U.S. Agricultural Exports Decline, Imports Increase

September 28, 1999

A strong dollar and lower commodity prices have helped U.S. agricultural exports decline in value and imports increase. For the first 10 months of fiscal 1999, the value of agricultural exports declined 11% from the same period a year earlier and imports increased slightly.

The cumulative trade surplus declined 37% to $9.6 billion. July export values were the lowest for that month since 1994, but the July monthly trade surplus was the largest since February because monthly agricultural imports declined to the lowest value since August 1998, USDA says.

Bulk commodity exports of $15 billion through July are 15% less than a year earlier. Since bulk export volume in total is 12% more than in the same 10 months last year, the decline in export value is due to lower average prices for bulk commodities, the report says.

Plenty of supplies worldwide and weak demand caused U.S. soybean exports to decline 11% in volume and 29% in value so far in 1999. Shipments in fiscal 1999 so far are fewer to South America, Mexico, Europe and Asia, particularly to Brazil, Japan and China. July exports, however, increased slightly compared with June.

The value of wheat shipments in July increased 14% from June, but year-to-date wheat exports remained behind year-earlier levels. Wheat prices in July at Gulf ports were the lowest of the past decade, but export volume was 13% greater than 1998, the report says. Increased wheat shipments to Latin America so far this year offset declines to Asia and North Africa.

Corn now leads bulk commodity exports in value at $4.2 billion so far this fiscal year, a 15% increase over the same period a year earlier but still behind 1996 and 1997. Volume is 37% more than 1998 as demand from Latin America and Asia has increased. Low Gulf port prices, which were only two-fifths of the 1996 peak in July, coupled with the start of Asia's economic recovery, are pushing up demand in world markets.

Exports of high-value products, at $26.1 billion, are 9% less than last year. The largest declines are in poultry meats and hides and skins. Red meats, feeds and fodders, and nuts also are each more than $100 million behind export values from 1998.

Although July imports are the smallest so far this year, the cumulative value of $31.6 billion is slightly greater that 1998. The largest gains in year-to-date imports are in fruits, vegetables, red meats, dairy products and wine and malt beverages. Imports should exceed last year's value, because U.S. consumers continue to take advantage of the dollar's high purchasing power, the report says.