The year-on-year (YoY) growth in trade values for manufactured goods in the first three quarters of 2021 was 5 percent for clothing and minus 7 percent for textiles, according to the World Trade Organisation (WTO), which recently said despite strong headwinds contributing to the overall decline in merchandise trade in the third quarter, trade volume was still up by 11.9 percent YoY during the period.
The textiles category includes surgical masks, which surged earlier in the pandemic. The higher baseline for these products may explain their decline in the third quarter, WTO said.
The forecast of a 10.8 percent increase in merchandise trade for 2021 could still be achieved if volume growth picks up in the fourth quarter. This is a real possibility since measures to unblock container ports on the US West Coast met with some success, WTO said.
“Nevertheless, the emergence of the Omicron variant of SARS-CoV-2 appears to have tipped the balance of risks towards the downside, increasing the chance of a more negative outcome,” the multilateral trade body noted.
The main reason for the dip in merchandise trade volume in the third quarter was weaker than forecasted imports in North America and Europe. This translated into reduced exports from those regions and also from Asia. Asian imports contracted in the third quarter, but this decline was anticipated in the October trade forecast.
In contrast to volume, the value of world merchandise trade continued to climb in the third quarter as export and import prices rose sharply.