic series is volatile; therefore a total trade series that excludes erratics may provide a better guide to the emerging trade picture. The total trade deficit excluding erratics in Quarter 3 2016 is estimated to be £10.5 billion, widening by £1.2 billion from Quarter 2 (Apr to June) 2016.

Short guide to UK trade

UK trade shows the extent of import and export activity and is an important contributor to the overall economic growth of the UK. Trade is measured through both imports and exports 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 index numbers of volume and price. Figures are analysed by broad commodity group (values and indices) 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.

This bulletin focuses on trade in goods as it is easier to quantify and measure due to the coverage and comprehensiveness of the administrative data sources available. Trade in services is more difficult to measure, and source data are provided mainly on a quarterly or annual basis, principally from International Trade in Services survey. Monthly estimates are derived using this quarterly data so the data are less robust on a monthly basis compared with goods.

As more information becomes available on trade in services this bulletin will focus on the values, volumes and geographic breakdown on a 3-month cycle described below:

Our website

The UK trade methodology web pages can now be found on our website. These have been developed to provide detailed information about the methods used to produce UK trade statistics. Any recent user requested trade data are included on our website.

Understanding UK trade

We make every effort to provide informative commentary on the data in this release. Where possible, the commentary draws on evidence from other sources of information to help explain possible reasons behind the observed changes. However, in some instances it can prove difficult to draw out detailed reasons for movements; consequently, it is not possible for all data movements to be fully explained.

Trade statistics for any 1 month can be volatile. For that reason, it is recommended to compare the latest 3 months against the preceding 3 months and the same 3 months of the previous year.

When examining the trade in goods data, oil and “erratics” (which are high-value, low-volume products) are removed from some analysis as they can make a large contribution to trade in goods as a whole. We publish data inclusive and exclusive of these categories. We also provide a separate analysis of oil because it is subject to erratic price fluctuations and so volume data are provided in metric tonnes as well as value (£ billion). A total trade series that excludes erratics has been included in this release as it may provide a better guide to the emerging trade picture.

Strengths and weaknesses of the data

Strengths

Quality of trade in goods data

The quality of the source data for trade in goods is high in terms of the timeliness, comprehensiveness and coverage, and this level of quality compares well internationally. The data are used across government, business and academia and feed into a number of other outputs and publications, including gross domestic product (GDP) and balance of payments (BoP). The Bank of England uses the total figures to make policy decisions, whereas government departments such as the Foreign and Commonwealth Office are interested in the individual country detail.

We have frequent communication with our suppliers to discuss quality, including regular meetings, telephone conversations and email correspondence. Service level agreements are in place to define the level of quality expected in the data received and these are reviewed annually. Data suppliers have their own internal quality assurance processes to meet the quality standards outlined in the service level agreements and we work closely with them to understand these. Suppliers are required to advise us of any changes to the collection or processing of the data to ensure our expectations are still met.

When data are received by the trade team we conduct our own initial quality assurance. Further quality analysis is then conducted at several stages of processing; this is detailed in a process map and quality assurance plan. If there are any quality concerns we work closely with the supplier to address these.

We have regular discussions with users on the quality of our data and provide comprehensive explanations of the terms, methodology and processes we use. Eurostat is an important customer influence and helps improve the quality of our data through task force meetings and by producing quality guidelines.

Timeliness of publications

The UK trade publication is very timely (generally 40 days after the period to which it refers), helping to inform policy and to assess UK economic performance.

Weaknesses

Quality and timeliness of trade in services data

Where trade in goods has 1 main data supplier, there are a large number of suppliers of trade in services data. Additionally, a number are voluntary, so it can be difficult to establish and maintain the same quality assurance processes and relationships with these businesses or suppliers.

Due to the collection methods and complexities of quantifying trade in services, data are less timely than trade in goods estimates. The data are processed quarterly, so monthly forecasts are made to provide a complete trade total.

Monthly volatility

Trade statistics for any 1 month can be erratic. For that reason, we recommend comparing the latest 3 months against the preceding 3 months and the same 3 months of the previous year. However, we also recognise the importance to users of an early estimate of trade so we continue to produce a monthly estimate.

UK trade National Statistics suspension

Due to a series of errors during 2014, the UK Statistics Authority suspended the National Statistics designation of UK trade on 14 November 2014. The Authority's reassessment of UK trade against the Code of Practice for Official Statistics has been completed. We are committed to meeting the requirements and regaining National Statistics status for UK trade as soon as possible and will keep you informed of progress.

One of the recommendations of the reassessment was to consult with users on the use of UK trade statistics. The results of our user engagement survey can be found on our website.

The UK trade development plan was published for consultation in March 2016. We are grateful for the responses received. As detailed elsewhere in this release, we are undertaking and applying ongoing improvements to UK trade statistics in line with this development plan and to anticipate future demands. We aim to publish an updated UK trade development plan later in December 2016; this will reflect the feedback received in the consultation in March, and new requirements identified with stakeholders since then.

To provide feedback on this bulletin or the ongoing improvements, please contact us via email: trade@ons.gov.uk.

UK trade reassessment update

We have now addressed some of the requirements of the reassessment of UK trade and are providing evidence on the remaining requirements. In doing so, we are working with the Assessment Team to evaluate whether any additional evidence will be required as a result of the independent review of UK economic statistics led by Professor Sir Charles Bean. We have invested more resource into improving and developing the UK trade statistics, which is supported by the UK Statistics Authority. While developing, and delivering against, our development plan, we will continue to work with the Assessment Team to regain National Statistics status for UK trade statistics.

In July 2016, improvements to seasonal adjustment were implemented which reduce the volatility in the implied deflator.

Definitions and explanations

A glossary of terms is published in the UK trade glossary and the UK Balance of Payments, The Pink Book 2016.

Nonmonetary gold

According to internationally agreed standards, non-monetary gold held in allocated accounts is recorded as a good; therefore, gold of this type which is being stored as a financial asset is recognised under trade in goods when ownership changes between a resident and non-resident.

Data are collected by the Bank of England from the London Bullion Market on holdings of non-monetary gold. Working alongside the Bank of England and the London Bullion Market Association, we have implemented a method for smoothing the source data, effectively minimising volatility while enabling the underlying trend of the gold market to be reflected in the trade balance.

Estimates for trade in nonmonetary gold still remain volatile compared with other commodities and, as such, it is classified under erratics.

Use of the data

UK trade is a main economic indicator due to the importance of international trade to the UK economy. It is also a very timely statistic, providing an early indicator of what is happening more generally in the economy.

In addition, it is a major component of 2 other main economic indicators: UK Gross Domestic Product (GDP) and the UK Balance of Payments (BoP). This means that there are 3 potential ways for UK trade statistics to inform the government’s view of the UK economy, as well as the views of others, such as economists, city analysts, academics, the media and international organisations.

Notes on tables

Rounding:

The sum of constituent items in tables does not always agree exactly with the totals shown due to rounding.

Symbols:

.. Not applicable

- Nil or less than half the final digit shown

Monthly analysis

The deficit on trade in goods and services in October 2016 was £2.0 billion, compared with a revised deficit of £5.8 billion in September 2016. The narrowing of the deficit reflects an increase in exports and a decrease in imports between September 2016 and October 2016.

Between September 2016 and October 2016, total exports (goods and services) increased by £2.0 billion (4.6%) to £46.4 billion; this increase reflected a £2.1 billion (8.7%) increase in the export of goods. Total imports (goods and services) decreased by £1.8 billion (3.6%) to £48.4 billion over the same period, reflecting a £2.0 billion (5.2%) decrease in the import of goods.

The deficit on trade in goods was £9.7 billion in October 2016, narrowing by £4.1 billion from September 2016. This narrowing reflects an increase in exports and a decrease in imports. Exports of machinery and transport equipment, and unspecified goods increased by £0.6 billion each, with material manufactures and chemicals increasing by £0.3 billion each.

Between September 2016 and October 2016, exports of goods to EU countries increased by £0.2 billion (1.5%) to £12.4 billion, mainly reflecting an increase in exports of miscellaneous manufactures (£0.2 billion) and material manufactures (£0.1 billion). These rises were offset by a decrease in fuels (£0.2 billion). Imports of goods from EU countries decreased by £0.3 billion to £20.5 billion in October 2016; there were decreases in imports of machinery and transport equipment of (£0.4 billion) offset by rises in imports of food, beverages and tobacco (£0.1 billion).

Between September 2016 and October 2016, exports of goods to countries outside the EU increased by £2.0 billion, reflecting a rise in unspecified goods (£0.6 billion), machinery and transport equipment (£0.5 billion), chemicals (£0.3 billion) and fuels (£0.2 billion). Imports of goods from countries outside the EU decreased by £1.7 billion, reflecting falls in imports of machinery and transport equipment (£1.1 billion), material manufactures (£0.4 billion) and miscellaneous manufactures (£0.3 billion). The deficit with non-EU countries in October 2016 was £1.6 billion.

3-monthly analysis

Between the 3 months to July 2016 and the 3 months to October 2016, the total trade deficit (goods and services) widened by £4.7 billion to £13.2 billion. The trade position reflects exports minus imports; the widening of the deficit reflected a greater rise in imports (5.0%) than the rise in exports (1.8%). Both total trade exports and imports reached 3-monthly highs in the 3 months to October 2016 of £135.5 billion and £148.7 billion respectively.

The deficit on trade in goods widened by £6.2 billion to reach a deficit of £37.0 billion between the 3 months to July 2016 and the 3 months to October 2016. Exports of goods increased by £1.5 billion (2.0%), to £76.4 billion. This increase was mainly attributed to a £0.9 billion increase in material manufactures to £7.1 billion, a £0.7 billion increase in mechanical machinery, a £0.5 billion increase in electrical machinery, a £0.3 billion increase in chemicals and a £0.2 billion rise in cars to a record high of £7.8 billion; these increases were partially offset by a £1.0 billion decrease in exports of other transport equipment (to £4.0 billion). Imports of goods increased by £7.7 billion (7.3%) to a record high of £113.4 billion, as imports of fuels increased by £1.2 billion to £9.2 billion, electrical machinery increased by £1.2 billion, material manufactures increased by £1.0 billion, miscellaneous manufactures increased by £0.7 billion, cars increased by £0.6 billion to a record high of £8.8 billion, mechanical machinery increased by £0.6 billion and food and live animals increased by £0.5 billion to a record high of £8.7 billion.

Between the 3 months to July 2016 and the 3 months to October 2016, exports of goods to EU countries increased by £0.7 billion to £37.1 billion. This was due to small increases in most commodities, with the exception of fuels, which fell by £0.2 billion. Imports from the EU increased by £2.6 billion to a record high of £61.6 billion in the 3 months to October 2016. This increase reflected rises in imports of chemicals of £0.5 billion, material manufactures of £0.5 billion, electrical machinery of £0.5 billion and cars of £0.4 billion to a record high of £7.8 billion. These movements caused the deficit with the EU to increase by £1.9 billion to £24.5 billion.

Between the 3 months to July 2016 and the 3 months to October 2016, there was a rise in exports to countries outside the EU of £0.8 billion to £39.3 billion, with a rise of £0.7 billion in material manufactures and £0.6 billion in mechanical machinery. These increases were partially offset by a £0.6 billion decrease in exports of aircraft. Imports from non-EU countries increased by £5.1 billion to £51.8 billion, with a £0.9 billion increase in imports of fuels, a £0.8 billion increase in other transport equipment, a £0.7 billion increase in miscellaneous manufactures and a £0.7 billion increase in electrical machinery.

Between the 3 months to July 2016 and the 3 months to October 2016, exports of services rose by £0.9 billion and imports of services fell by £0.6 billion, resulting in a widening of the trade in services surplus by £1.4 billion to £23.8 billion.

Revisions

There are large revisions to the period January 2015 to September 2016, resulting from the correction of a processing error within the "erratics" series of UK Trade (see correction note) and taking on some later data. The UK trade deficit for goods and services in September 2016 is now estimated to be £5.8 billion, which was previously reported as £5.2 billion.

Between Quarter 2 (April to June) 2016 and Quarter 3 (July to September) 2016, the total trade deficit for goods and services is now estimated to be £14.9 billion (last higher in Quarter 4 (October to December) 2013), widening by £6.7 billion. The deficit in Quarter 3 2016 was previously reported to narrow to £11.0 billion from £12.7 billion in Quarter 2 2016.

The revision is most prominent in the trade in goods with non-EU countries, where exports have been revised down in Quarter 3 2016 by £3.4 billion and imports have been revised up by £2.3 billion, therefore revising the deficit of trade in goods with the non-EU countries from £9.4 billion to £15.1 billion.

Following the EU referendum, the value of sterling fell sharply against a basket of currencies at the end of June 2016 and into July. In October 2016, sterling was 5.1% lower compared with the September average and 18.5% lower compared with October 2015. Recent depreciation has coincided with upward price pressure on both export and import prices. Comparing September and October 2016, export prices increased by 4.1% while import prices grew by 3.1%. Compared to a year earlier, the rate of trade price inflation was far higher (14.3% and 9.4% respectively). This has had a varying effect on the deflation and resulting volume of trade to both the EU and non-EU economies: further information can be found in the latest PPI analysis and the Economic Review.

Volumes of UK goods exported to non-EU and EU countries have varied in recent years. Figure 2 shows the volume of goods exports to both markets, indexed to their levels in Quarter 1 (Jan to Mar) 2008. In the immediate aftermath of the downturn, UK goods exports to non-EU countries grew at a far faster rate than exports to the EU. However, exports of goods to the EU have risen faster in the most recent quarters compared with exports to non-EU economies, which have been broadly flat for a number of quarters. In addition the value of goods export trade with the EU remains large at over 47% of total goods exports (in the 2015 calendar year).

Trade by types of commodity have also varied in recent years. Since Quarter 3 (July to Sept) 2009, the value of goods exports has risen by 0.9% per quarter, the same rate as overall nominal GDP growth in the same period. However, the export performance of various trade products has varied considerably – with the vast majority of growth taken up by complex machinery as opposed to intermediate goods. This is shown in Figure 3, which plots the cumulative contribution to growth from a range of commodities.

For example, since Quarter 3 2009 the value of goods exports of basic materials (for example, raw textiles, waxes and oils) and semi-manufactures (that is, refined metals and chemicals) has only risen by 0.7% and 0.2% per quarter respectively. Instead the largest contribution to growth came from the finished manufactures category, which includes a broad mix of machinery, telecommunications equipment and vehicles. This rose by 1.5% per quarter over the whole period, and was especially strong in Quarter 1 and Quarter 2 2016.

Rotterdam effect

In this context you should note the “Rotterdam effect”, where goods initially exported to one country are subsequently re-exported to another country. This might overstate the share of exports going to a particular country, in this case the Netherlands, and so overstate the share of exports going to the EU.

It is not possible to quantify this issue precisely, but an article exploring the Rotterdam effect was published in 2015. The article used 2013 data to estimate the effect and made an assumption that 50% of all goods exports to the Netherlands were re-exported to non-EU countries. Using this assumption, the Rotterdam effect would account for around 4 percentage points of the UK’s exports of goods. These effects were calculated to illustrate the possible size of the Rotterdam effect. The Rotterdam effect applies only to trade in goods. The 4 percentage points estimate applies to the share of the exports of goods only.

Monthly analysis

In October 2016, the UK’s deficit on trade in goods was £9.7 billion, narrowing by £4.1 billion from September 2016.

Exports increased by £2.1 billion (8.7%) to a record £26.8 billion in October 2016.

In detail:

• machinery and transport equipment rose by £0.6 billion

• unspecified goods rose by £0.6 billion

• material manufactures rose by £0.3 billion

• chemicals rose by £0.3 billion

Imports decreased by £2.0 billion (5.2%) to £36.5 billion in October 2016, from £38.5 billion in September 2016.

In detail:

• aircraft decreased by £0.5 billion

• ships decreased by £0.5 billion

• material manufactures fell by £0.4 billion

3-monthly analysis

Between the 3 months to October 2016, the deficit on trade in goods was £37.0 billion, widening by £6.2 billion from the 3 months to July 2016.

Exports increased by £1.5 billion (2.0%) to £76.4 billion in the 3 months to October 2016.

In detail:

• material manufactures rose by £0.9 billion

• mechanical machinery rose by £0.7 billion

• electrical machinery rose by £0.5 billion

• chemicals rose by £0.3 billion

• cars rose by £0.2 billion to a record high of £7.8 billion

• other transport equipment fell by £1.0 billion (as aircraft decreased £0.7 billion and ships decreased £0.4 billion)

Imports increased by £7.7 billion (7.3%) to £113.4 billion in the 3 months to October 2016, compared with £105.7 billion in the 3 months to July 2016.

In detail:

• electrical machinery rose by £1.2 billion

• fuels rose by £1.2 billion

• material manufactures rose by £1.0 billion

• miscellaneous manufactures rose by £0.7 billion

• cars rose by £0.6 billion to a record high of £8.8 billion

• mechanical machinery rose by £0.6 billion

• food and live animals rose by £0.5 billion to a record high of £8.7 billion

At the main commodity level the data are shown in Table 2.

Where to find data about UK trade in goods

The value of trade in goods figures are available in Table 1 and commodity figures are available in Tables 8, 9 and 10 of the UK trade dataset.

In October 2016, the deficit on trade in goods with EU countries narrowed by £0.5 billion to £8.1 billion. The deficit on trade in goods with non-EU countries narrowed by £3.7 billion to £1.6 billion (Figure 6).

EU analysis

Between September 2016 and October 2016, exports of goods to the EU increased by £0.2 billion (1.5%) to £12.4 billion. This was attributed to increases in exports to the Republic of Ireland and the Netherlands of £0.2 and £0.1 billion respectively, partially offset by a decrease in exports to Sweden of £0.1 billion.

Between September 2016 and October 2016, imports of goods from the EU decreased by £0.3 billion (1.3%) to £20.5 billion. This was attributed to decreases in imports from Finland, Germany, the Netherlands and Spain of £0.1 billion each.

Between the 3 months to July 2016 and the 3 months to October 2016, exports of goods to the EU increased by £0.7 billion (2.0%) to £37.1 billion. This was mainly attributed to increases in exports to Germany and Italy of £0.3 and £0.2 billion respectively.

Between the 3 months to July 2016 and the 3 months to October 2016, imports of goods from the EU increased by £2.6 billion (4.4%) to £61.6 billion. This was primarily attributed to increases in imports from the Netherlands of £0.9 billion, Germany of £0.7 billion and Belgium and Luxembourg (combined) of £0.3 billion.

At the commodity level, the data are shown in Table 3.

Non-EU analysis

Between September 2016 and October 2016, exports of goods to non-EU countries increased by £2.0 billion (15.7%) to a record £14.4 billion. This was mainly attributed to an increase in exports to Switzerland of £0.7 billion and increases to Saudi Arabia, South Korea and United Arab Emirates of £0.2 billion each. Exports to United Arab Emirates reached a record high of £0.7 billion.

Between September 2016 and October 2016, imports of goods from non-EU countries decreased by £1.7 billion (9.7%) to £16.0 billion. This was mainly attributed to decreases in imports from Singapore of £0.5 billion, China and Switzerland of £0.4 billion each and the USA of £0.2 billion.

Between the 3 months to July 2016 and the 3 months to October 2016, exports to non-EU countries increased by £0.8 billion (2.1%) to £39.3 billion. This was mainly attributed to an increase in exports to Switzerland of £0.5 billion, exports to the USA of £0.4 billion and exports to Egypt, Japan, Singapore and United Arab Emirates of £0.2 billion each. However, offsetting this rise, exports to Norway decreased by £0.5 billion and exports to South Africa and China fell by £0.4 billion each.

Between the 3 months to July 2016 and the 3 months to October 2016, imports from non-EU countries increased by £5.1 billion (10.9%) to £51.8 billion. This was mainly attributed to increases in imports from China and the USA of £0.9 billion each, Singapore of £0.6 billion and Norway of £0.5 billion.

At the commodity level, the data are shown in Table 4.

Where to find data about UK trade in goods – analysis by area

Trade in goods by area figures are available in Table 2 and value of trade in goods with selected EU and non-EU trading partner figures are available in Tables 11 and 12 of the dataset.

Monthly analysis

The USA was the UK’s top export partner with exports of £4.0 billion in October 2016, an increase of £0.1 billion when compared with September 2016.

Germany was the UK’s top import partner with imports of £5.6 billion in October 2016, a decrease of £0.1 billion when compared with September 2016.

3-monthly analysis

In the 3 months to October 2016, the USA was the UK’s top export partner with exports of £11.9 billion, an increase of £0.4 billion when compared with the 3 months to July 2016.

In the 3 months to October 2016, Germany was the UK’s top import partner with imports of £16.6 billion, increasing by £0.7 billion when compared with the 3 months to July 2016.

Where to find data about UK trade in goods – geographical analysis

Trade in goods by area figures are available in Table 2 and value of trade in goods with selected EU and non-EU trading partner figures are available in Tables 11 and 12 of the UK trade dataset.

Between September 2016 and October 2016, the volume of exports increased by 4.7%.

Between September 2016 and October 2016, the volume of imports decreased by 4.2%.

Between the 3 months to July 2016 and the 3 months to October 2016, the volume of exports increased by 0.3%.

Between the 3 months to July 2016 and the 3 months to October 2016, the volume of imports increased by 3.7%.

At the commodity level, the data are shown in Table 7.

In October 2016, compared with September 2016, export prices increased by 4.1% and import prices increased by 3.1%. Excluding the oil price effect, export prices increased by 3.3% and import prices increased by 2.8%.

Between the 3 months to July 2016 and the 3 months to October 2016, export prices increased by 5.2% and import prices increased by 3.4%. Excluding the oil price effect, export prices increased by 4.9% and import prices increased by 3.0%.

In October 2016, the balance of trade in oil was in deficit by £0.9 billion, a narrowing of £0.1 billion from September 2016. Oil exports increased by £0.1 billion to £1.7 billion and oil imports increased by £0.1 billion to £2.6 billion.

In the 3 months to October 2016, the balance on trade in oil was in deficit by £2.5 billion, widening by £1.5 billion from the 3 months to July 2016. Oil exports decreased by £0.4 billion to £4.9 billion and oil imports increased by £1.1 billion to £7.4 billion.

Where to find data about trade in oil

The trade in oil figures are available in Tables 1 and 7 of the UK trade dataset.

Information on trade in services is mainly obtained from quarterly surveys, in some cases underpinned by larger annual surveys. This means that the latest months are uncertain.

Between September 2016 and October 2016, the estimated surplus on trade in services fell by £0.3 billion to £7.7 billion. Exports were estimated to have been £19.7 billion and imports £11.9 billion.

In Quarter 3 (July to September) 2016, the surplus on trade in services was £23.8 billion; financial services being the largest contributor to this with a surplus of £9.9 billion.

Analysis by volume (chained volume measure CVM)

Between Quarter 2 (April to June) 2016 and Quarter 3 (July to September) 2016, exports of services fell by £0.3 billion to £57.7 billion; the main contributors to this decrease were telecommunication, computer and information services (£0.5 billion), air transport services (£0.3 billion) and financial services (£0.3 billion). This decrease was offset by an increase in insurance services (£0.8 billion). For the same period, the import of services decreased by £2.0 billion to £33.8 billion; the main contributors to this decrease were other business services (£1.3 billion) and travel services (£0.5 billion).

Between Quarter 3 2015 and Quarter 3 2016, exports of services increased by £3.5 billion. Within exports, the largest increases were seen in insurance services (£2.1 billion) and other business services (£1.1 billion). For the same period, imports decreased by £1.7 billion, reflecting a decrease in other business services (£2.0 billion); this was offset by an increase in financial services of £0.3 billion.

Revisions

Between the September 2016 and October 2016 UK trade publication, the Quarter 3 (July to September) 2016 surplus for trade in services has been revised up by £1.6 billion, which reflected an upward revision of £1.1 billion in exports and a downward revision of £0.5 billion in imports. The main contributor for the revision in exports was insurance services (£1.0 billion). The main contributor for the revision in imports was other business services (£1.5 billion). This revision was partly offset by an upward revision in the import of travel services (£0.9 billion).

Where to find data about trade in services

The trade in services figures are available in Table 1 CONT. of the dataset.

A quarterly breakdown of trade in services by selected countries can be found in the Quarter 2 (April to June) 2016 UK Economic Accounts.

More detail on trade in services by type of service and partner county can be found in the annual UK Balance of Payments, The Pink Book 2016.

Other regularly published UK trade releases

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 latest release on 14 September 2016 covered the period Quarter 2 (April to June) 2016 and the data are fully consistent with the UK Balance of Payments, The Pink Book: 2016 and UK National Accounts, The Blue Book: 2016 datasets.

Following an internal review of our publications and a wider survey of users there is no longer a statistical bulletin associated with the release. However, additional excel tables have been added with an EU and non-EU breakdown by product.

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 zipped formats, or view and download your own selections of individual series.

The data in the UK trade explorable datasets of this statistical bulletin are also available to view and download in other electronic formats free of charge using our website service. You can download the complete UK trade explorable datasets in a choice of zipped formats, or view and download your own selections of individual series.

Recently published reports on UK trade topics

The Economic review: November 2016, published on 3 November 2016, contains information on trade post-EU referendum and also the contribution of trade to gross domestic product (GDP).

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 UK trade and investment relationship with the USA. This is part of a series which began in June 2015, previous topics cover South America, China and Africa.

On 29 July 2016, we published the annual UK Balance of Payments, The Pink Book: 2016, which as well as containing more detailed information on trade also provided an overview of the trade deficit in relation to the current account deficit.

We have published a methodology article estimating the value of service exports abroad from different parts of the UK. This work has been undertaken to meet user needs for subnational estimates for exports of services. The article provides annual estimates for 2011 to 2014, including breakdowns by region, commodity and industry, which at this stage are considered experimental. We welcome feedback on the article and the proposed methodology.

The Economic Review: April 2016, published on 6 May 2016, contains information on trade as a percentage of GDP.

The Economic Review: February 2016, published on 3 February 2016, includes analysis of trade with EU and non-EU countries.

On 29 January 2016, annual International Trade in Services 2014 survey results were published. This release gives information on the industry of the businesses engaged in trade in services.

Historic articles published on UK trade

In our Economic Review: September 2015, published on 3 September 2015, there is further commentary on UK export performance.

On 1 September 2015, we published an article on the economic performance of the UK’s motor vehicle manufacturing industry.

On 26 June 2015, we published a short story on the importance of EU to UK trade and investment.

On 6 February 2015, we published an article on the Rotterdam effect and its potential impact on the UK trade in goods estimates.

On 23 January 2015, we published a short story exploring the reasons behind the UK trade deficit.

Published user requested data and analysis

Additional statistical data and analyses for UK trade statistics that have not been included in our standard publications are available at the user requested data and analysis pages on our website.

Methodological articles

Detailed methodological notes are published in the UK Balance of Payments, The Pink Book: 2016.

Revisions

In this release, the revision period for trade in services is from July 2016 and trade in goods is revised from January 2015, in-line with the National Accounts revision policy. As explained in the correction notice published on 6 December 2016, we have also corrected a processing error identified within the erratics series. That has driven the large revisions for the period between January 2015 and September 2016.

Between the September 2016 and October 2016 releases, trade in goods has a downwards revision of £1.5 billion to exports and a downwards revision of £0.3 billion to imports in September 2016.

The revision to exports of goods is mainly attributed to the correction of the processing error and the use of actual data for September 2016 to replace a forecast in the erratics series. This has led to a £1.1 billion downwards revision to the export of unspecified goods to non-EU countries. The revision to imports of goods is attributed to a £0.3 billion downwards revision to imports of machinery and transport equipment to EU countries.

Methodology changes

Change to the way HM Revenue and Customs trade in goods statistics are compiled

From June 2016 there has been a methodological change to the way HM Revenue and Customs compiles non-EU statistics.

Following a change in legislation, non-EU trade in goods statistics have moved from the general trade system of compilation to the special trade system. In brief, special trade records the physical movement of goods to and from the UK, but excludes goods that are placed into customs warehouse where duty and Value Added Tax (VAT) has not yet been paid.

This change has had minimal impact on our trade in goods statistics as we previously applied adjustments to remove those goods held in customs warehouse from our data – the only change we have made is the removal of these adjustments

A full announcement on the Methodological change to UK Trade Statistics from HMRC is available on the HM Revenue and Customs website.

Trade in goods figures for the most recent months are provisional and subject to revision in the light of:

• late trader data

• revisions to seasonal adjustment factors which are re-estimated every month

Trade in services estimates have been derived from a number of quarterly and monthly sources. For components where no monthly data are available, estimates have been derived on the basis of recent trends. The results should be used with appropriate caution, as they are likely to be less reliable than those for trade in goods.

Reliability

Revisions to data provide one indication of its reliability. Table 8 shows summary information on the size and direction of the revisions that have been made to the data covering a 5-year period. A statistical test has been applied to the average revision to find out if it is statistically significantly different from zero. An asterisk (*) shows that the test is significant.

UK trade reassessment

The UK Statistics Authority suspended the National Statistics designation of UK trade on 14 November 2014. The Authority's re-assessment of UK trade against the Code of Practice for Official Statistics has been completed.

One of the recommendations of the reassessment was to consult with users on the use of UK trade statistics. The results of this user engagement survey can be found on our website.

UK trade reassessment update

We have now addressed some of the requirements of the re-assessment of UK trade and are in the final stages of providing evidence on the remaining requirements. In doing so, we are working with the Assessment Team to evaluate whether any additional evidence will be required as a result of the Independent review of UK economic statistics, led by Professor Sir Charles Bean.

Trade development plan

The trade development plan was published for consultation in March 2016. We are grateful for the responses received. As detailed elsewhere in this release, we are undertaking and applying ongoing improvements to UK trade statistics in line with this development plan and also to address recent issues and anticipated future demands. We aim to publish an updated UK trade development plan later in December 2016; this will reflect the feedback received in the consultation in March, and new requirements identified with stakeholders since then.

EMU enlargement

As of 1 January 2015, Lithuania joined the European Monetary Union (EMU). Therefore the EMU totals in this UK trade release include Lithuania.

EMU coverage

The coverage of EMU countries was extended to cover Cyprus and Malta from October 2008, Slovakia from January 2009, Estonia from January 2011, Latvia from January 2014 and Lithuania from January 2015. Some EU and non-EU breakdowns of commodity data for chained volume measures which are available on request may be less reliable than the current price data. Please consult Hannah Finselbach on +44 (0)1633 455635 if you are considering using them.

Data have been combined for the United States and Puerto Rico and for Dubai, Abu Dhabi and Sharjah (the United Arab Emirates) from January 2009 onwards. Estimates are separately available for the United States and Dubai up to the end of 2008 on request.

Erratics

Non-monetary gold is now included in the erratics series, along with ships, aircraft, precious stones and silver. In compliance with the BPM6 changes, non-monetary gold which is held as a store of wealth is now recorded within trade in goods.

Deflation

It is common for the value of a group of financial transactions to be measured in several time periods. The values measured will include both the change in the volume sold and the effect of the change of prices over that year. Deflation is the process whereby the effect of price change is removed from a set of values.

Chain-linked indices (chained volume measures), which are indexed to form the volume series in this bulletin, differ from fixed base indices in that the growth from 1 year to the next is estimated by weighting the components using the contribution to value of trade in the immediately preceding year (effectively re-basing every year). This series of annually re-weighted annual growths is then “chain-linked” to produce a continuous series.

The implied price deflators, derived by comparing current price data to chained volume measures data are not the same as the price indices published in this statistical bulletin, because the former are current weighted while the latter are base (2013) weighted.

Changes in trade associated with Value Added Tax (VAT) missing intra-community (MTIC) fraud mean that comparisons of volume and prices (both including and excluding trade associated with VAT MTIC fraud) should be treated with a great deal of caution.

Interpreting the data

In months where quarterly and 3-monthly ending percentage changes for index data coincide, there may be small differences between the data for methodological reasons. Quarterly data are the indexed form of an underlying constant price (for volume indices) or consistent quantity (for price indices) series. 3-month ending data are the average of the index data in that period.

Seasonal adjustment

Seasonal adjustment aims to remove effects associated with the time of the year or the arrangement of the calendar so that movements within a time series may be more easily interpreted.

The UK trade record information for October 2016 can be accessed on our website.

1. What’s new?

   We now publish the proportion of sales that are exports in the manufacturing industries as an Excel table 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.

   Publication dates

   From January 2017, we are improving the way we publish economic statistics, with related data grouped together under new "theme" days. This will increase the coherence of our data releases and involve minor changes to the timing of certain publications. For more information see Changes to publication schedule for economic statistics.

2. Code of Practice for Official Statistics

   National Statistics are produced to high professional standards set out in the Code of Practice for Official Statistics. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference.

3. Quality and methodology information report

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

   • the strengths and limitations of the data and how it compares with related data
   • users and uses of the data
   • how the output was created
   • the quality of the output including the accuracy of the data