U.S. AGRICULTURAL TRADE UPDATE September 26, 2000 September 2000, ERS-FAU-45 Approved by the World Agricultural Outlook Board --------------------------------------------------------------------------- U.S. AGRICULTURAL TRADE UPDATE is published monthly by the Economic Research Service, U.S. Department of Agriculture, Washington, DC 20036-5831. Subscriptions to the printed version of this report are available from the ERS-NASS order desk. Call, toll-free, 1-800-999-6779 and ask for stock # SUB-FAT-4030, $52/year. ERS-NASS accepts MasterCard and Visa. --------------------------------------------------------------------------- Summary-After running below last year for the first 8 months of fiscal 2000, for the second consecutive month, the cumulative U.S. agricultural export surplus is slightly above last year, at $9.7 billion. Although July 2000 exports dropped $223.8 million from June 2000, July imports fell more, $307.8 million, raising the gap between exports and imports fractionally. Through July, both U.S. exports and imports are rising. Exports equal $42.6 billion, a 3.5-percent gain over 1999. And imports are up 4.3 percent, to $33 billion. Exports-Cumulative bulk product exports-wheat, rice, coarse grains, soybeans, cotton, and tobacco--are still just under last year at $15 billion, down 1 percent. Both value and volume of cotton and soybean exports are above the previous year. But, wheat and corn continue to lag behind last year's export pace. At $2.7 billion, October-July wheat exports are $295 million less than 1999, while volume is 1.6 million tons behind 1999. World import demand continues firm as consumption exceeds production. However, world stocks remain relatively high, particularly among export competitors, keeping prices low. U.S. wheat exports in July slipped 159,000 tons from June. Although July's U.S. corn exports rose 234,000 tons from June, the 39.5 million tons of corn exported in the year-to-date remains 7 percent below last year. Cumulative corn export value is down 9.5 percent to $3.8 billion. Despite rising global demand, 1999/2000 production gains in both importing countries and competing exporters are increasing export competition this year. And large global stocks continue holding prices down. Fiscal 2000 soybean exports remain strong, having gained 10 percent in value and 18 percent in quantity already in the year-to-date. Soybean export value equals $4.5 billion, and volume is up to 23 million tons. China's decision to import substantially more soybeans in 2000 to supply domestic mills has been responsible for most of the growth. However, overall global import demand also is rising somewhat. The other bright spot among bulk commodities is cotton. At $1.6 billion and 1.3 million tons exported already this year, U.S. cotton exports are up 33 percent in value and 64 percent in volume over last year. Global import demand is up, as world consumption exceeds production. Much of the growth in global consumption demand is in China where production has fallen more than consumption is rising. At $28 billion, exports of high-value products (HVP) are 5.8 percent greater than in the first 10 months of last year. Meat and poultry and hides and skins lead these gains, increasing by $1.1 billion and $278 million in the year-to-date. Poultry exports to Russia have recovered from the 1998/1999 downturn. Rising prices for beef and pork also support a modest gain in meat value. Improving global economic growth, especially in major Asian markets, is boosting hide and skin exports. Exports of dairy products, live animals, animal feeds, and vegetables also are up. Imports-The $1.4 billion gain in year-to-date U.S. agricultural imports largely is occurring in meats and poultry and live animals. Malt beverages and wine also continue to show strength. Meat and poultry imports are up $529 million, or 20.4 percent, so far this year, while live animal imports have risen $298 million, or 24.4 percent. These imports come primarily from Canada, Australia, and New Zealand. Malt beverages are up $170 million and wine $109 million, gains of 11 and 6 percent. Mexico, the Netherlands, Germany, and Canada lead suppliers of U.S. malt beverage imports. France, Italy, Australia, and Chile are the leading sources of U.S. wine. [Carol Whitton, 202-694-5287, cwhitton@ers.usda.gov] Economic growth in Asia is helping boost 2000 U.S. agricultural exports-Since the 1998 recessions in Japan, Southeast Asia, and South Korea, Asian economic growth has been gradually rebounding. Economic growth in Asia is projected at 7 percent for 2000, compared with just 0.4 percent in 1998. This economic recovery is leading to larger imports in many of the affected countries. The United States has taken a share of this growth. U.S. agricultural exports to Asia in the first 10-months of fiscal 2000 are up 7 percent, or $1.2 billion. Much of the gain is in Japan and China, where U.S. export gains already exceed $400 million each for the year. Exports to the Philippines and Indonesia also show strong percentage gains this year, and actual gains exceed $100 million each (Table 5). Next update: October 25, 2000 END_OF_FILE