Ebola Affects Imports, Exports

The Central Bank of Liberia(CBL) has disclosed that Liberia’s Merchandise Export decline while Import payment rose.

According to the CBL quarterly Finance and Economic Bulletin for the month of July to September, there is a decline in iron ore and rubber export earnings and the total merchandise export earnings plummeted by 13.6 percent to US$145.8 million at end-September, 2014, from US$168.8 million at end-June.

The Bulletin also disclosed that iron ore export receipts fell by 10.0 percent to US$100.3 million at the end of the period under review, from US$111.5 million at end-June.

Similarly, the report said rubber export receipts declined by 10.9 percent to US$22.0 million at the end of the review quarter, from US$24.7 million at the end of the preceding quarter.

The CBL said the declines in rubber and iron ore export receipts were driven by both domestic and external factors citing the domestic front as the ongoing Ebola Virus Disease crisis which greatly affected iron ore production and export during the quarter with export volume declining by 31.8 percent to 1,109,246.0 metric tons at the end of the quarter, from 1,626,157 metric tons at end-June, 2014.

On the external front, the CBL said increasing iron ore and rubber supply on the global market in the face of weakening consumption demand across major markets mainly China and the Eurozone continues to drive the downward spiral in iron ore and rubber prices.

The CBL bulletin also noted that average quarterly iron ore price fell by 12.0 percent to US$90.3 per metric ton for the quarter ended-September, 2014, from US$102.6 for the preceding quarter.

Compared with the level at end-September, 2013, the CBL said average quarterly iron ore price fell by 32.0 percent at end of the quarter under review.

On the rubber sector the bank said average quarterly rubber price declined by 13.0 percent to US$1,837.7 per metric ton at the end of the quarter from US$2,118.3 recorded at end-June while year-on-year, rubber price fell by 29.0 percent.

The CBL said despite the fall in iron ore and rubber export receipts during the quarter, the iron ore-rubber led enclave sector continued its dominance in Liberia’s export base, with the two primary export commodities accounting for 85.5 percent of total export receipts at the end of the quarter, from 80.7 percent at end of June 2014

The CBL noted that year-on-year, total export receipts rose by 29.8 percent at end-September, 2014 compared with the corresponding quarter in 2013, driven largely by increase in iron ore export earnings.

“Despite the persistent decline in iron ore price and constraints posed by the ongoing EVD crisis, iron ore export earnings rose by 61.5 percent year-on-year mainly due to increase in export volume from drawdown on inventory in consideration of further decline in prices and the fear of a prolonged Ebola Virus Disease(EVD) crisis.

Largely on account of the Ebola epidemic that peaked during the quarter, minerals including diamond and gold as well as round logs export earnings underperformed the levels recorded in the preceding quarter, with total gold and diamond export earnings declining by 41.8 percent to US$8.5 million, from US$14.6 million at end-June, 2014.

The CBL also disclosed that round logs export receipts fell by 17.1 percent to US$6.3 million at end-September, 2014, from US$7.6 million at end-June, largely explained by the EVD crisis and the rainy season.

“However, year-on-year, round logs export receipts surged by 31.3 percent, mainly occasioned by drawdown on inventories as a result of the fear of a prolonged EVD crisis and the ongoing decline in the international price of the commodity,” the CBL report said.

Touching on merchandise imports, the report said import payments (f.o.b) rose by 21.4 percent to US$260.5 million at end-September, 2014, from US$214.5 million at end-June, largely driven by increases in payments in key categories like petroleum products, chemicals and related products, machinery and transport equipment as well as manufactured goods classified chiefly by materials.

Despite the 11.5 percent decline in the price of petroleum products on the world market at end-September compared with end-June, 2014, petroleum imports rose by 17.3 percent to US$66.5 million at the end of the quarter, from US$56.7 million at end-June, largely driven by increase in import volume in response to the ongoing fight against the EVD epidemic.

Petroleum import volume rose by 12.3 percent to 71,164.4 metric tons at the end of the quarter, from 63,385.9 metric tons at end-June, the CBL said.