Panjiva reports decline in global trade activity from August to September

Global trade patterns from August to September showed sequential declines and annual gains, according to data released by Panjiva, an online search engine with detailed information on global suppliers and manufacturers.

U.S.-bound waterborne shipments, which were up 9 percent from June to July and down 3 percent from July to August, dropped 4 percent from August to September at 1,103,045, according to Panjiva. September shipments were up 7 percent on an annual basis.

The 3 percent sequential decline was in line with previous years for the same period, with 2011 down 8 percent, 2010 down 7 percent and 2009 and 2009 up down 5 percent and up 5 percent, respectively.

Panjva reported a 4 percent decrease in the number of global manufacturers shipping to the U.S., with September hitting 150,410, and worse than the 1 percent decrease from July to August. The number of manufacturers shipping to the U.S. was up 6 percent year-over-year. And the 1 percent sequential decrease is better than 2011’s 8 percent decrease and 2010 and 2009 down 5 and 7 percent, respectively.

In an interview, Panjiva CEO Josh Green said that these September numbers in a sense show a sign of relief when compared to the August data, considering that August is typically the peak month for shipments but it was down compared to July this year.

“It appeared in looking at that data earlier in the year leading up to holiday season that it would have suggested that businesses weren’t feeling particularly confident about what the holiday season had in store for us,” said Green. “But in looking at these numbers, what they seem to suggest is that it is not so much of a slowdown as a shift later orders. What seems to be the case is that [shippers] held off as long as they could in making their buying decisions, hoping there would be more clarity about where the economy is headed. And as a result we are seeing shipments coming later in the year relative to what we have seen in the past.”

Last month, Green said that there was a fair amount of speculation regarding global trade softening, which is off-set by those who maintain the economy is heading in the right direction, coupled with mixed messages in terms of where the macro economy is headed, He added that it is possible there is softness in global trade in response to global macro economic conditions.

And one month later he said that still appears to be the case, as the September numbers bolster the argument that a shift in orders is occurring more so than a global trade slowdown.

“It is a combination of those two things, and the scary part is that these numbers suggest that in the last couple of months businesses are betting on a solid holiday season, not a great one, not a terrible one,” said Green. “And as we start turning our attention to 2013, there is some real uncertainty in the market—certainly about the trajectory of the global economy and the uncertainty that exists because of the U.S. political process and the threat of the fiscal cliff.”

Should the fiscal cliff come to fruition, the subsequent impact on global trade could be a major concern, according to Green. The reason, he said, is that trade in some sense depends on anticipation about what the future holds.

As an example, he said if a business is making buying decisions based on the expectations of where the economy will be several months into the future, the uncertainty that looms due to political policy is already impacting decisions businesses are making regarding trade activity.

“If businesses anticipate slowdowns because of political gridlock, that slowdown can materialize even if a political crisis is averted at the last minute,” he said.