Machinery

Changes in 2021 from 2020:

• U.S. total exports: Increased by $20.7 billion (16.3 percent) to $147.8 billion
  • U.S. domestic exports: Increased by $16.5 billion (15.4 percent) to $123.2 billion
  • U.S. re-exports: Increased by $4.2 billion (20.8 percent) to $24.5 billion
• U.S. general imports: Increased by $43.6 billion (21.3 percent) to $248.4 billion

The value of U.S. domestic exports of machinery^[1] rose by $16.5 billion (15.4 percent) to $123.2 billion in 2021.^[2] The majority of sector digests saw export growth, with the largest increases in the following: semiconductor manufacturing equipment (up $6.7 billion or 29.0 percent); farm and garden machinery and equipment (up $1.9 billion or 23.8 percent); miscellaneous machinery (up $1.3 billion or 14.5 percent); centrifuges and filtering and purifying equipment (up $1.1 billion or 14.3 percent); and nonautomotive insulated electrical wire and related products (up $0.8 billion or 17.7 percent). The growth in exports benefitted from the overall global economic recovery following the COVID-19 pandemic’s initial slowdown, including rising demand for residential construction and greater investment in electrical infrastructure. Canada was the top export destination in 2021 with an increase in U.S. exports of $3.0 billion (15.1 percent) to $22.9 billion. U.S. exports to Mexico grew by $2.4 billion (16.6 percent) to $16.7 billion, while exports to China rose by $2.6 billion (23.0 percent) to $13.9 billion.

The value of U.S. general imports of machinery increased by $43.6 billion (21.3 percent) to $248.4 billion in 2021.^[3] Although almost every sector digest saw growth in import value in 2021, over half of the growth was seen in the following five sector digests: household appliances (up $7.9 billion or 25.1 percent); air-conditioning equipment and parts (up $4.8 billion or 24.3 percent); farm and garden machinery and equipment (up $3.3 billion or 34.7 percent); nonautomotive insulated electrical wire and related products (up $2.5 billion or 27.6 percent); and portable electric handtools (up $1.7 billion or 31.5 percent). A recovery of the U.S. economy from slowdown related to the COVID-19 pandemic, along with rising demand in residential construction and increases in disposable income, largely drove the import growth in these categories. China remained the top source of U.S. imports of machinery with an increase of $8.6 billion (17.3 percent) to $58.3 billion in 2021. Imports of machinery from Mexico grew by $7.2 billion (21.4 percent) and from Germany by $2.9 billion (15.6 percent).

U.S. Domestic Exports

U.S. exports of semiconductor manufacturing equipment (SME) increased by $6.7 billion (29.0 percent) to $29.7 billion in 2021.^[4] The 29.0 percent growth in U.S. exports was in line with the estimated 39.0 percent rise in global sales of SME.^[5] Strong demand for electronic devices that incorporate semiconductors (such as computers and smart phones) drove upstream demand for SME in 2021.^[6] To meet the high demand for semiconductor chips, semiconductor manufacturers increased purchases of SME for both existing and new production lines.^[7] Moreover, top global semiconductor manufacturers—such as Taiwan’s Taiwan Semiconductor Manufacturing Company (TSMC) and South Korea’s Samsung—purchased SME to produce the most advanced chips with 2 to 3 nanometer transistors^[8] and raise production capacity for existing chips.^[9] Most SME exports in 2021 went to South Korea, China, and Taiwan, three of the world’s largest semiconductor producers. U.S. exports of SME to South Korea increased by $2.0 billion (40.4 percent) to $7.0 billion. Likewise, U.S. exports of semiconductor manufacturing equipment to China increased by $1.6 billion and U.S. exports to Taiwan increased by $1.1 billion.

U.S. exports of farm and garden equipment grew by $1.8 billion (23.8 percent) to $9.9 billion in 2021. U.S. exports for products in this digest fluctuated between $9.6 and $10.2 billion until 2020, due the COVID-19 pandemic downturn.^[10] While 2021 exports did not fully return to 2018 levels, the industry benefitted from the recovery to earlier pandemic-related disruptions. Canada was the top export destination and accounted for $3.0 billion (30.5 percent) of total U.S. farm and garden equipment exports, a $760 million increase from 2020.^[11] Exports to Mexico and Australia increased by $313 million and $201 million, respectively.^[12] Not surprisingly, the leading markets for U.S. exports of farm and garden machinery are among the world leaders in agricultural production.^[13]

U.S. exports of miscellaneous machinery increased in value by $1.3 billion (14.5 percent) to $10.3 billion in 2021. Nearly half of the export growth for products in this digest came from parts of machines for manufacturing or hot working glass or glassware, which grew by $723 million (97.7 percent).^[14] This was likely associated with the rising use of glass products by the global construction industry due to the increase in housing demand following the ongoing global economic recovery from the COVID-19 pandemic’s initial slowdown.^[15] Exports of miscellaneous machinery to Canada rose by $367 million (19.3 percent) while exports to Taiwan increased by $447 million (315.7 percent).

U.S. exports of centrifuges and filtering and purifying equipment grew in value by $1.1 billion (14.3 percent) to $8.8 billion in 2021. Products in this sector are used in wastewater management and other industries associated with environmental services. Increasing investments in the global construction industry, oil and drilling activities, and demand for pumps in the agricultural sector also contributed to the rising foreign demand for U.S. centrifuges and purifying equipment.^[16] The largest increases in U.S. exports were to Canada (up $274 million or 17.6 percent) and China (up $241 million or 32.7 percent).

U.S. exports of nonautomotive insulated electrical wire and related products increased in value by $840 million (17.7 percent) to $5.6 billion. These products are principally associated with the construction industry and the 2021 growth in exports likely benefitted from the global economic recovery following the initial COVID-19 pandemic slowdown and the rising demand for housing. Growth in global demand for electrification projects, electric vehicles (EVs), and EV charging stations also contributed to additional foreign demand for U.S. copper and insulated wiring.^[17] Additionally, there was an increase in the usage of insulated wiring in the global information technology (IT) and telecom industries as they upgraded to 5G.^[18] Mexico remained the top export destination with an increase in U.S. exports of $445 million (30.3 percent) to $1.9 billion. Canada was the second-leading export destination, with an increase in exports of $282 million (31.3 percent).

U.S. General Imports

U.S. imports of household appliances continued a multiyear upward trend, increasing by $7.9 billion (25.1 percent) to $39.3 billion. During the ongoing COVID-19 pandemic, U.S. demand for household appliances grew along with the rise in home renovations and new residential construction.^[19] In addition, an increase in disposable income from stimulus payments caused a surge in purchases of durable goods, including household appliances.^[20] China remained the top supplier to the United States with an increase in U.S. imports of $2.7 billion in 2021.^[21]

The value of U.S. imports of air-conditioning equipment and parts grew by $4.8 billion (24.3 percent) to $24.4 billion. Demand for heating, ventilation, and air conditioning (HVAC) equipment increased throughout 2021 due to growth in U.S. housing construction and renovations, a dynamic that carried over from 2020.^[22] In particular, with people spending more time at home, demand for home refurbishments rose, keeping demand for HVAC equipment high throughout 2021.^[23] Mexico remained the largest supplier of air-conditioning equipment and parts, with an increase in U.S. imports of $1.3 billion (21.0 percent) to $7.4 billion in 2021. China was the next-largest supplier with a growth in U.S. imports of $1.4 billion (24.7 percent) to $7.1 billion in 2021.

U.S. imports of farm and garden machinery rose by $3.3 billion (34.7 percent) to $12.7 billion in 2021. Although this continued the trend of increasing imports since 2016, the growth in 2021 imports was substantially larger than in earlier years. The demand for agricultural equipment is cyclical and is influenced by many factors such as farm income, weather conditions, and the demand for agricultural goods, both domestically and for export.^[24] Demand for new farm and garden equipment rose due to pandemic assistance, increased agricultural commodity prices, and larger foreign purchases of commodities.^[25] In fact, U.S. agriculture exports broke records in 2021, reaching $179.3 billion, which was 13.0 percent higher than the previous record in 2014.^[26] Despite low inventories and rising prices of farm equipment, farmers reportedly also purchased new farm equipment to reduce their tax bills.^[27]

U.S. imports of nonautomotive insulated electrical wire and related products grew by $2.5 billion (27.6 percent) to $11.7 billion in 2021. The growth in imports reflects the increased domestic consumption of homebuilding materials due to rising demand for new housing and renovations. In particular, a spike in domestic homebuilding activity drove high demand for insulated wire and cables.^[28] The growing construction of 5G networks for broadband access was also a driving factor for the expanding domestic market for insulated wire, with backing from the U.S. government in the form of a $100 billion investment plan.^[29] Mexico was the top supplier of nonautomotive insulated electrical wire, with U.S. imports from that country increasing by $998 million (36.7 percent) to $3.7 billion in 2021.

U.S. imports of portable electric handtools increased by $1.6 billion (31.5 percent) to $7.1 billion in 2021. Imports of portable electric handtools have been increasing annually since 2016 due to high demand from the residential and nonresidential construction sectors.^[30] In 2019, certain U.S. suppliers of handtools reportedly rerouted their supply chains through Vietnam due to growing tensions over trade between China and the United States.^[31] China was the largest U.S. supplier of portable electric handtools, with imports from that country rising $327 million (9.5 percent) in 2021.^[32] Vietnam was the next-largest supplier with a growth in U.S. imports of $724 million (103.9 percent) in 2021.^[33]