U.S. AGRICULTURAL TRADE UPDATE July 24, 2001 July 2001, ERS-FAU-55 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 USDA order desk. Call, toll-free, 1-800-999-6779 and ask for stock # SUB-FAT-4030, $62/year. ERS accepts MasterCard and Visa. --------------------------------------------------------------------------- Summary--The $10.2 billion October-May surplus in U.S. agricultural trade is now $2.1 billion ahead of the first 8 months of fiscal 2000. The $1.9 billion year-to-date export gain from last year is almost entirely non-bulk products, mainly livestock, feeds and fodders, and horticulture. Gains from bulk commodities as a group are only $58 million thus far. In each month this year, exports have exceeded corresponding values in 2000. Meanwhile, cumulative imports are largely unchanged from last year. Tropical imports to date, principally coffee, are more than $1 billion off of last years pace due to the worst prices since the early 1990s. Exports in May 2001 dropped $142 million from April due mostly to $137 million lower corn sales. Exports--Bulk commodity exports to date are fractionally above last years value as bigger cumulative soybean sales offset losses from corn and rice. The cumulative loss of 114 million tons in bulk shipments is attributed to declines in corn and rice. Wheat and soybean export volume dropped sharply in May 2001 from April. Soybean exports of $4.3 billion thus far in fiscal 2001 are $341 million ahead of 2000. In volume, 2.2 million tons more have been shipped. China imported 5.2 million tons from October to May, almost double last years purchases, and more than offsetting lower U.S. sales to the European Union (EU). Increased sales to Mexico largely offset smaller sales to South Korea and Taiwan. Soybean prices remain low as supplies from Brazil and Argentina are bountiful and another large drop in U.S. shipments occurred from April to May due to the strong competition. Although wheat shipments dipped by 85,500 tons in the year-to-date, export value is up $75 million from 2000. This reflects higher wheat prices due to reduced world production and stocks. Thus far $2.2 billion of wheat has been exported, or 17.1 million tons. The largest U.S. customers to date are Indonesia, Mexico, and South America. Corn exports worth $2.8 billion to date are $246 million behind last years value, as volume shipped declined 2.2 million tons. Despite significantly increased corn shipments to Canada and Mexico, demand from most other markets is down. Corn prices remain depressed despite reduced world production because of the reduced demand. Competition from Argentina, China, and South Africa and the strong U.S. dollar also are partly responsible. October-May cotton exports of $1.3 billion are about the same as in 2000, although volume is down 109,000 tons. Prices have recently declined, as world production is expected higher and import demand has ebbed. Among the few markets with increased cotton imports from the United States are South Korea, Mexico, Canada, and Pakistan. The slowdown in global industrial production is partly responsible for the reduced shipments, as well as increased competition from Australia. U.S. exports of high-value products, $24 billion to date and $1.8 billion more than last year, are driving the U.S. farm trade surplus up. The $489 million gain from horticultural exports is almost twice that of livestock products. Nevertheless, hides and skins, which are up $354 million, exhibited the largest export year-to-date jump of a commodity group. Exports of feeds and fodders also are a big contributor, with gains of $253 million. Imports--The overall decline in U.S. agricultural import value in the year-to-date is attributed to low prices of tropical products-- coffee, cocoa, and rubber. Reduced U.S. demand for vegetable oils is another reason. However, imports of competitive products are up almost $1 billion, primarily from animal products (up $514 million) and horticultural products (up $387 million), especially vegetables and wine and malt beverages. [Alberto Jerardo, 202-694-5323; ajerardo@ers.usda.gov] In fiscal 2000, Texas rebounded to third-ranked State exporter. Sharp gains in exports of cotton and live animals and meat in 2000 helped pull Texas up to third-ranked State agricultural exporter after its poor year in 1999. Texas exports rose 20 percent to $3.3 billion in 2000. California continued to lead State agricultural exports, with $7.6 billion. The State accounted for half of all U.S. vegetable exports, in which it showed a large gain, and also led in exports of fruits and tree nuts. Iowa, the second-ranked State exporter, led in exports of feed grains and soybeans. Texas led in cotton and cottonseed, ranked second in exports of feeds and fodders, and third in live animals and meats, hides and skins, and animal fats. Next Update: August 27, 2001 In Fiscal 2000, Texas Rebounded to Third Ranked State Exporter; California Remained Number One Fiscal 2000 U.S. agricultural exports rose $1.8 billion, as global demand began to recover from the financial crises of 1997-1999 and even though prices remained relatively low for major export commodities. Exports of soybeans and products rose more than $100 million to become the highest ranking export product at $6.7 billion. Exports of live animals and meat showed the greatest gains, rising $1.1 billion to $6.5 billion in fiscal 2000. Cotton also showed sharp gains of $500 million. Exports of feed grains and products slipped nearly $400 million, while exports of wheat declined about $300 million. Except for feed grains and wheat, the other top export commodities--soybeans and products, live animals and meat, vegetables and preparations, fruits and preparations, poultry and products, feeds and fodders, cotton and linters, and hides and skins--all rose in value year-to-year. Initially strong recovery in economies in Asia and Russia, which had been affected by the earlier crises, was primarily responsible for gains in exports in 2000. Estimated exports from 8 of the top 10 States rose. Texas showed the strongest percentage growth after a poor year in 1999, rising 20 percent to exports of $3.3 billion in 2000. California continued to lead State agricultural exports, with $7.6 billion. Iowa remained second at $3.4 billion, just ahead of Texas at number three. At $1.4 billion, Arkansas regained as 10th ranked State exporter, surpassing Wisconsin, which again slipped to 11th ranked export State, as in 1998. In between, the other top 10 agricultural exporting States remained unchanged from 1999--Nebraska, Kansas, Illinois, Minnesota, Washington, and Indiana. These 10 States rose to account for 59 percent of total agricultural export value in 2000, up from 58 percent in 1999. And again, 16 States exported more than $1 billion of agricultural products each. Rising to third ranked State agricultural exporter in 2000, Texas showed the largest percentage gain in 2000 exports because of the sharp rebound in overall exports of both cotton and live animals and meat. Of the total $534-million gain in Texas exports, live animals and meat accounted for $138 million and cotton another $180 million. Texas remained the leading State in exports of both cotton and cottonseed, ranked second in exports of feeds and fodders and peanuts, and third in exports of live animals and meat, as well as the related products hides and skins and animal fats. Californias estimated agricultural exports increased $638 million, but at 9 percent is only half of Texas percentage gain over 1999. Vegetables showed the largest gain in exports in California, rising more than $300 million to account for 29 percent of Californias total agricultural exports, up from 27 percent in 1999. And California again accounted for half of all U.S. vegetable exports. The States gains in fruit and cotton exports were not far behind, increasing more than $160 million each. Among Californias other important export commodities, tree nuts and rice both slipped below 1999. California is the State leader in exports of vegetables, fruits, tree nuts, and seeds. The second ranked U.S. agricultural exporter, Iowa, showed only a 3- percent or $100-million gain in agricultural exports in 2000. Iowa again led in exports of feed grains and soybeans, accounting for 17 and 18 percent shares of total U.S. exports of these products. Iowas exports of both products were virtually unchanged from 1999. The State also continued to be an important exporter of live animals and meat, feeds and fodders, and seeds. Nebraska resumed fourth rank among U.S. agricultural export States, with $3.1 billion in agricultural exports, 7 percent more than in 1999. Nebraska led other States in exports of live animals and meat, feeds and fodders, and animal fats and ranked second in exports of hides and skins. Its exports rose significantly in 2000 because of the recovery in global demand for high-valued animal products. The States exports of live animals and meat increased 20 percent and accounted for 16 percent of all State exports of this product. Kansas, the leading U.S. wheat export State, ranked fifth in total State agricultural exports with $3.1 billion exported, even though its wheat exports declined nearly $100 million in value to just 90 percent of the previous years wheat export value. Kansas still accounts for 20 percent of total U.S. wheat exports. In addition, in 2000 Kansas regained first rank among State exporters of hides and skins, surpassing Nebraska and Texas. The sixth largest State exporter, Illinois, exported nearly $3 billion worth of agricultural goods in 2000, about the same as its exports in 1999. Illinois ranked second after Iowa in exports of feed grains and products and soybeans and products. It accounted for 15 percent of total U.S. feed grain exports and 17 percent of total soybean exports in 2000. Of the remaining 4 of the top 10 export States in 2000, Minnesota continued to be an important exporter of dairy products and soybeans and products. Washington remained the second largest vegetable exporter and the third largest exporter of fruits. Indiana was a relatively large exporter of soybeans and products and Arkansas again was the largest rice exporter. Although not among the top 10 in 2000, Georgia remained the largest poultry and peanut exporting State. North Carolina is the leader in exports of tobacco; North Dakota again led in exports of sunflower seeds and oil. And, Wisconsin led in dairy product exports. Methodology The Economic Research Service (ERS) estimates State exports based on a States share of production of the exported commodity. The estimated export value for each State should not be interpreted as an actual measurement of a States export. ERS uses the Bureau of Census merchandise export data, which are reported on a free- alongside-ship (f.a.s.) basis. The Census export data are reported by customs district, which can vary in size from a single port to several States. Frequently, no State is reported in this data set, and when States are reported it is the State from which the commodity began its export journey, not necessarily the State in which the commodity was produced. An agricultural commodity is likely to pass through several States before being exported, and the State of origin often is lost as commodities move from farmgate to port. Further, each commodity shipment may be mixed with other lots of the same commodity in the shipping or storage process or at the port. Estimates of U.S. State exports made by other organizations are based primarily on this data reported at the port. Compared with ERS estimates, those estimates tend to inflate the relative exports of port States and undercount those of inland States, where many agricultural commodities originate. ERS export estimates are based on the National Agricultural Statistics Services crop and livestock production and slaughter estimates. In some cases, supplemental data, such as the Census of Agriculture, 1997 and the Department of Commerces estimates for Exports from Manufacturing Establishments: 1990 and 1991 are used to refine export estimates. Data for earlier years are revised to reflect production data revisions. ERS detailed commodity breakdown by State is available on our web site: http://www.ers.usda.gov/data/fatus. (Carol Whitton, 202-694-5287; cwhitton@ers.usda.gov) END_OF_FILE