U.S. Total Trade Likely To Surpass Eye-Popping $5 Trillion In 2022

U.S. merchandise trade with the world is on track to surpass an eye-popping $5 trillion in 2022, according to the latest U.S. Census Bureau data.

Total U.S. trade only surpassed $4 trillion for the first time in 2018, four years ago. It took 11 years for total U.S. trade to surpass $3 trillion after first topping $2 trillion.

Imports are likely to surpass $3 trillion this year for the first time and exports likely to surpass $2 trillion for the first time.

As you might have already surmised, the trade deficit will indeed surpass $1 trillion but that happened for the first time in 2021, as I previously wrote.

This surge in trade, which is likely to be worth about $875 billion over the 2021 total, appears likely to occur despite an ongoing trade war with China that predates the presidency of Joe Biden but because of the Russian invasion of Ukraine.

That invasion created additional snags and shortages in the supply chain — in fertilizer, in grains and in petroleum products — because of the importance of Russia and Ukraine in those export markets.

That, in turn, led to big increases in the price of oil, gasoline and natural gas on global markets which, in turn, led to an awakening of long-dormant inflation just as the world tried to return to normalcy after the Covid-19 pandemic, fattened with massive government infusions of easy money.

It appears massive, multi-year tariffs on U.S. imports from China, a trade fight between the world’s two largest economies, had little impact while war, even a bungled and sloppy invasion by one country with a relatively small economy against a second country, with an even smaller economy, really mattered. And matters still.

Sometimes trade records fall because things are going really well, because economies are buoyant. Sometimes, it appears, they fall because there is peril in the global economy.

Through September, U.S. trade stood a whisker below $4 trillion, at $3,997,419,843,333. That’s an increase of 19.74% over the record pace from the previous year. Trade tends to pick up slightly in the last quarter of the year and could end up in the neighborhood of $5.3 trillion.

Because inflation remains stubbornly high, much to the consternation of the Federal Reserve, it is highly unlikely that a drop in oil and gasoline prices in December could be significant enough to keep total trade below the $5 trillion mark.

The value of oil, gas and natural gas trade accounted for about 12% of all U.S. exports and imports through September.

Oil is the leading U.S. import, refined petroleum products like gasoline rank seventh, and LNG and other natural gas rank 22nd, though that is an increase from 48th a year ago at this time. On the export side, refined petroleum, oil and natural gas rank first, second and third, respectively.