Singapore’s non-oil domestic exports (NODX) expanded by 17.9% in October, extending the 12.0% growth in September and beating the median estimate of 15.1% in a private Bloomberg poll.
The growth in October also marks the 11th straight month of Singapore’s NODX expansion.
According to official data released by Enterprise Singapore (ESG) on Nov 17, the higher NODX was thanks to growth in both the electronics and non-electronics sectors.
During the month, electronic exports expanded by 14.9% y-o-y, extending the 14.1% increase in September. Integrated circuits (ICs), personal computers (PCs) and diodes & transistors rose by 22.6%, 18.1% and 19.8% respectively, making these the top three contributors to the growth in electronic NODX.
Non-electronic exports also grew by 18.9% y-o-y, following the 11.4% y-o-y rise in September. The rise was mainly contributed by the higher y-o-y growth in non-monetary gold exports, specialised machinery and petrochemicals at 223.2%, 49.3%and 39.1% respectively.
On a seasonally adjusted month-on-month (m-o-m) basis, NODX rose by 4.2% in October to $16.4 billion, following September’s 1.0% increase. Both electronic and non-electronic NODX also grew on a m-o-m basis.
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Singapore’s NODX to its top 10 markets rose on the whole in October, with the biggest contributors being China (+35.6%), Malaysia (+29.4%) and Taiwan (+32.7%).
NODX to China grew due to non-monetary gold, specialized machinery and petrochemicals, while NODX to Malaysia expanded thanks to ICs, non-monetary gold and diodes & transistors.
NODX to Taiwan grew due to ICs, specialized machinery and petrochemicals.
Meanwhile, NODX to Thailand, the US and Hong Kong declined in October.
See: ESG adjusts 2021 NODX estimates upwards to 7.0% to 8.0% on better-than-expected growth in 2Q
NODX to emerging markets rose by 42.5% in October, mainly due to exports to Cambodia, Laos, Myanmar and Vietnam (+112.3% collectively), South Asia (+28.5%) and the Middle East (+22.8%).
Oil domestic exports rose by 60.3% y-o-y in October from a low base in 2020, and contributed by higher exports to Australia (+196.4%), Malaysia (+61.6%) and Indonesia (+53.3%).
The figure follows the 51.1% expansion logged in September.
In volume terms, oil domestic exports fell by 13.1% y-o-y following the 11.2% y-o-y decrease in September.
On a m-o-m basis, oil domestic exports expanded by 13.2% in October, after the 5.9% decrease in Se
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Non-oil re-exports (NORX) grew 17.8% y-o-y in October, extending the 16.4% increase in September. October’s increase was due to growth in both electronics and non-electronics.
Electronic NORX expanded by 15.7% in October mainly due to ICs (+14.3%), telecommunications equipment (+26.2%) and PCs (+44.3%).
Non-electronic NORX grew by 20.4% in October, mainly contributed by non-electric engines & motors (+76.7%), non-monetary gold (+175.2%) and specialised machinery (+52.0%).
On a m-o-m basis, NORX grew by 4.7% to $28.9 billion in October, after the 0.5% decline in September. During the month, electronic NORX declined while non-electronic NORX rose.
NORX to the top 10 markets grew in October, with the top three contributors being Malaysia (+32.6%), China (+13.8%) and Indonesia (+44.9%).
Total trade for October was up by 24.0% y-o-y, extending the 18.6% y-o-y growth in the previous month.
Total exports rose by 22.7%, while total imports expanded by 25.6%.
On a m-o-m basis, total trade rose by 5.4% to $100.9 billion.
Total exports grew by 6.1% m-o-m, while total imports fell 4.6% m-o-m.
Looking ahead, CGS-CIMB Research economist Terence Lee says he expects specialised machinery, "specifically those used in chip production, to stay strong in the medium-term".
Meanwhile, the global chip shortage is likely to persist into well into next year, providing a boon for Singaporean electronics, he adds.
On Singapore's October NODX to its top 10 countries, Lee notes that concerns over China's slowdown may pose risks to Singapore's NODX performance. Year-to-date (y-t-d), China accounts for some 18.8% of Singapore's NODX.
"However, this potential shortfall could be mitigated by reopening prospects in neighbouring countries. For example, NODX to Malaysia and Indonesia improved in October 2021," says Lee, who attributes this to a further relaxation in movement restrictions in both countries.
The faster pace of growth for non-electronics NODX in October 2021 has reaffirmed UOB's view that the August contraction was temporary, notes UOB senior economist Alvin Liew.
"October’s NODX and overall trade numbers continued to affirm the recovery in global trade demand and underpin Singapore’s growth outlook for 2021. And as we have highlighted in last month’s report, we recognise a relatively low base print of -0.5% in 4Q2020 as compared to full-year 2020 NODX growth of 4.4%," he writes.
"That low base of 4Q2020 coupled with the export growth momentum seen year-to-date, we see that there is a risk that NODX will expand beyond the 10.3% y-t-d average in 2021 which would surpass both our forecast of 9.5% and Enterprise Singapore’s full-year growth outlook of between 7.0% - 8.0%," he adds.
The Singapore research team at RHB Group Research says it expects growth momentum for NODX to "steadily pickup" towards the last two months of the year.
"External demand should remain resilient given recovery in broad-based economic activities, particularly in major trading partners like China. Moreover, the expected increase in consumer spending related to new tech products and the holiday season should provide support to export momentum," writes the team.
"However, downside risk stems from global supply chain disruption attributed to supply shocks and disrupted production of widely traded goods, among others. This is expected to continue well into 1H2022 and may slowdown potentially slowdown trade growth henceforward," it adds.
"Over the course of 3Q2021, the underlying momentum in NODX has slowed and, with supply chain bottlenecks looking to ease over the next few months, we remain hopeful that exports will soon lift," says JP Morgan analyst Ong Sin Beng.
Photo: Bloomberg
