There’s a chill in the air and we’ve officially entered the months that end in -er, which can only mean one thing: The year is coming to a close. I know, it’s a bitter pill to swallow. But it means we’re able to look at how the international trade landscape has evolved since January and how it will continue to evolve as we enter 2025. Analysis and forecasting are essential to making sure your business is prepared for whatever the new year has to bring.
Looking Back: 2023 & 2024
Following a 2021-2022 spike of recovery from a 2020 pandemic-induced decline, international trade saw a gradual dip in 2023. Or really, a return to the steady rate it had sat at for five years prior. Overall, the value of international trade was around $31 trillion by the conclusion of 2023.1 Of that total, North Dakota contributed $8.8 billion in foreign exports and $4.7 billion in imports.2
2024 saw a smooth, gradual growth in goods traded during Q1 and Q2.3 This is predicted to continue as the year wraps up. UN Trade and Development (UNCTAD) accredits this year’s success to positive trade dynamics between the US and other developing countries.
Trade in 2023 and 2024 has been heavily influenced by an increase in demand for green energy products and AI related computers.3 Additionally, the many straining conflicts that have intensified or arisen in the past four quarters. Powerhouse importers and exporters—like the US, Canada, and China—have had to navigate the regulations, tariffs, and delays that have resulted. Still, numbers have continued to rise, and manufacturing rates are soaring.4
Looking Ahead: 2025
Can we expect the current, prosperous state of trade to continue into 2025? The Organization for Economic Cooperation and Development (OECD) says yes. Even better, they predict global trade of goods and services to grow by 3.3%.5 This heavily depends on whether inflation continues to fall. But this is looking probable, the US and other leading trade countries having already overcome the impact of serious economic setbacks such as the pandemic and Russia-Ukraine war.
However, the OECD expects China and East Asia to promote the most global economic growth. It’s also looking like trade will thrive within the global East/West rather than between them—geopolitical issues and tariffs diminishing the potential for expansion.
The World Trade Center’s (WTO) Global Trade Outlook and Statistics report from April 2024 states that there could be fragmentation in trade flows due to disruptions in the Suez and Panama Canals.6 Over 70% of the Panama Canal’s traffic is destined for or originates from the US. North Dakota utilizes the canal for a portion of our soybean exports, so the freshwater shortages that are hindering the efficiency of trade could indirectly hurt our economy.
Still, there’s a lot to look forward to as 2025 nears. There’s also a lot of time left for your business to prepare for any bumps in the road. If you haven’t already read up on the 2025 trade forecast, the ITA, WTO, and UN are watching any developments that may influence exports closely.
As 2024 winds down and 2025 looms, it’s the perfect time to take stock of all your accomplishments and failures in exporting from the past few months. What can you do differently? How can you overcome the turbulence ahead? As always, the NDTO is here to help your business stay on track. Lots has changed since the beginning of this year, but we’re on top of all your export needs. Here’s to a new year on the horizon!
1 https://unctad.org/system/files/official-document/ditctab2024d1_en.pdf
2 State Trade and Economy Factsheets
3 https://unctad.org/system/files/official-document/ditcinf2024d2.pdf
4 World Manufacturing Production (unido.org)
5 Global trade growth could increase two-fold or more in 2024 | World Economic Forum (weforum.org)