UK trade: May 2018

• The total UK trade deficit widened £5.0 billion to £8.3 billion in the three months to May 2018, mainly due to falling goods exports and rising goods imports.

• Falling exports of cars and rising imports of unspecified goods were mostly responsible for the £5.0 billion widening of the total trade deficit in the three months to May 2018.

• Removing the effect of inflation, the total trade deficit widened £4.7 billion in the three months to May 2018; falling goods export volumes was the main factor as prices generally increased.

• Excluding erratic commodities (mainly unspecified goods), the deficit widened £2.9 billion to £8.7 billion in the three months to May 2018.

• There was a small overall trade surplus on the month to February 2018, mainly due to falling goods imports; the last time there was an overall trade surplus on the month was in February 2011.

• The UK imported 55% of its goods from the EU and exported 51% of its goods to countries outside of the EU in the 12 months to May 2018.

• This bulletin and its associated data tables and time series contain greater detail and improvements to UK trade statistics that we have implemented following our UK trade development plan to deliver against user needs.

A number of improvements

We have embarked upon and are delivering against an ambitious UK trade development plan, which is providing users with better explained and more detailed statistics. We have developed new IT systems for trade in goods and services that we are now using to deliver against objectives set out in section 4.2 of the plan.

As well as headline current price estimates of UK trade, this release includes UK trade figures with the effects of inflation removed for goods and services for EU and non-EU via chained volume measures (CVMs), along with associated implied deflators (IDEFs); estimates of goods imports and exports by 234 countries and 125 commodities; trade in goods seasonally adjusted totals for all countries; and improved publication tables with longer time series.

On 29 June 2018 we published improved trade figures in the quarterly gross domestic product (GDP), sector and financial accounts (SFA), and balance of payments (BoP), consistent with Blue Book and Pink Book 2018. For more information see the revisions section of this release and also National Accounts articles: UK trade data impact assessment from new developments, 1997 to 2016.

International Passenger Survey

Estimates derived from the International Passenger Survey (IPS) are used to help measure imports and exports of travel services. The International Passenger Survey (IPS) is in the process of transferring data collection from paper forms to tablet computers. Initial analysis of the new data suggests there may be discontinuities arising from the change in mode of collection. These new data will not be used in headline trade or other national accounts estimates until we have produced a consistent time series on the new basis. More information is available in the Overseas travel and tourism release.

Data revision policy

All of the data in this release have been revised back to January 1998 when compared with trade figures published in our previous trade bulletin on 11 June. Data in this release are consistent with estimates published in Quarterly National Accounts releases published on 29 June 2018 for Quarter 1 (Jan to Mar) 1998 to Quarter 1 2018.

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.

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

The total UK trade deficit (goods and services) widened £5.0 billion to £8.3 billion in the three months to May 2018 (Figure 1). This was due to a £5.0 billion widening of the trade in goods deficit, resulting from a combination of falling goods exports (£3.1 billion) and rising goods imports (£1.9 billion). Services imports and exports mostly offset each other as both increased by around £0.5 billion, resulting in a relatively small decline in the trade in services surplus.

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

Source: Office for National Statistics

Notes:

1. The goods and services trade balance is the difference between exports and imports.

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

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Figure 2 shows UK trade balances on a three-month on three-month basis for May 2016 to May 2018. The UK’s total trade balance ranged from a £11.6 billion deficit in the three months to August 2016 to a £3.3 billion deficit in the three months to February 2018.

Figure 3 shows the change in exports, imports and the balance for trade in goods on a three-month-on-three-month basis for May 2016 to May 2018.

The most recent widening of the trade in goods deficit (£5.0 billion) in the three months to May 2018 (Figure 3) is the largest widening between the three months to May 2016 and the three months to May 2018.

Figure 4 shows the change in exports, imports and the trade balance for trade in services on a three-month-on-three-month basis for May 2016 to May 2018.

Since February 2017 the UK trade surplus in services has mainly narrowed, which has had a widening effect on the total trade deficit (goods and services). The only exceptions to this since February 2017 was in the three months to November 2017 and May 2018.

The growth in exports of services in the three months to November 2016 as compared with the three months to August 2016 was driven by an increase in other business services. The lesser increase in exports of services seen in the three months to November 2017 as compared with the three months to August 2017 was due to an increase in exports of several service types, with the largest increase being in insurance and pension services.

This section presents estimates of total UK exports, imports and good exports in chained volumes measures (CVMs) and implied deflators (IDEFs). Chained volume measures are estimates that have had the effects of inflation removed. IDEFs presented in this section show the implied change in average prices for the respective components of the trade balance.

Figure 5 shows chained volume measures for the UK trade balances, three-month-on-three-month, May 2016 to May 2018.

In value terms (current prices), the total UK trade balance widened £5.0 billion in the three months to May 2018 compared with the three months to February 2018. This was predominantly driven by falling volumes as the total UK trade CVM balance widened by £4.7 billion to £6.9 billion (Figure 5).

Figures 6 and 7 show total UK exports and imports CVM and IDEFs on a three-month-on-three-month basis between May 2016 and May 2018. The widening of the trade deficit was driven by export volumes, which fell 2.2% in the three months to May 2018 compared with the three months to February 2018. Export prices remained relatively stable over the same period with the IDEF for exports increasing by a relatively small 0.5%.

Imports remained relatively stable for both CVMs and IDEFs in the three months to May 2018, increasing by 0.9% and 0.6% respectively compared with the three months to February 2018.

Figure 8 shows the CVM and IDEF for goods exports on a three month-on-three-month basis between May 2016 and May 2018. The 4.4% fall in the volume of goods exports in the three months to May 2018 was the main driver of the worsening total UK trade balance in the three months to May, with the IDEF for goods growing by 1.0% over the same period.

Figure 9 shows the change in goods exports, imports and trade balances with EU and non-EU countries between the three months to May 2018 and the three months to February 2018.

The goods trade balance widened £2.1 billion to £24.8 billion with EU countries and by £2.9 billion to £11.4 billion with non-EU countries in the three months to May 2018 (Figure 9).

A fall in exports was the main reason for the widening of the trade in goods balance with both EU and non-EU countries in the three-months to May 2018; goods exports to non-EU countries fell by £2.0 billion, while goods exports to the EU fell by £1.1 billion.

Imports also contributed to the widening of the trade in goods balance with both EU and non-EU countries in the three months to May 2018; goods imports from non-EU countries increased by £0.9 billion, while goods imports from the EU increased by £1.0 billion.

The largest contributor to the £2.0 billion decline in exports to non-EU countries was a £1.6 billion decline in exports of machinery and transport equipment, most of which is due to falling exports of cars.

Using our newly published trade in goods by country and commodity data, on a balance of payments basis, non-seasonally adjusted, we are for the first time able to analyse commodity movements at a lower level, that is, by country.

Figure 10 shows exports of machinery and transport equipment by non-EU countries in the three months to May 2018 compared with the three months to February 2018. The country that contributed most to the decline in exports of machinery and transport equipment was the United States including Puerto Rico, followed by Oman and Australia.

Figure 10: Change in UK exports of machinery and transport equipment to non-EU countries, three months to May 2018 compared with previous three months to February 2018

Source: Office for National Statistics

Notes:

1. Users should note that detailed country by commodity data is not seasonally adjusted, whereas data presented elsewhere in this release are seasonally adjusted.

2. This means data displayed in this chart will not match seasonally adjusted data presented elsewhere in this release.

Download this image Figure 10: Change in UK exports of machinery and transport equipment to non-EU countries, three months to May 2018 compared with previous three months to February 2018

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A £1.5 billion increase in imports of unspecified goods (including non-monetary gold) from non-EU countries also had a large impact on the £2.9 billion widening of the goods deficit with non-EU countries.

Figure 11 shows imports of unspecified goods from non-EU countries in the three months to May 2018 compared with the three months to February 2018. The country that contributed most to the increase in imports of unspecified goods was the United States including Puerto Rico, followed by Canada and Saudi Arabia.

Figure 11: Change in UK imports of unspecified goods to non-EU countries, three months to May 2018 compared with previous three months to February 2018

Source: Office for National Statistics

Download this image Figure 11: Change in UK imports of unspecified goods to non-EU countries, three months to May 2018 compared with previous three months to February 2018

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Figure 12 shows UK trade balances on a month-on-month basis between May 2017 to May 2018.

Subject to future revisions (see notes for Figure 12) the total UK trade balance returned a £0.1 billion surplus on the month to February 2018; the total trade deficit narrowed £1.6 billion, turning the deficit into a £0.1 billion surplus.

The last time the UK trade balance returned a surplus was in February 2011 when there was a £0.1 billion surplus. The last time there was a larger surplus than in February 2018 and February 2011 was in January 1998 when there was a £0.5 billion surplus.

The cause of the overall trade surplus in February 2018 was a £1.9 billion narrowing of the trade in goods deficit between January 2018 and February 2018. The surplus would have been larger, although a £0.3 billion narrowing of the trade in services surplus partially offset the movement in the goods balance.

The total trade deficit averaged at £2.2 billion between May 2017 and May 2018, ranging between a deficit of £4.2 billion in June 2017 to a surplus of £0.1 billion in February 2018.

Figure 13 shows the 12-month-on-12-month change to the total trade balance, the goods and services trade balances, and imports and exports of goods and services in the 12-months to May 2018 compared with the 12-months to May 2017.

The total UK trade deficit (goods and services) narrowed £3.9 billion to £26.5 billion in the 12 months to May 2018. An improvement in the trade in services balance was the main factor, as the UK’s trade in services surplus widened £4.1 billion to £111.5 billion. Services exports was the main factor for the widening surplus as exports increased £8.3 billion (3.1%) compared with services imports, which rose £4.3 billion (2.6%).

The trade in goods deficit widened £0.2 billion to £138.0 billion. Goods exports rose £22.1 billion (6.9%) compared with goods imports, which increased £22.2 billion (4.9%).

Figure 13: Change in UK trade balances and goods and services exports and imports, 12-months to May 2018 compared with 12-months to May 2017

Source: Office for National Statistics

Notes:

1. The goods and services trade balance is the difference between exports and imports.

Download this image Figure 13: Change in UK trade balances and goods and services exports and imports, 12-months to May 2018 compared with 12-months to May 2017

.png (45.7 kB)

Figure 14 shows the percentage split of goods imports and exports by countries inside and outside of the EU.

When looking at UK goods imports, 55% came from EU countries, while 51% of UK goods exports were to countries outside of the EU in the 12 months to May 2018. The EU and non-EU split for imports of goods remained the same as the previous 12 months to May 2017, although the amount the UK exports to countries outside of the EU fell slightly, from 52% in the 12 months to May 2017 to 51% in the 12 months to May 2018.

Figure 15 shows the change in UK goods imports, exports and trade balance with EU and non-EU countries in the 12 months to May 2018 compared with the 12 months to May 2017.

The goods deficit with the EU improved by £2.4 billion to £94.6 billion in the 12 months to May 2018 as a result of exports rising £15.8 billion compared with imports that increased by a lesser £13.4 billion.

Goods exports to countries outside the EU rose by £6.3 billion while imports increased £8.9 billion, resulting in a £2.6 billion widening of the UK trade in goods deficit with countries outside of 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? For the first time, 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

UK imports, 2017

You can also access the monthly country by commodity data for exports and imports.

We have embarked upon and are delivering against an ambitious development plan for UK trade statistics. For Blue Book and Pink Book 2018 we have developed new systems for trade in goods and services, as outlined in section 4.2 of the UK trade development plan.

The improvements to trade in goods estimates for Blue Book 2018 and Pink Book 2018, are driven by development of our new trade in goods IT system. The new system we have developed enables us to produce more granular country-by-commodity data on a regular basis for the first time, whilst also incorporating later estimates of data from HM Revenue and Customs (HMRC).

Improvements to trade in services for Blue Book 2018 and Pink Book 2018, are predominantly due to updates in the method used to estimate net spread earnings as well as the annual supply and use balancing process; that is, the process used to reconcile the three approaches to gross domestic product (GDP), income, output and expenditure, as well as including later estimates of data.

Figure 16 shows revisions to the total trade balance published in this release compared with what we published in our previous monthly release on 10 May. Information on the improvements we have made to UK trade data between 1997 to 2016 can be found in National Accounts articles: UK trade data impact assessment from new developments, 1997 to 2016.

Revisions to the UK trade balance between Quarter 1 (Jan to Mar) 2017 and Quarter 2 (Apr to June) 2018 range from a downward revision of £1.7 billion to the total trade deficit in Quarter 3 (July to Sept) 2017 to an upward revision of £2.8 billion in Quarter 1 2018.

Table 1 shows the Blue Book 2018 and the data previously published in the Second estimate of GDP: January to March 2018 for exports, imports and the trade balance.

Figure 17 shows the trade balance for Blue Book 2018 and Pink Book 2018 compared with the data previously published in the Second estimate of GDP: January to March 2018. The upwards revision of £2.9 billion in Quarter 1 2018 is mostly driven by trade in goods.

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 that 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 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.

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 2017.

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