The automotive industry recorded the largest drop in the World Trade Organization (WTO) Trade in Goods Barometer.
In particular, the auto products index (85.9) fell below trend, due to a shortage of semiconductors, which hampered vehicle production worldwide.
This shortage was also reflected in the electronic components index (99.6), which went from above trend to trend.
Meanwhile, the container shipping (100.3) and raw materials (100.0) indices also returned to approach their recent trends. Only the air cargo index (106.1) remained firmly above trend, as shippers sought substitutes for ocean freight.
The Merchandise Trade Barometer is an advanced composite indicator of world trade that provides real-time information on the trajectory of merchandise trade in relation to recent trends.
As the latest 99.5 reading is close to the 100 benchmark, it indicates growth in line with recent trends.
But it also represents a sharp drop from the previous reading of 110.4 last August, suggesting a reduction in the pace of quarterly business expansion.
The barometer decline reflects a combination of declining import demand and the disruption of production and supply of widely traded goods, such as automobiles and semiconductors.
North America would lower its motor vehicle production by 21.9% in 2021 compared to 2020 due to the shortage of semiconductors, projected the consultancy Autoforecast Solutions (AFS)
Until the end of October of this year, this loss of production had reached 2 million 629,000 units and the consultancy estimates that this figure would potentially escalate to 2 million 934,000 units.
The automotive industry is one of the sectors most integrated into global value chains worldwide.
“Following its strong rebound from the initial impact of the Covid-19 pandemic, global merchandise trade is slowing, with production and supply disruptions in critical sectors slowing growth and cooling import demand,” said the WTO.
The latest barometer reading broadly coincides with the revised WTO trade forecast of October 4, which predicted a growth in the volume of world merchandise trade of 10.8% in 2021, compared to 8.0% in March, followed by a 4.7% increase in 2022.
Furthermore, the forecast showed a slowdown in quarterly trade growth in the second half of 2021 as merchandise trade volume approached its pre-pandemic trend.