Singapore exports shrink again in May but by smaller-than-expected 1.2%

The PSA Tanjong Pagar Terminal on April 11, 2017.
The PSA Tanjong Pagar Terminal on April 11, 2017.ST PHOTO: KUA CHEE SIONG

SINGAPORE - Singapore's non-oil domestic exports (NODX) contracted year-on-year in May for a second straight month but the decline was smaller than expected thanks to strong electronics demand, according to data released by International Enterprise (IE) Singapore on Friday (June 16).

NODX fell 1.2 per cent from a year earlier after shrinking a revised 0.8 per cent in April. Before April, exports had grown strongly for five straight months, led by electronics.

May's decline was lower than the 5.6 per cent drop expected by economists polled by Bloomberg.

Analysts said they anticipated a fall in May, due to a high base from 12 months earlier, when exports jumped by double-digits.

On a month-on-month and seasonally adjusted basis, May exports rose 8.1 per cent from April, almost double the 4.1 per cent forecast by analysts. In April, shipments had fallen 9 per cent over March.

Year-on-year, electronic shipments expanded by 23.3 per cent in May, following the 4.8 per cent increase in the previous month. ICs, PCs and parts of PCs grew by 31.2 per cent, 64.7 per cent and 26.2 per cent respectively, and they contributed the most to the growth in electronic domestic exports.

In contrast, non-electronic exports fell 9 per cent, after a 2.9 per cent decline in the previous month,  partly due to a high base of comparison. Civil engineering equipment parts, non-monetary gold and pharmaceuticals decreased by 92.5 per cent, 24.6 per cent and 14.2 per cent respectively, contributing the most to the decline in non-electronic NODX.

ANZ economist Ng Wei Wen said May's data "reinforces our view of a two-speed trajectory within Singapore’s export and manufacturing cycle". 

"Specifically, Singapore’s electronic exports have been strong, continuing to expand for the seventh straight month. By contrast, non-electronic exports have softened in recent months," he said.

The firm electronic exports and output in recent months may partly reflect inventory building ahead of high-profile smart phone launch later this year, he added.

Shipments to the Singapore's top 10 export markets, except for Hong Kong, expanded in May. The largest contributors to the increase were China (+36.4 per cent), South Korea (+64.3 per cent) and the European Union (+16.2 per cent).

Notably, exports to China, Singapore's biggest single market, surged by 36.4 per cent, better than the previous month's growth of 10.9 per cent, with the biggest boost coming from the 139.8 per cent jump in sales of gold, followed by ICs (+62.6 per cent) and petrochemicals (+35.2 per cent).

Shipments to the EU, the country's second-largest market, rose by 16.2 per cent, recovering from the 36 per cent plunge in April, due to pharmaceuticals (+8.3 per cent), specialised machinery (+137.7 per cent) and measuring instruments (+45.3 per cent).

Exports to the US eked out a 1.7 per cent gain after falling 9.6 per cent in April.

NODX to emerging markets increased by 1.1 per cent, following the 4.4 per cent growth in the previous month. The rise was due mainly to Latin America (+67.2 per cent), South Asia (+26 per cent) and the non-EU countries of Eastern & Southern Europe (+165 per cent).