In the past two years, U.S. trade with Russia has experienced a significant decline, reaching levels not seen since the aftermath of the Soviet Union's collapse three decades ago. According to recent data from the U.S. Census Bureau, U.S. exports to Russia have plummeted by 91%, while imports have dropped by 85% when comparing the first 11 months of 2023 to the same period in 2021. This results in an overall decline of 86% in total trade.
To put this into perspective, the total trade in November of last year amounted to $4.81 billion, which is only slightly higher than the total trade recorded in 1993 when Russia's trade was no longer reported as part of the former Soviet Union. The following year, in 1994, the total trade exceeded $5.82 billion. When the annual data for 2023 is released in February, it is unlikely that Russian trade will surpass the 1994 total.
This steep decline in U.S. trade with Russia, which began during the Trump administration and has continued under President Biden, can be attributed to the efforts of the United States and a coalition of mainly European nations to counter Russia's invasion of Ukraine. However, these efforts are currently in limbo due to hesitancy among some members of Congress to continue supporting the initiative. Additionally, there is interest in combining aid packages for Ukraine and Israel's conflict with Hamas, as well as addressing the issue of illegal immigration along the U.S.-Mexico border.
It is worth noting the historical context of Russia's trade relationship with the United States. The Soviet Union, formed in 1922, included Ukraine, Belarus, Georgia, Azerbaijan, Armenia, and several other nations. It also exerted influence over the Baltic states, Moldova, Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan, and Uzbekistan. Many countries that were once part of the Soviet bloc are now members of NATO, which was established after World War II to counter any potential aggression from Soviet leader Joseph Stalin towards Western Europe. Presently, NATO includes nations such as Hungary, Poland, Bulgaria, the Czech Republic, and several others that were formerly within the Soviet sphere.
As a reflection of the decline in U.S. trade with Russia, it is intriguing to observe that Russia currently conducts less trade with the United States than countries like Poland, Hungary, the Czech Republic, Slovakia, and Romania, as indicated by the Census data. Over the past decade, Slovakia has been the fastest-growing top 50 import partner of the United States, with Hungary and Poland also ranking within the top 10. In terms of exports, Poland has emerged as the fastest-growing, while the Czech Republic holds a place within the top 10.
The decline in U.S. exports to Russia over the last two years, accompanied by a similar drop in imports, has affected a diverse range of products. Among the top 50 exports to Russia in the first 11 months of 2023, 20% of them had fallen to zero by November. This includes items such as tractors, diesel engines, tires, satellites and related equipment, commercial vehicles, and even jewelry and parts. Likewise, 30% of the most valuable inbound shipments from Russia during the same period had also decreased to zero. Refined petroleum products, pig iron, shrimp, lead, non-engine aircraft parts, fish fillets, steel ingots, and briquette coal are just a few examples.
The decline in trade between the United States and Russia has also impacted business at airports and seaports. Out of the top 25 U.S. airports and seaports engaged in trade with Russia, 24 of them have experienced a decrease in trade since 2021. More specifically, trade has declined by over 90% at 12 of these locations and by over 97% at seven of them. The only exception is the Port of Wilmington, N.C., which has witnessed an 18.22% increase in trade. The top five U.S. ports for Russian trade in 2021, namely the Port of New Orleans, JFK International Airport, the Port of Houston, the Port of Newark, and PhilaPort, all suffered a loss of over $1 billion in trade.
In conclusion, U.S. trade with Russia has undergone a significant decline in the past two years, reaching levels unseen in decades. Efforts to counter Russia's invasion of Ukraine have contributed to this decline, but political factors and other geopolitical concerns have affected the continuation of these efforts. The decline in trade has impacted a wide range of products and has had significant effects on airports and seaports involved in trade with Russia. Nonetheless, the future of U.S. trade with Russia remains uncertain, and it will be interesting to see how this relationship evolves in the coming years.
