An increasing number of homegrown companies are finding that their “Made in Alabama” products are ending up in markets around the world.
The value of Alabama exports exceeded $19.5 billion in 2014, an increase of 115 percent over a decade. Manufactured goods accounted for virtually of all of the state’s exports in 2014, led by products such as automobiles, machinery, primary metals, chemicals and aircraft parts.
Alabama-made products were shipped to nearly 200 countries around the world in 2014, reflecting the state’s strong global connection and its well-developed export support system.
“Export growth means more production and jobs,” said Brian Davis, director of the Alabama International Trade Center at the University of Alabama. “As companies grow, this spurs overall economic growth in the state.”
Here’s a look at the trends driving Alabama’s export machine:
- Canada remained the No. 1 destination for Alabama products in 2014, with exports valued at $4.2 billion. Alabama-made vehicles and auto parts accounted for nearly two-thirds of the total, followed by primary metals and chemicals, according to data from the International Trade Administration (ITA).
- Canada’s status as Alabama’s top export destination is threated by surging shipments to China, which rose to the No. 2 spot in 2014. Alabama exports totaled $3.2 billion, up 28 percent from 2013 and 708 percent over a decade. Top Alabama exports to China in 2014 were transportation equipment (64 percent of the total) and chemicals (23 percent), ITA data show.
- Over the past decade, Alabama exports to Mexico have risen 220 percent, while exports to Brazil have climbed 206 percent. Primary metals were the No. 1 item shipped to Mexico in 2014, accounting for nearly 39 percent of the total, according to ITA data. For Brazil, the top categories are minerals and chemicals, which represented nearly two-thirds of all shipments in 2014.
- Alabama-made vehicles have powered big export gains over the years. In 2014, $6.6 billion in vehicles were exported, up from $1.8 billion a decade earlier – a 267 percent increase. In 2014, vehicle exports went to 99 countries around the world, according to data from the Alabama Department of Commerce.
- Several countries are showing a growing appetite for Alabama-made vehicles. Automobiles worth more than $83 million were shipped to Russia in 2014, an increase of 156 percent from the previous year. Shipments to the United Arab Emirates have nearly doubled in two years, hitting $107.6 million in 2014. Shipments to South Korea jumped 54 percent that year.
- Other Alabama export categories have been gaining momentum. Between 2009 and 2014, exports of primary metals climbed 114 percent, while exports of wood products jumped 71 percent, ITA data shows. Overseas shipments of chemicals – Alabama’s No. 2 export category — rose 22 percent over that time frame, hitting $2.4 billion.
About 44 percent, or $8.5 billion, of Alabama’s exports in 2014 went to countries with Free Trade Agreements with the United States. These include Canada, Mexico, South Korea, Australia and Colombia. Exports to Japan, which declined 7 percent between 2004 and 2014, could get a boost from the passage of the proposed Trans-Pacific Partnership trade agreement, according to Kenichiro Sasae, Japan’s ambassador to the U.S.
“There will be better market access ahead,” Sasae told the Birmingham Business Journal while in the city for a major international conference, SEUS Japan. “To the extent that Alabama is dependent on exports, that would help.”
Nearly 4,000 Alabama firms, many of them small enterprises, now export their goods.
“More and more smaller firms are getting involved like never before,” said Davis of the Alabama International Trade Center. “They are not afraid of exporting and can pursue opportunities quickly. Exporting used to be the exclusive domain of large companies. But it’s easier and more commonplace to do business overseas now.”
Increasing exports is seen as a priority of Governor Robert Bentley and his administration. Boosting overseas shipments of Alabama-made goods was listed as a goal in Accelerate Alabama, the state’s strategic economic development growth plan unveiled in 2012. The ITA estimates that exports support more than 95,000 Alabama jobs.
“When you look at the commodities we export and where we export to, it’s a good thing for us,” said Sam Addy, director of the Center for Business and Economic Research at the University of Alabama.