Chart I.-YEARLY MERCHANDISE AND COMBINED MERCHANDISE, GOLD AND SILVER EXPORTS FROM AND IMPORTS INTO THE UNITED STATES Table 1.-Exports, Imports, and Balance of Trade of the United States Table 2. Increase or Decrease of Foreign Trade in 1924 as Compared with Pre-War Average and Postwar Years The export trade of 1924 was greater than in any preceding year since 1920. The fact that the exports were about 44 per cent less than in 1920 is largely attributable to the decline in prices. The value of imports in 1924, while lower than in the preceding year, had previously been exceeded only in the two years 1919 and 1920, in both of which the higher figures were due entirely to much higher prices. While the excess of exports of merchandise over imports was much greater in 1924 than in either of the two preceding years, it was much less than during any year from 1915 to 1921, the peculiar conditions of the war period having resulted in altogether abnormal export surpluses. Comparison with Pre-War Trade. For the purpose of comparison of recent with pre-war figures, the five-year period from 1910 to 1914 (fiscal years) may be taken as a base, or the single years 1913 or 1914. Trade was increasing year by year before the war, so that the average for the five-year period is materially lower than the figure for either of its last two individual years. The fiscal year 1913 was the peak pre-war year for exports, and 1914 the peak year for imports. Exports in 1924 were 86.2 per cent greater in value than in 1913; 94.2 per cent greater than in 1914; and 112 per cent greater than the 1910-1914 average. The increase in value of imports has been more marked, the 1924 figures exceeding that of 1913 by 99.1 per cent, of 1914 by 90.6 per cent, and the average 1910-1914 by 113.8 per cent. While these increases have been in considerable part due to higher prices there has been a definite growth in the physical volume of trade in both directions. Some commodities such as cotton and lumber are moving abroad in smaller quantities than prior to the war but most leading export commodities show increases over the pre-war period. The increase in imports, in terms of quantity, has been considerably greater. Nearly all items for which quantity data are available (principally raw materials and tropical foodstuffs) have been brought in in decidedly and, for some in enormously, larger quantities during the last two or three years than prior to the war. Export prices, however, have risen more than import prices. Making due allowance for the influence of price changes, the trends of the statistics for a longer period of time, as shown in Table 1, seem to indicate that the present level of the volume, as distinguished from the value, of imports is somewhat higher than would have been the case had the pre-war rate of growth continued without interruption by the war. On the other hand, exports do not appear quite to have reached the level that would have been reached by this time had the average rate of increase for the 10 or 15 years prior to the war continued. The changes which have taken place in the past 10 years, however, are only in part an actual result of the war, although the diminished buying power of Europe has been an important factor in checking the growth of our exports. The great expansion of our automobile and silk industries and of other industries requiring raw materials from abroad has increased our demand for many foreign products. Our higher standards of living and general prosperous condition have given rise to greater demands for tropical foodstuffs and other semiluxuries. Unfavorable conditions in many parts of the world have made the United States the market most worth the active competition of foreign sellers. On the other hand, the continued growth in our consuming population tends to require a greater share of our production of raw materials and foodstuffs for home use. The reduction of the cotton crop through the boll weevil has also tended to check the growth of total exports. BALANCE OF TRADE While thus the quantities of imports show greater increase as compared with pre-war years than the quantities of exports, the fact that the average prices of imported goods show less advance than those of exported goods has enabled the United States still to maintain a large excess of exports over imports in value (a so-called favorable balance). The average excess of merchandise exports over imports for 1910-1914 was $477,000,000 annually as compared with $980,000,000 in 1924, and the highest pre-war excess of exports, that for the fiscal year 1913, was $653,000,000. A truer comparison, however, is on a percentage basis. For 1910-1914 the value of imports was equal to 78 per cent of the value of exports, while for 1924 the corresponding ratio was 78.6 per cent, a comparatively slight change. The striking contrast between 1924 and 1923 has already been pointed out. Part of the large surplus of exports over imports during recent years has been paid for by foreigners in gold (see Table 1). The United States, as a large producer of silver, which is here used in only moder ate quantities for currency, is normally an exporter of that metal, although in several recent years imports of silver have exceeded exports. The movements of gold during the war years and the first year or two after the war were greatly affected by artificial influences connected with the financing of the war. Since 1920 there has each year been an excess of imports. The net imports of gold in 1924 were $258,000,000, or 12 per cent less than in 1923, somewhat greater than in 1922, much less than in 1921, and contrasting with a slight excess of gold exports during the five years preceding the war. Of merchandise, gold, and silver taken together, the excess of exports in 1924 was $758,000,000, nine times greater than in the preceding year. Data concerning international balance of payments, as affected by invisible exports and imports, are not yet available for 1924, but some idea as to the importance of these items may be obtained from statistics for 1923 shown in Table 3. Table 3.—Estimated Balance of International Payments of the United States, 1922 and 1923 Includes $42,000,000 for parcel-post packages and $1,435,000 for supplies sold by War Department in 1923 and $36,000,000 for parcel post in 1922. 2 Includes $30,000,000 for smuggled liquors. 3 Includes interest received by United States Government. • Except interest and principal of allied debt; does not include ordinary expenses of officials abroad. Domestic and Foreign Exports. The United States, unlike the United Kingdom, Germany, the Netherlands, and some other foreign countries, is not to any very great extent an entrepôt in international trade. Our imports are almost entirely for our own consumption and practically the whole of our export trade is of domestic merchandise. (See Table 1.) Exports of foreign goods that have entered into manufacture and been changed in form are considered exports of domestic merchandise. The exports of domestic merchandise in 1924 amounted to $4,498,000,000 and those of foreign merchandise to $93,000,000. The foreign exports show a greater percentage of increase over 1923 and over the pre-war years than the domestic exports show, but in absolute figures these changes affect the total trade but little. Free and Dutiable Imports. The proportion of imports free of duty in 1924 was 57.6 per cent as compared with 56.3 per cent in 1923. (See Table 1.) There was no change in the list of free commodities, and the variation is attributable to changes in the relative importance of different individual articles imported. On the other hand, the number of items free of duty at present was somewhat greater before September, 1922, and this goes to explain the higher percentage of free imports, 60.1 per cent in 1922. The value of dutiable imports in 1924 was 7.6 per cent 5 less than in 1924, while there was a decrease of 2.6 per cent in imports free of duty. Trend of Trade by Months. Table 4 and Chart II show merchandise exports and imports by months since 1920. Some of the minor variations are attributable to the number of days in the calendar month; March for example naturally shows annually a heavier trade than the much shorter month of February. Price changes affect the monthly movements as well as changes in quantities. There is a normal tendency— obscured in the case of the year 1921 by the sharp downward cyclical movement toward a seasonal increase of exports during the last four or five months of the year, due to the movement of large quantities of breadstuffs and of cotton from the new harvest.) The up-swing of exports in the fall was more noticeable in 1924 than in either 1922 or 1923. Owing to the combination of comparatively poor harvests in Europe, a poor harvest in Canada, and an abundant harvest in the United States, largely increased quantities of breadstuffs were shipped at advancing prices. At the same time the quantity of cotton exported, while at somewhat lower prices rose greatly. The total value of all exports in October was nearly double that in July, exceeding any preceding month back to January, 1921. The exports for the last quarter of 1924 totaled $1,464,000,000, or nearly 20 per cent more than in the corresponding quarter of 1923. 39799-25†- -2 |