Stronger prices and rising demand for U.S. farm exports will propel sales to $142.5 billion for the fiscal year ending Sept. 30, said the USDA on Thursday. It would be the second-highest export total ever. By coincidence, the quarterly forecast was released on the same day that two of the largest export customers announced tariffs on U.S. farm goods in response to U.S. duties placed on their steel and aluminum. The effect the tariffs could have on ag exports is unclear.
With four months left in fiscal 2018, USDA economists said larger corn and cotton exports were the leading reasons they raised their forecast by $3 billion, or 2 percent, from the February projections. “Corn is forecast up $1.3 billion, to $10.3 billion, on both larger volumes and higher unit values, as weather-reduced crop prospects in South America improve U.S. export opportunities into the summer. Cotton exports are forecast up $800 million, to $6.2 billion, on strong foreign demand.”
The United States is involved in trade disputes with its three largest export customers — China, Canada, and Mexico, which combined buy 44 percent of U.S. farm exports. China is forecast to buy $21.6 billion worth of U.S. products, unchanged from the February estimate, although the pace of soybean exports to China is slowing, said the USDA. Sales were forecast at $21.2 billion to Canada, unchanged from February, and $19.4 billion to Mexico, up by $200 million based on increased corn sales.
Agricultural imports were forecast to hit a record $121.5 billion, with Mexico and Canada the top suppliers as usual. “Mexico’s projected sales total is now $24.7 billion, $700 million above the February forecast, due to increases in expected U.S. imports of goods such as fresh fruit and vegetables, and livestock and meat products. The value of Canadian agricultural products sold in the United States is expected to increase by $400 million, to $23.2 billion, due to upward adjustments to U.S. imports of processed grain and horticultural products,” said the USDA.