Taiwan December export orders hit record high, warns on supply chains

[January 20, 2022]   TAIPEI (Reuters) -Taiwan's export orders grew faster than expected in December to a record high due to sustained technology demand, but the government warned of supply chain uncertainty that could affect the outlook.

Taiwan's export orders, a bellwether of global technology demand, rose 12.1% from a year earlier to $67.9 billion last month, the highest monthly figure on record, data from the Ministry of Economic Affairs showed on Thursday.

That marked the 22nd straight month of expansion, with the pace much faster than the median forecast for a rise of 8% in a Reuters poll.

The ministry said supply chain problems continued to ease and there was solid consumer demand for technologies such as notebook computers and 5G.

Orders for telecommunications and electronic products both hit record highs in December, normally the start of the low season with Christmas out the way, with the ministry reporting "brisk" demand.

The ministry said export orders for all of 2021 rose 26.3% versus 2020, reaching $674.13 billion, also a record high. Growth has been supported by the work-from-home-trend during the pandemic as well as a global semiconductor shortage.

However, while the ministry said demand would continue to be supported by tech demand, it warned supply chain issues were still present along with COVID-19 worries, and noted the first quarter was generally the low season for technology goods.

Kevin Wang, an economist at Taishin Securities Investment, said resurgent COVID-19 in the United States and China could affect the outlook, and coming off a high base last year export order growth in the first quarter was likely to stall.

Taiwanese companies such as Taiwan Semiconductor Manufacturing Co Ltd (TSMC) are major suppliers to Apple Inc, Qualcomm Inc and other global tech firms.

In November, export orders rose 13.4% from a year earlier to $65.5 billion, far better than economist forecasts.

The ministry said it expects an increase in export orders in January to be in a range of between +11% and +13.8% from a year earlier.

Orders from the United States rose 16.9% in December from a year earlier, a much faster rate of expansion compared with the 10.8% logged in November, while orders from China increased 4.5%, versus a gain of 25.3% the previous month.

Orders from Europe rose 8.2%, while those from Japan dropped 5.8%.

(Reporting by Roger Tung and Yimou Lee; Additional reporting by Emily Chan; Writing by Ben Blanchard. editing by Jane Merriman and Jason Neely)

[© 2022 Thomson Reuters. All rights reserved.]
This material may not be published, broadcast, rewritten or redistributed.  Thompson Reuters is solely responsible for this content.