Manufactured exports from Alaska: expanding success with international sales.

• Author: Trainer, Anneliese
• Position: SPECIAL SECTION: International Trade

All developed economies include a value-added sector; Alaska's small but nationally competitive manufacturing is strong but narrow, with room to grow. Alaska's notoriously high energy costs and remote location present unique operational challenges for any business owner, let alone those aspiring to export products overseas. However, data show that the manufacturing sector is thriving in unique ways. International exports are certainly an important piece of that puzzle, and an examination of those trends offers interesting insights into both established and growing industries operating in Alaska.

It is true that compared to other states, Alaska's manufacturing sector is relatively small. According to the US Census' State Trade Data, Alaska exported $276.1 million worth of manufactured goods for the year as of October 2016. Included in this figure is October's total export value of $27.3 million. In 2014, there were approximately 570 manufacturing companies operating within the state. A 2014 planning study for the Manufacturing Extension Partnership reports that 63 percent of 67 surveyed manufacturers explained that they sold products outside of the Alaska market, while 39 percent had tried to access international markets.

In 2015, manufactured products made up 7.64 percent of all Alaska exports, with $353 million worth of products shipped out of state. "Food, beverage, tobacco, and clothing" (manufacturing, part 1) is the smallest industry subset, with a total of approximately $38 million worth of goods (0.83 percent of total exports) exported outside of the state. "Primary metal, machinery, metal works, computer and electronics, appliance, vehicle and furniture," (manufacturing, part 2) is notably larger, with a total of $138 million in exports (3 percent). The largest manufacturing sector by export value is made up of "wood, paper, petroleum and coal, chemical, pharmaceutical, paint, toilet, non-metallic minerals, and cement" (manufacturing, part 3) at 3.81 percent of total exports, with a dollar value of $176 million.

Manufacturing Parts 1, 2, and 3

The vast majority of "manufacturing, part 1" exports are "food manufactures" due to Alaska's large fish processing sector. In 2015, $31 million worth of manufactured food products were shipped outside of the state. It is perhaps surprising that this number is not higher. This is because the North American Industry Classification System is very specific about what constitutes a manufactured seafood product.

Producers of minimally processed seafood, such as fish that are merely headed and gutted...