Trade statistics are an important source of information for the exporter. Trade statistics can tell you if your product is needed in different parts of the world, if your product is already being exported and how much is being exported and where your competition lies. There are different types of trade statistics, each providing different insights that when used together, can provide an in-depth understanding of a country’s trade patterns and trends. All of these statistics provide the exporter with valuable insight into:
- Market identification – highlighting potential new markets to enter.
- Market size and growth – highlighting trends in the market for specific products. This is important fore strategic planning.
- Competitor analysis and identification – just as it’s important to know what your local competitors are offering, international competitor analysis is important as it may highlight a company’s competitive strengths or weaknesses.
- Demand trends – Changes in import and export volumes over time can indicate trends in demand, providing insights into potential future opportunities or risks.
- Pricing insights – Some trade statistics can also include data on the average prices of goods being imported and exported. This knowledge can be useful for setting a benchmark for a company’s international pricing strategy.
- Policy impact assessment – They can help evaluate the impact of trade policies, such as tariffs or quotas, on the volume and value of trade. This is useful for advocacy work and for planning around potential policy changes.
- Risk assessment – Significant changes in trade volumes over time can indicate economic or political instability in a market, helping exporters to assess and manage risks.
- Supply chain planning – Information on the export of certain product categories can feed into decisions about supply chain management, such as sourcing, production, and logistics.
- Relationship Building – If trade between countries is shown to have a high intensity, this can indicate a strong trade relationship between them. This knowledge can be leveraged to further strengthen ties, negotiate better trade terms, and build lasting business partnerships.
Some of these different types are described below:
IMPORT AND EXPORT STATISTICS
These statistics show the value and volume of goods and services that a country imports and exports. Their importance lies in the fact that they provide crucial data that can inform a wide range of strategic decisions, from identifying potential markets and assessing demand trends, to analyzing competition, setting prices, and evaluating trade policies and risks.
BILATERAL TRADE STATISTICS
Bilateral trade statistics show the value and volume of trade between two specific countries. The information these statistics provide enable a detailed understanding of the trading relationship between two countries, which can inform a wide range of strategic decisions and help to identify potential opportunities and risks.
PRODUCT CATEGORY STATISTICS
As the name implies, these describe trade data by the type of product. Here different classification systems are often used such as the Harmonised System (HS) or Standard Industrialised Categories (SIC) codes.
SERVICE CATEGORY STATISTICS
Just as product category statistics describe trade data by the type of product, service category statistics describe trade data according to type of service. Examples are tourism, transportation and business services. An exporter of services will find these statistics valuable in making strategic decisions such as identifying market opportunities and analyzing competition, to understanding policy implications, tracking market trends, setting prices, and assessing potential risks.
COMMODITY TRADE STATISTICS
These statistics describe trade data by type of commodity. This is different from product category statistics in that products refer to goods or services for consumption or use such as cars or furniture. Product statistics are typically more detailed, reflecting the wide variety of different goods and services that are traded internationally. Commodities refer to a type of good that is uniform in quality and characteristics across producers and is typically traded in bulk on exchanges such as oil, gold, coal and wheat. Commodity statistics, on the other hand, focus on a narrower range of homogenous, raw materials that are often subject to global price fluctuations based on supply and demand dynamics in commodity markets. The insights obtained from these statistics are useful to the commodity exporter for making strategic decisions on pricing, market selection, risk management and strategic planning.
TRADE BALANCE STATISTICS
These statistics show the difference between a country’s total value of exports and its total value of imports, indicating whether it has a trade surplus or a trade deficit. Trade balance statistics serve as a key indicator of economic health and global competitiveness and are important for guiding strategic decisions for exporters. They help identify market opportunities, influence foreign direct investment decisions, and highlight potential policy implications. In addition, these statistics aid in risk management by signaling economic stability or instability.
REGIONAL BALANCE STATISTICS
These statistics show the value and volume of trade with specific regions, such as the European Union, AGOA, ASEAN, or NAFTA/USMCA regions. Regional balance statistics are important for an exporter’s strategic planning. They can help to identify potential growth markets, understand the impacts of regional trade agreements, and managing potential risks arising from economic or political instability specifically within a region.
INTRA-INDUSTRY STATISTICS
These statistics focus on the trade within similar goods or services within an industry. Intra-industry trade statistics help to identify primary competitors, discover potential new markets, inform decisions about production and pricing, inspire innovation for product improvement, and predict potential risks associated with political or economic instability in trading countries or regions.
TRADE INTENSITY STATISTICS
A country’s total trade is compared to that of another country with the purpose of determining the intensiveness of that trade. These statistics highlight which markets should be prioritised based on the importance of specific markets for the exporter’s products. They assist in risk management by highlighting potential vulnerabilities related to economic or political instability in highly engaged trade partners. These statistics also aid in strengthening trade relationships and negotiating better trade terms. Furthermore, they inform decisions around production planning, pricing, marketing strategies, and can elucidate the potential impacts of policy changes in countries with high trade intensity with exporter’s country.