Kiel Trade Indicator 05/2021: Trade likely to stagnate across the board in May
Kiel Trade Indicator, data update 5/20/2021: The months-long catch-up process in global trade is likely to be interrupted across a broad front in May for the first time in around a year. The Kiel Trade Indicator signals stagnation or a decline in imports and exports for Germany, the EU, the USA, China, and also global trade as a whole. It can therefore be assumed that shortages of certain goods will also continue for the time being.
For Germany, the Kiel Trade Indicator signals a slight decline in both exports (-1.7 percent) and imports (-0.5 percent) in May 2021 compared with the previous month (nominal, seasonally adjusted). Declining trade activity is also expected for the EU, with the index value for exports at -4.7 percent slightly deeper in the red than that for imports at -2.1 percent.
For the USA, the Kiel Trade Indicator also signals a negative sign for exports (-2.2 percent) and imports (-1.9 percent). The indicator values for China’s exports (-1.0 percent) and imports (+0.1 percent) are close to zero, so that stagnation can be assumed here.
For total world trade a slight decline of 1.4 percent is expected in May.
„The indicator values for the aforementioned countries all show only moderate swings in May, which are both within the normal range of fluctuation in trade and within the forecasting error. However, the indicators hint at a break in the upward trend in trade flows that has been ongoing for months. This could be due to the fact that demand for shipping containers currently exceeds supply and is driving up transport prices. Shortages of certain products and raw materials could also contribute to the break in the trend,“ says Vincent Stamer, Head of Kiel Trade Indicator.
The next update of the Kiel Trade Indicator will take place on June 3 (without press release) and on June 22 (with press release).
For more information on the Kiel Trade Indicator and forecasts for all 75 countries, visit http://www.ifw-kiel.de/tradeindicator.
About the Kiel Trade Indicator
The Kiel Trade Indicator estimates trade flows (imports and exports) for 75 countries worldwide, the EU, and world trade as a whole. It is based on the evaluation of ship movement data in real time. An algorithm programmed at the Kiel Institute uses artificial intelligence to analyze the data and translates the ship movements into nominal, seasonally adjusted growth figures compared with the previous month.
We update the data twice a month. Around the 20th (with press release) for the current and the following month and around the 3rd (without press release) for the previous and the current month.
Arriving and departing ships are recorded for 500 ports worldwide. In addition, ship movements in 100 maritime regions are analyzed and the effective utilization of container ships is derived from draught information. Country-port correlations can be used to generate forecasts, even for countries without their own deep-sea ports.
Compared to previous leading trade indicators, the Kiel Trade Indicator is available much earlier, is much more comprehensive, relies on a uniquely large database using big data, and has a low statistical error by comparison. The algorithm of the Kiel Trade Indicator uses machine learning, so that the quality of the forecast continues to improve over time.
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