1.1. Trade in Goods1.1. Trade in Goods

Exports

Exports measure the total physical movement of merchandise out of the United States to foreign countries whether such merchandise is exported from within the U.S. Customs Territory or from a U.S. Customs bonded warehouse or a U.S. Foreign Trade Zone. Information on exports of merchandise from the U.S. to all countries, except Canada, is compiled from the U.S. exporter’s Electronic Export Information (EEI) as submitted to the U.S. Automated Export System (AES). These submissions are made online via secure computer connections with both the U.S. Census and the U.S. Customs and Border Protection. Canadian import statistics are used to measure U.S. exports to Canada, while Canadian exports to the U.S. are based on U.S. imports from Canada.

Total Exports is the sum of two types of exports:

1. Domestic Exports – Commodities grown, produced or manufactured in the U.S., including commodities imported from foreign countries that have been significantly changed or enhanced in value, in either the United States or a Foreign Trade Zone.
    

2. Foreign Exports (Re-exports) – Commodities of foreign origin that have entered the U.S. but are "re-exported" in substantially the same condition as when imported.

Imports

Imports include commodities of foreign origin or domestically produced goods that are returned to the United States with no change in condition or after having been processed and/or assembled in other countries.

There are two measurement styles for imports:

1. General Imports - This number measures the total value of merchandise shipments that arrive in the U.S. from foreign countries, whether such merchandise enters consumption channels immediately or is entered into bonded warehouses or U.S. Foreign Trade Zones under Customs custody.

2. Imports for Consumption - This number measures the total value of merchandise that physically clears Customs, or goods withdrawn from Customs bonded warehouses or U.S. Foreign Trade Zones, which immediately enter consumption channels. Merchandise being held in bonded warehouses or U.S. Foreign Trade Zones is not included until it is specifically withdrawn for consumption.

Trade Balance

The U.S. merchandise trade balance is calculated as “Total Exports” (i.e. "domestic exports" plus "foreign exports") less “General Imports” (all imports that arrive in the U.S. aside from those transiting under bond) because these numbers reflect the most comprehensive measure of goods entering and leaving the United States. This calculation follows U.N. statistical guidelines and is used by the World Trade Organization and the majority of nations.  

This methodology ensures that all goods entering and leaving the United States are accounted for. "Foreign exports" are counted as an import when they enter the country and an export when they leave.  

This is similar to how a company balances its books. If it purchases (imports) a good from another company and then resells (re‐exports) the good, it will count both transactions when balancing its books.

Other methodologies, such as using "domestic exports" and  "imports for consumption", exclude some traded goods and therefore do not accurately reflect the U.N. recommended and  most widely accepted measure of the U.S. trade balance and often inflate the trade deficit.

For example, using the figures below from 2014, the U.N. recommended calculation of the trade balance results in a $722 billion merchandise trade deficit:



A calculation that uses "domestic exports" and "imports for consumption" produces a larger deficit of $912 billion largely because "foreign exports" (re-exports) are excluded on the export side of the equation, but included on the import side:



Using "domestic exports" rather than total exports also excludes from the trade balance the value of U.S. inputs such as distribution, packaging, testing or assembly in "foreign exports".