Earnings from merchandise exports surpassed US dollars 1 billion for the second time during the year to US dollars 1,024 million in June 2018, mainly driven by industrial exports. Under industrial exports, earnings from textiles and garment exports increased significantly due to the higher demand from the EU and the USA while exports to nontraditional markets also increased.
Export earnings from petroleum products increased significantly in June 2018 due to the combined effect of higher export prices and volumes of bunker and aviation fuel. Export earnings from rubber products increased mainly due to higher earnings from tyre exports.
Earnings from exports of machinery and mechanical appliances also increased notably during the month owing to the increase in earnings from electrical machinery and equipment and electronic equipment exports.
Meanwhile, export of base metals and articles increased due to higher exports of iron and steel articles and aluminium articles. However, earnings from transport equipment exports declined significantly mainly due to the effect of higher earnings recorded in June 2017 following the export of two ships.
In addition, food, beverages and tobacco and leather, travel goods and footwear exports also declined notably in June 2018 in comparison to June 2017. Meanwhile, earnings from agricultural exports declined in June 2018 due to the poor performance in almost all categories except seafood, unmanufactured tobacco and rubber exports. Export earnings from tea declined as both prices and volumes exported reduced in June 2018. In addition, export earnings from spices declined marginally in June 2018 as the growth in cinnamon, and nutmeg and mace was outperformed by the decline in pepper, cloves and other spices.
However, benefiting from the positive impact of the removal of the ban on fisheries exports to the EU and the restoration of GSP+ facility, earnings from seafood exports increased significantly during the month due to higher prices and volumes of seafood exported. Leading markets for merchandise exports of Sri Lanka in June 2018 were the USA, the UK, India, Italy and Germany, which accounted for about 48 per cent of total exports.