October export orders contract 6.3%

WORLD TURMOIL:
Orders for the full year could dip into negative territory if external uncertainties, including surging inflation, continue to weigh on demand, an official said

  • By Lisa Wang / Staff reporter

Export orders dropped at the fastest pace in about three years at 6.3 percent annually to US$55.4 billion last month amid a deteriorating macroeconomy, the Ministry of Economic Affairs said yesterday.

The pace of decline topped the ministry’s expectation of an annual drop of 3.6 percent.

With external uncertainties — surging inflation, a global economic downturn and China’s “zero COVID” policy — continuing to weigh on demand, export orders are forecast to see a steeper decline of between 14.5 percent and 17.6 percent annually this month, the ministry said.

Photo: NAC

That would translate into orders of US$54 billion to US$56 billion and mark a third consecutive month of annual contraction, the ministry projected.

“There is a 50 percent chance that export orders for the full year would decline from last year,” Department of Statistics Director Huang Yu-ling (黃于玲) said by telephone.

“November’s performance is crucial. If the results come in closer to the high end of our forecast, there would be a smaller chance that they would dip into negative territory for the full year,” she said.

During the first 10 months of this year, export orders rose 1.4 percent annually to US$564.47 billion, ministry data showed.

Taiwan has not experienced a decline in annual export orders since 2019, when they shrank 5.3 percent, ministry data showed.

Last month, orders for electronics products expanded 9.6 percent annually to US$18.86 billion, driven by increasing demand for chips used in 5G-related applications, high-performance computing devices and automotive electronics.

RESTOCKING

Inventory restocking demand ahead of the year-end shopping sprees also helped, the ministry said.

On a monthly basis, orders for electronic goods slide 8.7 percent.

Orders for information and communications technology products edged down 0.3 percent annually and 9.4 percent monthly to US$18.45 billion, as demand weakened amid inventory adjustments in the supply chain, the ministry said.

Rising demand for newly launched smartphones and networking devices was offset by a decline in orders for notebook computers and graphic cards, it said.

Orders for optoelectronics, including flat-panel displays, dropped 43.4 percent annually and 13.2 percent monthly to US$1.47 billion last month due to sluggish demand for displays used in TVs and notebook computers, as well as lower average selling prices, the ministry said.

Base metal orders plunged 35.6 percent annually and 6 percent monthly to US$2.1 billion on the back of to weak demand for steel products, while orders for machine tools fell 25.3 percent annually and 12.5 percent monthly to US$1.69 billion, as manufacturers became more conservative about capital-spending.

Inventory adjustments also caused orders for plastic products to plummet 38.3 percent annually and 8.5 percent monthly to US$1.62 billion, ministry data showed.

Petrochemical products also fell 31 percent annually and 9.5 percent monthly to US$1.51 billion, the data showed.

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