U.S. agricultural exports are forecast to climb to $140 billion in fiscal 2018, according to a Nov. 30 report from the Economic Research Service of the U.S. Department of Agriculture. The projection is up $1 billion from the USDA’s forecast in August but down from $140.5 billion in fiscal 2017.
The USDA said the increase from the August forecast primarily reflects expected gains in corn and distiller’s dried grains with solubles (DDGS).
“Today’s quarterly trade forecast reflects the fact that U.S. agricultural exports are continuing strong in the 2018 fiscal year,” said U.S. Secretary of Agriculture Sonny Perdue. “We just closed out FY 2017 with the third-highest export total on record and I’m delighted to see that FY 2018 is shaping up to come close. With a forecast of $140 billion, we’re looking at the fourth-best year in history. And there’s additional positive news in the fact that agriculture’s trade surplus is expected to grow eight percent, from $21.3 billion last year to $23 billion in 2018.
“Much of this expected success can be attributed to robust sales to our East Asian and North American trading partners. China is again shaping up to be our top market, led by continued strong soybean sales, while Canada and Mexico remain our second- and third-largest markets, respectively. We’re expecting exports to grow in the coming year to all of our top three markets.
“The bottom line is that exports continue to be a major driver of the rural economy, generating 20% of U.S. farm income and supporting more than a million U.S. jobs. The USDA team continues to work around the clock and around the globe to boost export prospects for American farmers and ranchers not only by expanding existing markets and improving existing trade agreements, but also by aggressively pursuing new markets and new opportunities.”
U.S. grain and feed exports for the 2018 fiscal year are forecast at $29.4 billion, up $1 billion from the August forecast, due mainly to coarse grains and feeds and fodders, the USDA said. Corn exports are forecast at $8.5 billion, up $500 million on both higher volumes and unit values.
“These are supported by strong early-season sales and shipments, primarily to Mexico,” the USDA said. “With sharply lower domestic sorghum supplies, Mexico is expected to boost corn imports to satisfy feed demand.”
U.S. wheat exports, meanwhile, are forecast at $6.3 billion, down $100 million as lower unit values more than offset higher volume.
“Unit values are lower on pressure from abundant global supplies, especially in Russia,” the USDA said. “Volume is up on large sales to Iraq and the expectation that U.S. wheat will be more competitive later in the year.”
U.S. rice exports are forecast at $1.9 billion in fiscal 2018, up $200 million as higher unit values more than offset lower volumes.
“Unit values are higher based on a smaller crop and tight stocks, while volumes are down on smaller shipments to Latin America and the Middle East,” the USDA noted.
The USDA said oilseeds and products are forecast to increase slightly in fiscal 2018 to $33.1 billion as higher soybeans more than offset declines in soybean meal and oil.
“Record U.S. soybean production is driving record exports,” the agency noted. “Although unit values are lower on larger global supplies, these are expected to spur additional demand for U.S. soybeans, pushing total soybean export value up $200 million to $24.1 billion. Competition from South America and demand in China remain key drivers in the forecast.”
Regionally, Asia remains the top export market for U.S. agricultural products. The USDA said ag exports for the region are expected to grow to $61.9 billion in fiscal 2018, up from the August forecast of $61.5 billion but down from $63.4 billion in fiscal 2017. The increase from August to November reflects the reopening of the DDGS market in Vietnam to U.S. supplies and higher expected sales of cotton.
In the Western Hemisphere, agricultural exports for fiscal 2018 are forecast at $54.2 billion, up from $53.8 billion in August and up from $52.9 billion in fiscal 2017. The increase reflected a bump in the projection for Mexico to $19.2 billion from $18.8 billion.
The forecast for U.S. agricultural exports headed to Europe, Africa and the Middle East remained unchanged at $12.8 billion, $3.6 billion and $5.8 billion, respectively.