Ag Exports Decline by Almost $500 Million

March 28, 2000

Agricultural exports for October-January declined by almost $500 million to $17.8 billion, USDA reports. Combined with more imports, the cumulative trade surplus for the year so far was reduced to less than $5 billion from $6 billion a year earlier.

Bulk commodity exports were mostly responsible for the total farm export decline so far in fiscal 2000. The $716 million decline in bulk shipments was in cotton, soybeans and wheat. Still, bulk product exports in January increased $4 million from December due to large rice shipments.

The current export value of $1.1 billion shows an 11% decline, while volume shipments have declined. Wheat prices, at record lows over the past decade, exacerbated the decline as other wheat exporters flooded the world market, says the report.

Cotton exports were down sharply in fiscal 2000 by $233 million due to smaller volume shipments. Export prices are at record lows for the past decade. Volume declined the most to Mexico followed by East Asia. Larger exports from Uzbekistan, the African Franc Zone and Australia are behind the world's large cotton supply, the report notes.

Soybean exports declined by close to $200 million in cumulative value despite higher volume shipments. Recent export prices have increased a bit from last summer's lows, but they still are depressed. Demand from Latin America and the European Union for U.S. soybeans has declined as South America sales continue at high levels.

Volume shipments of corn have increased in fiscal 2000, but export value declined, though by only 4%. And even though export prices have recovered somewhat recently, larger exports by China and Argentina are displacing U.S. exports. Significantly lower U.S. sales to Mexico, South Korea and Japan recently undermined export gains for corn from fiscal 1999.

High-value exports are greater than last year by $233 million, offsetting a third of the cumulative decline in bulk commodity exports. Red meats increased by $373 million; poultry, hides, vegetables and sugar products increased by more than $200 million. But vegetable oils, fruits and nuts are behind last year's pact. Russia, East Asia and Southeast Asia are the leading markets for U.S. animal products so far this fiscal year.

Agricultural imports increased by more than $500 million in October-January. Strong U.S. import demand for animals, red meats, fruits, nuts, wine and malt beverages are behind the surge.

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