Canada will return to the rank of No. 1 importer of U.S. farm goods and China will drop to No. 2 as U.S. soybean exports wither by 19 percent due to the strong dollar and large crops in South America, the USDA said in its first forecast of fiscal 2016 exports. “Soybeans account for 60 percent of exports to China and soybean values (both prices and volume) are expected to fall in fiscal 2016,” said the quarterly Outlook for U.S. Agricultural Trade. China dislodged Canada, the longtime leader, as top importer in fiscal 2011 as its economy boomed.
While sales to China are forecast to fall by 9 percent, to $20.5 billion, Canada was forecast to import $21.8 billion of U.S. farm products in fiscal 2016, the same total as this year and in 2014, “as expanded horticultural exports offset lower oilseed values,” said the USDA. As usual, Mexico will be No. 3, at $18.5 million, with Japan and the European Union tied for fourth with imports of $12 billion. The top five markets account for 60 percent of U.S. farm exports.
Exports are a major outlet for U.S. production and an important source of revenue for farmers and ranchers. Over the past three years, exports were equal to 36 cents of each $1 in farm cash receipts.
Like soybeans, Chinese demand for U.S. cotton is expected to fall. Exports of sorghum and distillers dried grains (DDGs), an ethanol co-product, “are expected to continue to remain strong in fiscal 2016,” said the USDA. China is the world’s largest importer of rice, cotton and soybeans and a major importer of sorghum and DDGs.
Smaller exports, coupled with bumper crops, are a factor in large U.S. soybean supplies and low prices, expected to persist for years. The U.S. soybean stockpile is forecast to double in size during the 2015/16 marketing year.
Farm exports for fiscal 2016 were forecast for $138.5 billion, down by $1 billion from USDA’s revised forecast of exports this year. Over the past year, the department has lowered the export forecast for 2015 by $5 billion, or 3.5 percent. Exports were a record $152.3 billion in fiscal 2014.
Agricultural imports are forecast for a record $122.5 billion in 2016, up 6 percent from this year, with the largest gains in horticulture, sugar and tropical products. The agricultural trade surplus, $24 billion this year, would drop to $16 billion. “This would be the smallest surplus since 2007,” said USDA.