UK trade: June 2016

Total value of UK imports and exports of goods together with indices of volume and price, including an early monthly estimate of the value of trade in services

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9 August 2016 12:47

A correction has been made to section 4 Summary of latest UK trade statistics. In the second paragraph, 'a £0.7 billion increase in cars (to a record quarterly high of £0.7 billion)' has been changed to 'a £0.7 billion increase in cars (to a record quarterly high of £7.5 billion)'.

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Contact:
Email Katherine Kent

Release date:
9 August 2016

Next release:
9 September 2016

1. Main points for June 2016

UK trade shows import and export activity and is a main contributor to the overall economic growth of the UK. All data are shown on a seasonally adjusted, balance of payments basis, at current prices unless otherwise stated.

The UK’s deficit on trade in goods and services was estimated to have been £5.1 billion in June 2016, a widening of £0.9 billion from May 2016. Exports increased by £1.0 billion and imports increased by £1.9 billion. Imports reached a record high of £48.9 billion.

The deficit on trade in goods was £12.4 billion in June 2016, widening by £0.9 billion from May 2016. This widening reflected an increase in exports of £1.0 billion to £24.6 billion and an increase in imports of £1.8 billion to £37.0 billion.

Between Quarter 1 (January to March) 2016 and Quarter 2 (April to June) 2016, the total trade deficit for goods and services widened by £0.4 billion to £12.5 billion.

Between Quarter 1 2016 and Quarter 2 2016 the deficit on trade in goods widened by £0.1 billion to a deficit of £34.4 billion. Exports increased by £4.1 billion (5.8%) and imports increased by £4.1 billion (4.0%).

Between Quarter 1 2016 and Quarter 2 2016, the UK’s trade in goods deficit with the EU widened by £0.4 billion to £23.9 billion. Between Quarter 1 2016 and Quarter 2 2016, the UK’s trade in goods deficit with countries outside the EU narrowed by £0.3 billion to £10.4 billion, attributed to an increase in exports (6.2%).

Between Quarter 1 2016 and Quarter 2 2016, the trade in services surplus narrowed by £0.4 billion to £21.9 billion, as exports decreased by £0.3 billion.

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2. Main figures for June 2016

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3. Understanding and working with UK trade statistics

Short guide to UK trade

UK trade shows the extent of import and export activity and is an important contributor to the overall economic growth of the UK. Trade is measured through both imports and exports of goods and/or services. Data are supplied by over 30 sources including several administrative sources, HM Revenue and Customs (HMRC) being the largest.

This monthly release contains tables showing the total value of trade in goods together with index numbers of volume and price. Figures are analysed by broad commodity group (values and indices) and according to geographical area (values only). In addition, the UK trade statistical bulletin also includes early monthly estimates of the value of trade in services.

This bulletin focuses on trade in goods as it is easier to quantify and measure due to the coverage and comprehensiveness of the administrative data sources available. Trade in services is more difficult to measure, and source data are provided mainly on a quarterly or annual basis, principally from ITIS (International Trade in Services survey). Monthly estimates are derived using this quarterly data; therefore, the data are less robust on a monthly basis compared with goods.

As more information becomes available on trade in services this bulletin will focus on the values, volumes and geographic breakdown on a 3 month cycle described below:

Month Trade in services detail
March, June, October, December Focus on the estimated quarterly change in exports and imports of services by the main types of service
January, April, July, October Focus on trade in services in volume terms
February, May, October, November Focus on trade in services with EU and selected non-EU countries

Our website

The UK trade methodology web pages can now be found on our website. These have been developed to provide detailed information about the methods used to produce UK trade statistics. Any recent user requested trade data are also included on our website.

Understanding UK trade

We make every effort to provide informative commentary on the data in this release. Where possible, the commentary draws on evidence from other sources of information to help explain possible reasons behind the observed changes. However, in some instances it can prove difficult to draw out detailed reasons for movements; consequently, it is not possible for all data movements to be fully explained.

Trade statistics for any 1 month can be volatile. For that reason, it is recommended to compare the latest 3 months against the preceding 3 months and the same 3 months of the previous year.

When examining the trade in goods data, oil and “erratics” (high value, low volume products) are removed from some analysis as they can make a large contribution to trade in goods as a whole. Therefore we publish data inclusive and exclusive of these categories. We also provide a separate analysis of oil because it is subject to erratic price fluctuations and therefore volume data are provided in metric tonnes as well as value (£ billion).

Strengths and weaknesses of the data

Strengths

Quality of trade in goods data

The quality of the source data for trade in goods is high in terms of the timeliness, comprehensiveness and coverage, and this level of quality compares well internationally. The data are used across government, business and academia and feed into a number of other outputs and publications, including gross domestic product and balance of payments. The Bank of England uses the total figures to make policy decisions, whereas government departments such as the Foreign and Commonwealth Office are interested in the individual country detail.

We have frequent communication with our suppliers to discuss quality, including regular meetings, telephone conversations and email correspondence. Service level agreements are in place to define the level of quality expected in the data received and these are reviewed annually. Data suppliers have their own internal quality assurance processes to meet the quality standards outlined in the service level agreements and we work closely with them to understand these. Suppliers are required to advise us of any changes to the collection or processing of the data to ensure our expectations are still met.

When data are received by the trade team we conduct our own initial quality assurance. Further quality analysis is then conducted at several stages of processing; this is detailed in a process map and quality assurance plan. If there are any quality concerns we work closely with the supplier to address these.

We have regular discussions with users on the quality of our data and provide comprehensive explanations of the terms, methodology and processes we use. Eurostat is an important customer influence and helps improve the quality of our data through task force meetings and by producing quality guidelines.

Timeliness of publications

The UK trade publication is very timely (generally 40 days after the period to which it refers), helping to inform policy and to assess UK economic performance.

Weaknesses

Quality and timeliness of trade in services data

Where trade in goods has 1 main data supplier, there are a large number of suppliers of trade in services data. Additionally, a number are voluntary, so it can be difficult to establish and maintain the same quality assurance processes and relationships with these businesses or suppliers.

Due to the collection methods and complexities of quantifying trade in services, data are less timely than trade in goods estimates. The data are processed quarterly, so monthly forecasts are made to provide a complete trade total.

Monthly volatility

Trade statistics for any one month can be erratic. For that reason, we recommend comparing the latest 3 months against the preceding 3 months and the same 3 months of the previous year. However, we also recognise the importance to users of an early estimate of trade therefore we continue to produce a monthly estimate.

UK trade National Statistics suspension

Due to a series of errors during 2014, the UK Statistics Authority suspended the National Statistics designation of UK trade on 14 November 2014. The Authority's reassessment of UK trade against the Code of Practice for Official Statistics has been completed. We are committed to meeting the requirements and regaining National Statistics status for UK trade as soon as possible and will keep users informed of progress.

One of the recommendations of the reassessment was to consult with users on the use of UK trade statistics. The results of this user engagement survey can be found on our website.

To provide feedback on the bulletin please contact us via email trade@ons.gsi.gov.uk.

The trade development plan has now been launched.

UK trade re-assessment update

We have now addressed some of the requirements of the re-assessment of UK trade and are in the final stages of providing evidence on the remaining requirements. In doing so, we are working with the Assessment Team to evaluate whether any additional evidence will be required as a result of the independent review of UK economic statistics led by Professor Sir Charles Bean.

Due to user demand we have included a UK trade EU section which includes an EU exports, imports and percentages of World total table.

Definitions and explanations

A glossary of terms is published in the UK trade glossary and the UK Balance of Payments, The Pink Book 2016.

Nonmonetary gold

According to internationally agreed standards, nonmonetary gold held in allocated accounts is recorded as a good; therefore, gold of this type which is being stored as a financial asset is recognised under trade in goods when ownership changes between a resident and non-resident.

Data are collected by the Bank of England from the London Bullion Market on holdings of nonmonetary gold. Working alongside the Bank of England and the London Bullion Market Association, we have implemented a method for smoothing the source data, effectively minimising volatility whilst enabling the underlying trend of the gold market to be reflected in the trade balance.

Estimates for trade in nonmonetary gold still remain volatile compared with other commodities and, as such, it is classified under erratics.

Use of the data

UK trade is a main economic indicator due to the importance of international trade to the UK economy. It is also a very timely statistic, providing an early indicator of what is happening more generally in the economy.

In addition, it is a major component of 2 other main economic indicators: UK gross domestic product (GDP) and the UK balance of payments. This means that there is a threefold potential for UK trade statistics to inform the government’s view of the UK economy, as well as the views of others, such as economists, city analysts, academics, the media and international organisations.

Notes on tables

Rounding:

The sum of constituent items in tables does not always agree exactly with the totals shown due to rounding.

Symbols:

.. Not applicable

- Nil or less than half the final digit shown

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4. Summary of latest UK trade statistics

Quarterly analysis

Between Quarter 1 (January to March) 2016 and Quarter 2 (April to June) 2016, the total trade deficit (goods and services) widened by £0.4 billion to £12.5 billion. The trade position reflects exports minus imports; the widening of the deficit was attributed to a slightly larger increase in imports than exports. Total imports rose to a record high of £144.0 billion.

The deficit on trade in goods widened by £0.1 billion to a deficit of £34.4 billion between Quarter 1 2016 and Quarter 2 2016. Exports of goods increased by £4.1 billion (5.8%), to £74.0 billion. This increase reflected a £1.3 billion increase in aircraft to a record high of £4.6 billion, a £0.7 billion increase to machinery, a £0.7 billion increase in cars (to a record quarterly high of £7.5 billion) and a £0.5 billion increase in exports of oil. Imports increased by £4.1 billion (4.0%) due to a £0.8 billion increase in machinery; a £0.6 billion increase in both material manufactures and aircraft; and a £0.9 billion increase both in food, beverages and tobacco and oil. These increases were partially offset by a £0.5 billion decrease in imports of miscellaneous manufactures and a £0.3 billion decrease in jewellery.

Between Quarter 1 2016 and Quarter 2 2016, exports of goods to EU countries increased by £1.8 billion due to exports of cars, increasing by £0.4 billion to a record quarterly high of £3.2 billion; oil increased by £0.3 billion and both machinery and chemicals increased by £0.2 billion each. For the same period, imports from the EU increased by £2.2 billion to a record quarterly high of £59.4 billion. This increase reflected a £0.8 billion increase in food, beverages and tobacco; a £0.4 billion increase in machinery; a £0.3 billion increase in oil; and a £0.1 billion increase in aircraft to a record high of £0.9 billion. These increases were offset by a decrease in works of art of £0.2 billion. This resulted in a widening of the trade in goods deficit with EU countries by £0.4 billion.

There was a trade in goods deficit with non-EU countries of £10.4 billion in Quarter 2 2016, a narrowing of £0.3 billion from Quarter 1 2016. Exports of goods to countries outside the EU rose by £2.2 billion; this was the result of a £0.5 billion increase in machinery; a £1.1 billion increase in aircraft to a record quarterly high of £2.7 billion; a £0.2 billion increase in cars; and a £0.2 billion increase in both oil and chemicals. These increases were offset by a £0.4 billion fall in material manufactures. Imports of goods from countries outside the EU rose by £1.9 billion; most notably there was an increase in imports of oil by £0.7 billion and aircraft which increased by £0.5 billion. This increase was offset by a decrease in miscellaneous manufactures of £0.5 billion.

Monthly analysis

The deficit on trade in goods and services in June 2016 was £5.1 billion, compared with a deficit of £4.2 billion in May 2016. The widening of the deficit reflects an increase in imports, partially offset by an increase in exports between May 2016 and June 2016.

Between May 2016 and June 2016, total exports (goods and services) increased by £1.0 billion (2.4%) to £43.8 billion; this increase comprised a £1.0 billion (4.0%) increase in the exports of goods and a £0.1 billion (0.3%) increase in the export of services. Total imports (goods and services) increased by £1.9 billion (4.0%) to £48.9 billion over the same period, reflecting a £1.8 billion (5.2%) rise in imports of goods.

The deficit on trade in goods was £12.4 billion in June 2016, widening by £0.9 billion from May 2016. This widening reflected an increase in imports of goods; imports of oil increased £0.7 billion and increasing in imports of chemicals, aircraft and material manufactures of £0.4 billion each. Over the same period, exports of goods rose reflecting increases in exports of oil of £0.4 billion and chemicals of £0.2 billion.

Between May 2016 and June 2016, exports of goods to EU countries increased by £0.5 billion (4.7%) to £12.0 billion, mainly reflecting an increase in exports of oil (£0.5 billion). Imports of goods from EU countries increased by £0.8 billion to a record high of £20.3 billion in June 2016, as imports of machinery and transport equipment rose £0.4 billion.

Between May 2016 and June 2016, exports of goods to countries outside the EU increased by £0.4 billion. Imports of goods from countries outside the EU increased by £1.0 billion, reflecting a £0.7 billion increase in imports of oil from Norway.

Revisions

The earliest date for revisions to goods and services was April 2016. The total trade (goods and services) deficit for April 2016 has been revised up by £1.2 billion. This is attributed to a £1.0 billion upwards revision to imports of EU goods. Manufactures was revised up by £0.9 billion.

The total trade deficit for May 2016 has been revised up by £2.0 billion. This is attributed to a £0.9 billion upwards revision to imports from countries outside the EU and a £0.7 billion upwards revision to imports from the EU. Imports of unspecified goods was revised up by £0.9 billion and manufactures up by £0.7 billion.

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5. Longer-term perspective

International comparisons

Trade – both imports and exports – as a ratio of GDP varied widely across G7 economies over the past 16 years, as shown by Figure 2. This measure can be interpreted as a measure of openness or reliance on trade, indicating substantial differences between these economies. However, this will also reflect other factors, such as a country’s geographic size and location.

While the UK’s ratio has increased from 49.1% in 1999 to 56.7% in 2015, it remained toward the middle of the range of G7 economies for the entire period. Over this time, UK exports have increased relative to GDP from 23.7% to 27.3%, while imports increased from 25.3% to 29.4%. In every year UK imports have made up a larger proportion of GDP than exports, reflecting the UK’s trade deficit over this period.

While the proportion of UK trade has remained fairly stable as a proportion of GDP over this period, other G7 countries’ proportions have changed substantially. German exports and imports have grown faster than GDP, indicating an increased importance of trade to the German economy. While exports and imports were broadly equal in 1999, over time German exports grew much faster than imports resulting in a trade surplus. In 2015, exports were 46.9% of GDP, while imports were 39.1%, both of which were the largest proportions in the G7. As a result, total trade in Germany has grown as a proportion of GDP from 53.4% in 1999 to 86.0% in 2015.

The USA and Japan have been less reliant on trade than other G7 countries. In 1999, the USA’s trade was 22.8% of their GDP, while Japan’s trade was 18.8%. The US saw slight growth over time, resulting in total trade equal to 27.8% of GDP in 2015. Japan experienced stronger growth, as total trade almost doubled to 36.8% of GDP. Even with Japan’s increased openness to trade, both countries’ proportions of exports and imports are still somewhat below the other G7 countries.

UK trade with the EU

In 2015, exports of goods and services to the EU accounted for 44.0% of the total exports. The proportion is closer to half for exports of goods (47.0%) and just under two-fifths (39.0%) for trade in services. The share of exports has fallen by more than 10 percentage points over the last 15 years.

Rotterdam effect

In this context users should note the “Rotterdam effect”, where goods initially exported to 1 country are subsequently re-exported to another country. This might overstate the share of exports going to a particular country, in this case the Netherlands, and therefore overstate the share of exports going to the EU.

It is not possible to quantify the Rotterdam effect precisely, but an article exploring this issue was published in 2015. The article used 2013 data to estimate the effect, and made an assumption that 50% of all goods exports to the Netherlands were re-exported to non-EU countries. Using this assumption, the Rotterdam effect would account for around 4 percentage points of the UK’s exports of goods. These effects were calculated to illustrate the possible size of the Rotterdam effect. The Rotterdam effect applies only to trade in goods. The 4 percentage points estimate therefore applies to the share of the exports of goods only.

When considering the total exports of goods and services to the EU – the 44.0% figure quoted in Table 2 – the Rotterdam effect is estimated at around 2 percentage points. It is also important to note that the Rotterdam effect could also affect the UK’s imports. However, these estimates were calculated to illustrate the possible size of the Rotterdam effect and do not imply that a different data series should be produced or used.

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6. Value of UK trade in goods

Monthly analysis

In June 2016, the UK’s deficit on trade in goods was £12.4 billion, widening by £0.9 billion from May 2016.

Exports increased by £1.0 billion (4.0%) to £24.6 billion in June 2016, from £23.6 billion in May 2016.

In detail:

  • oil rose by £0.4 billion

  • chemicals rose by £0.2 billion

  • machinery and transport equipment rose by £0.2 billion

Imports increased by £1.8 billion (5.2%) to £37.0 billion in June 2016, from £35.2 billion in May 2016.

In detail:

  • oil rose by £0.7 billion

  • machinery and transport equipment rose by £0.7 billion

  • chemicals rose by £0.4 billion

Quarterly analysis

In Quarter 2 (April to June) 2016, the deficit on trade in goods was £34.4 billion, widening by £0.1 billion from Quarter 1 (January to March) 2016.

Exports increased by £4.1 billion (5.8 %) to £74.0 billion between Quarter 1 2016 and Quarter 2 2016.

In detail:

  • machinery and transport equipment rose by £2.6 billion ( of which road vehicles rose by £0.7 billion and aircraft increased £1.3 billion)

  • oil rose by £0.5 billion

  • chemicals rose by £0.3 billion

Imports increased by £4.1 billion (4.0 %) to £108.4 billion between Quarter 1 2016 and Quarter 2 2016.

In detail:

  • machinery and transport equipment rose by £1.9 billion

  • semi-manufactures rose by £1.0 billion

  • oil rose by £0.9 billion

At the main commodity level, the data are shown in Table 3.

Where to find data about UK trade in goods

The value of trade in goods figures are available in Table 1 and commodity figures are available in Tables 8, 9 and 10 of the dataset.

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7. Trade in goods – analysis by area

In June 2016, the deficit on trade in goods with EU countries widened by £0.3 billion to £8.3 billion. The deficit on trade in goods with non-EU countries widened by £0.6 billion to £4.2 billion (Figure 5).

EU analysis

Between May 2016 and June 2016, exports to the EU increased by £0.5 billion (4.7%) to £12.0 billion. This was attributed to an increase in exports to the Netherlands of £0.3 billion and to both France and Germany of £0.1 billion each.

Between May 2016 and June 2016, imports from the EU increased by £0.8 billion (4.3%) to £20.3 billion. This was attributed to increases in imports from the Netherlands of £0.3 billion and from both France and Germany of £0.2 billion each.

Between Quarter 1 (January to March) 2016 and Quarter 2 (April to June) 2016, exports to the EU increased by £1.8 billion (5.4%) to £35.4 billion. This was attributed to an increase in exports to France of £0.6 billion, to the Irish Republic of £0.4 billion and an increase to Belgium and Luxembourg (combined) of £0.2 billion.

Between Quarter 1 2016 and Quarter 2 2016, imports from the EU increased by £2.2 billion (3.9%) to £59.4 billion. This was attributed to an increase in imports from Germany of £0.6 billion, from both Belgium and Luxembourg (combined) and Poland of £0.3 billion each and from France, Italy and Spain of £0.2 billion each.

At the commodity level, the data are shown in Table 4.

Non-EU analysis

Between May 2016 and June 2016, exports to non-EU countries increased by £0.4 billion (3.4%) to £12.6 billion. This was attributed to an increase in exports to both Switzerland and the USA of £0.2 billion each.

Between May 2016 and June 2016, imports from non-EU countries increased by £1.0 billion (6.4%) to £16.7 billion. This was attributed to an increase in imports from Norway of £0.7 billion and from the USA of £0.3 billion.

Between Quarter 1 2016 and Quarter 2 2016, exports to non-EU countries increased by £2.2 billion (6.2%) to £38.6 billion. This was attributed to increases in exports to the USA of £1.4 billion and Saudi Arabia of £0.8 billion.

Between Quarter 1 2016 and Quarter 2 2016, imports from non-EU countries increased by £1.9 billion (4.1%) to £49.0 billion. This was attributed to increases in imports from China of £2.2 billion; anecdotal evidence suggests there were increases in imports of telecommunications equipment and aircraft. Imports to South Korea and Turkey both increased by £0.4 billion each. These increases were partially offset by a decrease in imports from Canada of £1.2 billion and from the USA of £1.1 billion.

At the commodity level, the data are shown in Table 5.

Where to find data about UK trade in goods – analysis by area

Trade in goods by area figures are available in Table 2 and value of trade in goods with selected EU and non-EU trading partner figures are available in Tables 11 and 12 of the dataset.

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8. Trade in goods – geographical analysis

Monthly analysis

The USA was the UK’s top export partner with exports of £4.0 billion in June 2016, an increase of £0.2 billion when compared with May 2016.

Germany was the UK’s top import partner with imports of £5.6 billion in June 2016, an increase of £0.2 billion when compared with May 2016.

Quarterly Analysis

In Quarter 2 (April to June) 2016, the USA was the UK’s top export partner with exports of £12.1 billion, an increase of £1.4 billion when compared with Quarter 1 (January to March) 2016.

In Quarter 2 2016, Germany was the UK’s top import partner with imports of £16.1 billion, an increase of £0.6 billion when compared with Quarter 1 2016.

Where to find data about UK trade in goods – geographical analysis

Trade in goods by area figures are available in Table 2 and value of trade in goods with selected EU and non-EU trading partner figures are available in Tables 11 and 12 of the dataset.

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9. Volume of trade in goods, excluding oil and erratics

Between May 2016 and June 2016, the volume of exports increased by 0.9%.

Between May 2016 and June 2016, the volume of imports increased by 1.1%.

Between Quarter 1 (January to March) 2016 and Quarter 2 (April to June) 2016, the volume of exports increased by 1.5%.

Between Quarter 1) 2016 and Quarter 2 2016, the volume of imports increased by 1.6%.

At the commodity level, the data are shown in Table 8.

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10. Export and import prices for trade in goods (not seasonally adjusted)

In June 2016, compared with May 2016, export prices increased by 2.1% and import prices increased by 1.9%. Excluding the oil price effect, export prices increased by 1.6% and import prices increased by 1.1%.

Between Quarter 1 2016 and Quarter 2 2016, export prices increased by 3.4% and import prices increased by 0.5%. Excluding the oil price effect, export prices increased by 1.9% and import prices decreased by 1.0%.

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11. Trade in oil

In June 2016, the balance of trade in oil was in deficit by £0.7 billion, a widening of £0.3 billion from May 2016. Oil exports increased by £0.4 billion to £1.8 billion and oil imports increased by £0.7 billion to £2.5 billion.

In Quarter 2 (April to June) 2016, the balance on trade in oil was in deficit by £1.6 billion, widening by £0.4 billion from Quarter 1 (January to March) 2016. Oil exports increased by £0.5 billion to £4.7 billion and oil imports increased by £0.9 billion to £6.4 billion.

Where to find data about trade in oil

The trade in oil figures are available in Tables 1 and 7 of the dataset.

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12. Trade in services

Information on trade in services is mainly obtained from quarterly surveys, in some cases underpinned by larger annual surveys. This means that the latest months are uncertain. For further information see section 3 (Strengths and weaknesses of the data).

Between May 2016 and June 2016, the estimated surplus on trade in services rose by £26.0 million to £7.3 billion. Exports were estimated to have been £19.2 billion and imports £11.9 billion.

In Quarter 2 (April to June) 2016, the surplus on trade in services was £21.9 billion: financial services (£10.4 billion), other business services (£5.7 billion) and insurance services (£3.6 billion) had the largest surpluses.

Between Quarter 1 (January to March) 2016 and Quarter 2 2016, exports of services decreased by £0.3 billion to £57.6 billion. The main contributors to this decrease were telecommunication, computer and information services (£0.5 billion), manufacturing and maintenance services (£0.3 billion), insurance and pension services (£0.2 billion) and financial services (£0.2 billion). This decrease was partially offset by an increase in other business services of £0.7 billion. For the same period, imports of services increased by £22.0 million to £35.7 billion. The main contributor to this increase was travel services with an increase of £0.5 billion. This increase was partially offset by decreases within other business services (£0.2 billion), transport services (£0.1 billion), construction services (£0.1 billion) and manufacturing and maintenance (£0.1 billion).

Where to find data about trade in services

The trade in services figures are available in Table 1 CONT. of the dataset.

A quarterly breakdown of trade in services by selected countries can be found in the Quarter 1 (January to March) 2016 United Kingdom Economic Accounts.

More detail on trade in services by type of service and partner county can be found in the annual UK Balance of payments, The Pink Book: 2016.

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13. Where to find more information about UK trade statistics

Other regularly published UK trade releases

Supplementary quarterly data, analysed by product according to the UK trade in goods by classification of product by activity (CPA 2008), are also available.

The latest release on 14 June 2016 covered the period Quarter 1 (January to March) 2016 and the data are consistent with UK trade: May 2016. Following an internal review of our publications and a wider survey of users there is no longer a statistical bulletin associated with the release.

The data will be updated at the next publication on 14 September 2016 to be fully consistent with the UK Balance of Payments, The Pink Book: 2016 and UK National Accounts, The Blue Book: 2016 datasets.

The complete run of data in the tables of this statistical bulletin are also available to view and download in other electronic formats free of charge using our time series data website service. You can download the complete statistical bulletin in a choice of zipped formats, or view and download your own selections of individual series.

HM Revenue and Customs (HMRC) publish Overseas Trade Statistics (OTS) on the same day as we release the UK trade data each month. These aggregate estimates will differ slightly from those that are published by us as part of the Balance of Payments (BoP), as the 2 sets of data are compiled to different sets of rules. The BoP publication shows a high level picture of UK trade in goods, whereas the OTS publication shows a detailed picture of the UK’s trade in goods by commodity and partner country.

Recently published reports on UK trade topics

On 5 August 2016, we published a short story on the UK trade and investment relationship with South America.

On 29 July 2016, we published the annual UK Balance of Payments, The Pink Book: 2016 which, as well as containing more detailed information on trade, also provided an overview of the trade deficit in relation to the current account deficit.

We have published a methodology article estimating the value of service exports abroad from different parts of the UK. This work has been undertaken to meet user needs for sub-national estimates for exports of services. The article provides annual estimates for 2011 to 2014, including breakdowns by region, commodity and industry, which at this stage are considered experimental. We welcome feedback on the article and the proposed methodology.

The Economic Review published 6 April 2016 contains information on trade as a percentage of GDP.

The Economic Review published 3 February 2016 includes analysis of trade with EU and non-EU countries.

On 29 January 2016 annual International trade in services survey results for 2014 were published. This release gives information on the industry of the businesses engaged in trade in services.

Historic articles published on UK trade

In our Economic Review published on 3 September 2015 there is further commentary on UK export performance.

On 1 September 2015, we published an article on the economic performance of the UK’s motor vehicle manufacturing industry.

On 26 June 2015, we published a short story on the importance of EU to UK trade and investment.

On 9 June 2015, we published a short story on the importance of China to the UK economy, including the value of the UK trade with China.

On 6 February 2015, we published an article on the Rotterdam effect and its potential impact on the UK trade in goods estimates.

On 23 January 2015, we published a short story exploring the reasons behind the UK trade deficit.

Published user requested data and analysis

Additional statistical data and analyses for UK trade statistics that have not been included in our standard publications are available at the user requested data and analysis pages on our website.

Methodological articles

Detailed methodological notes are published in the UK Balance of Payments, The Pink Book: 2016.

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14. Revisions to trade statistics

Trade in goods revisions

The revision period for trade in goods and services is May 2016 to June 2016, in-line with the National Accounts revision policy.

Methodology changes

Change to the way HMRC trade in goods statistics are compiled

From June 2016 month of account there has been a methodological change to the way HM Revenue and Customs (HMRC) compiles non-EU statistics.

Following a change in legislation, non-EU trade in goods statistics will move from the general trade system of compilation to the special trade system. In brief, special trade records the physical movement of goods to and from the UK, but excludes goods that are placed into customs warehouse where duty and VAT has not yet been paid.

This change has had minimal impact on our trade in goods statistics as we previously applied adjustments to remove those goods held in customs warehouse from our data; the only change we have made is the removal of these adjustments.

A full announcement from HMRC is available on their website.

Gas

HMRC Trade Statistics have amended the data source used in the compilation of natural gas traded with non-EU partners from 2011 onwards. Imports of gas have been revised upwards by approximately £3.0 billion in each year 2011 to 2013. This change had already been incorporated from 2014 onwards.

Imputed rental on second homes (cross-border property income)

Wider national accounts changes to imputed rental have impacted on the imports and exports of housing services arising from imputed rental of second homes by non-residents which form part of travel services. The revision to trade balance from 1997 onwards vary between negative £0.4 billion and positive £0.6 billion.

Exhaustiveness

Improved estimates of non-complicit Value Added Tax (VAT fraud) has an indirect effect on trade in services. Exports of services have been revised up by less than £0.1 billion each year.

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15. Accuracy of the statistics

Accuracy

Trade in goods figures for the most recent months are provisional and subject to revision in the light of:

  • late trader data

  • revisions to seasonal adjustment factors which are re-estimated every month

Trade in services estimates have been derived from a number of monthly and quarterly sources. For components where no monthly data are available, estimates have been derived on the basis of recent trends. The results should be used with appropriate caution, as they are likely to be less reliable than those for trade in goods.

Reliability

Revisions to data provide one indication of its reliability. Table 9 shows summary information on the size and direction of the revisions that have been made to the data covering a 5-year period. A statistical test has been applied to the average revision to find out if it is statistically significantly different from zero. An asterisk (*) shows that the test is significant.

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16. Other quality information

UK trade re-assessment

The UK Statistics Authority suspended the National Statistics designation of UK trade on 14 November 2014. The Authority's re-assessment of UK trade against the Code of Practice for Official Statistics has been completed.

One of the recommendations of the re-assessment was to consult with users on the use of UK trade statistics. The results of this user engagement survey can be found on our website.

UK trade re-assessment update

We have now addressed some of the requirements of the re-assessment of UK trade and are in the final stages of providing evidence on the remaining requirements. In doing so, we are working with the Assessment Team to evaluate whether any additional evidence will be required as a result of the Independent review of UK economic statistics, led by Professor Sir Charles Bean.

Trade development plan

The UK trade development plan has now been launched.

EMU enlargement

As of 1 January 2015, Lithuania joined the European Monetary Union (EMU). Therefore the EMU totals in this UK trade release include Lithuania.

EMU coverage

The coverage of EMU countries was extended to cover Cyprus and Malta from October 2008, Slovakia from January 2009, Estonia from January 2011, Latvia from January 2014 and Lithuania from January 2015. Some EU and non-EU breakdowns of commodity data for chained volume measures which are available on request may be less reliable than the current price data. Please consult Katherine Kent on +44 (0)1633 455829 if you are considering using them.

Data have been combined for the United States and Puerto Rico and for Dubai, Abu Dhabi and Sharjah (the United Arab Emirates) from January 2009 onwards. Estimates are separately available for the United States and Dubai up to the end of 2008 on request.

Erratics

Non-monetary gold is now included in the erratics series, along with ships, aircraft, precious stones and silver. In compliance with the BPM6 changes, non-monetary gold which is held as a store of wealth is now recorded within trade in goods.

Deflation

It is common for the value of a group of financial transactions to be measured in several time periods. The values measured will include both the change in the volume sold and the effect of the change of prices over that year. Deflation is the process whereby the effect of price change is removed from a set of values.

Chain-linked indices (chained volume measures), which are indexed to form the volume series in this bulletin, differ from fixed base indices in that the growth from 1 year to the next is estimated by weighting the components using the contribution to value of trade in the immediately preceding year (effectively re-basing every year). This series of annually re-weighted annual growths is then “chain-linked” to produce a continuous series.

The implied price deflators, derived by comparing current price data to chained volume measures data are not the same as the price indices published in this statistical bulletin, because the former are current weighted while the latter are base (2012) weighted.

Changes in trade associated with VAT MTIC fraud mean that comparisons of volume and prices (both including and excluding trade associated with VAT MTIC fraud) should be treated with a great deal of caution.

Interpreting the data

In months where quarterly and 3-monthly ending percentage changes for index data coincide, there may be small differences between the data for methodological reasons. Quarterly data are the indexed form of an underlying constant price (for volume indices) or consistent quantity (for price indices) series. 3-month ending data are the average of the index data in that period.

Seasonal adjustment

Seasonal adjustment aims to remove effects associated with the time of the year or the arrangement of the calendar so that movements within a time series may be more easily interpreted.

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17. Records sheet

The UK trade record information for June 2016 can be accessed on our website.

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18 .Background notes

  1. What’s new

    As announced on 22 July 2016, an error was identified in the calculation of the UK trade price indices for the months of April and May 2016 published in the UK trade: May 2016 release.

    Detailed investigations into the cause of the error identified a further related issue in the level of the same UK trade price indices from the beginning of 2014.

    These previous errors in the published UK trade export and import price indices, affecting the join between 2013 and 2014 and the months of April and May 2016, have been corrected in this bulletin.

    Also, as set out in the UK trade development plan, we are undertaking a range of improvements to the development of UK trade statistics. These include enhanced scrutiny and quality assurance of the data and improvements to the processing systems. These developments are ongoing, but have already begun to highlight areas for future development, which includes potential improvements to some published trade prices such as oil.

    Comparisons between the published UK trade prices and the implied deflators, that can be calculated by dividing current price trade data by the volume equivalents, has been a further area of focus. We have been investigating the underlying data and processes applied to calculate the published price and volume data. These processes are quite complex and the aggregate series are the result of a combination of effects. Some areas for improvement have been identified to bring greater consistency between implied deflators and published prices, which have been shown to become divergent from the beginning of 2015 for a small subset of series. These improvements will be applied, in line with normal practice, at the earliest opportunity in line with the Code of Practice for Official Statistics and the National Accounts revisions policy.

    At this stage the intention is to introduce further improvements in the UK trade: July 2016 statistical release on 9 September 2016.

  2. Code of Practice for Official Statistics

    National Statistics are produced to high professional standards set out in the Code of Practice for Official Statistics. They undergo regular quality assurance reviews to ensure that they meet customer needs. They are produced free from any political interference.

  3. Quality and methodology information report

    A quality and methodology information report for this statistical bulletin and associated data can be found on our website.

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Contact details for this Statistical bulletin

Katherine Kent
trade.in.goods@ons.gsi.gov.uk
Telephone: +44 (0)1633 455829