October export orders expected to grow for 3rd consecutive month

Taiwan is likely to report a year-on-year increase in export orders for October due to the peak season in the global electronics industry, the Ministry of Economic Affairs (MOEA) said Saturday.

The MOEA said that a year-end buying spree in the upcoming Christmas season has prompted international high-tech brands to build up their inventories, which are expected to help Taiwanese suppliers increase their sales in October.

According to a ministry estimate, Taiwan's export orders for October could range between US$43.5 billion and US$44.5 billion, compared with US$42.96 billion recorded in September.

The estimated October export orders represent an increase from US$42.55 billion registered over the same period of last year, making October the third consecutive month in which the country's export orders made a year-on-year increase.

The MOEA is scheduled to release the October export order data on Nov. 21.

In September, Taiwan's export orders rose 3.9 percent from a year earlier, the second consecutive monthly increase, partly in reflection of the launch of the 5.5-inch iPhone 7 Plus and the 4.7-inch iPhone 7 by Apple Inc. in that month.

On the back of the presence of the new iPhones and other electronic devices, Taiwan's export orders in information/communications devices and electronic products for September rose 8 percent and 10.1 percent, respectively, from a year earlier to US$14.63 billion and US$11.6 billion.

Many Taiwanese electronics manufacturers, such as Hon Hai Precision Industry Co. (??), an assembler of iPhones and iPads, and Largan Precision Co. (???), a smartphone camera lens maker for iPhones, are among the suppliers to Apple. These Apple suppliers account for about 40 percent of market capitalization in the local equity market.

The MOEA said that Taiwan's exporters have continued to benefit from the effect of the launch of the new iPhones in October and even into the fourth quarter.

In addition to the new iPhones, other international brands have launched new devices, including notebook computers and wearable gadgets, to take advantage of the strong year-end buying interest, which has paved the way for an increase in export orders, the MOEA said.

The MOEA said that with international crude oil prices and steel prices stabilizing, export orders received by old-economy firms could also trend higher to give another boost to the entire export orders in the country.

Source: Focus Taiwan News Channel