Food and Agricultural Export Outlook in the Global Economy

8/3/2019 Food and Agricultural Export Outlook in the Global Economy

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1

Situation and Outlook ForGlobal Food and Agricultural Trade

September 29, 2010

Michael J. Dwyer, Director

Global Trade and Biofuels AnalysisOffice of Global Analysis

Foreign Agricultural Service/USDA


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Booming Exports Are A Major Growth FactorFor the U.S. Food and Agricultural Sector

Exports rebound to near record $113 billion in 2011 on rising demandin developing countries, falling dollar, and higher prices

0

20

40

60

80

100

120

1975 1978 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008 2011

(f)

U.S. agricultural trade ($ billion)

Exports

Imports

Fiscal years

Exports in 2011 up65% since 2006

Ag trade surplus to grow to $31.5 billion in 2011 one of few U.S. industries that still has a surplus


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Recent Export Gains Have Been Strongest toNAFTA and Non-Japan AsiaExports to Canada, Mexico, China, and SE Asia have responded to rapid economicgrowth and/or trade liberalization. In 2011, biggest gains are to Asia

US Ag Exports ($ Bil)

010

20304050

60708090

100110120

'86 '91 '96 '01 06 11f

0

10

20

30

40

50

'86 '91 '96 '01 06 11f

Share of Exports (%)

Canada

Mexico

Japan

Other AsiaEU-27

EUEU--2727

AsiaAsia

NAFTANAFTA

Rest ofWorld


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Top Markets Export PerformanceExports in $ billions, FY basis

Canada

CHINA

Mexico

Japan

EU-27

South Korea

Taiwan

Hong Kong

Indonesia

Turkey

2001 2011f % $8.0

$1.9

$7.3

$8.9

$6.5

$2.5

$2.0

$1.2

$0.9

$0.6

$16.8

$15.0

$14.6

$11.5

$8.6

$5.0

$3.2

$2.5

$2.1

$2.1

110

689

100

29

32

10060

108

133

250

2010 forecasts are from Outlook for U.S. Agricultural Trade, Aug 2010


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U.S. Is Not Only Major Exporter Seeing GainsS. America and S.E. Asia increased the most (%) -- EU and Australia saw

slowest growth

67.3

31.0

21.6

18.1

19.1

19.4

12.7

10.8

98.6

91.5

53.2

30.1

26.9

28.3

21.8

21.2

20.8

65.5

0 10 20 30 40 50 60 70 80 90 100

United StatesEU-27

Brazil

Canada

Argentina

China

Australia

Thailand

Indonesia

2005 2009

Total Agricultural Exports (bil $)

After relinquishing top spot to EU in 2005 and 2006, the U.S. regained the No. 1position since 2007

Source: GTIS using Global Trade Atlas. Definition of ag differs somewhat from Bureau of Census so U.S. stats not same as reported by FAS in BICO reports


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Leading Exports of U.S. Processed Products

Have Surged Since 2005

8

6.1

6.4

3

2.9

2.7

1.9

1.0

0.9

10.9

4.9

4.5

3.5

2.9

2.6

1.6

11.4

0 2 4 6 8 10 12

Meat and Poultry

Food Ingredients

Consumer Pack. Prod.

Beverages, Liquid

Frozen Foods

Snack Foods

Dairy

Vegetables

Billion $

20052010 (f)


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Top U.S. Processed Product Export MarketsExports in billion $

Canada

Mexico

Japan

EU-27

South Korea

Hong Kong

CHINA

CAFTA-DR

Taiwan

Russia

2000 2010f % $4.8

$2.7

$5.2

$2.8

$1.2

$0.9

$0.3

$0.5

$0.4

$0.5

$11.3

$6.2

$5.1

$4.9

$1.8

$1.7

$1.5

$1.1

$0.9

$0.8

136

131

-3

77

56

92390

121

109

77

Note: % change based on unrounded figures


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10U.S. exports of processed food products in 2009 ($ billion)

U.S. Processed Food Product ExportsFocused in Higher Income MarketsBut the best growth has been in developing country markets

$8.1

$1.0

$4.6

$16.8

$1.6

$2.1

$0.5

$0.6

$0.8

$1.6

$1.5

$0.9

$0.7

$1.7


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Longer Term

Global Trade Outlook

Strong global economic growth and rising incomes and populations,especially in emerging markets,will lead to rapid growth in middle

class households, boosting foreign demand for food products. This,

coupled with a competitively priced U.S. dollar and strong supportfrom the U.S. government, should lead to a significant increase inthe value of U.S. ag exports.


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What Is The Long Term Outlook ForU.S. Agricultural Exports?USDA conservatively projects exports will reach $119 billion by 2019,up $22.3 billion from 2009 levels

0

20

40

60

80

100

120

140

160

1987 1989 1991 1993 1995 1997 1999 2001 2003 2005 2007 2009 2011 2013 2015 2017 2019

U.S. agricultural exports ($ billion)

Fiscal Year

NOTE: * NEI goal is only 5 years. This has been projected out to 10 years here for the purpose of comparison

Source: USDA Agricultural Projections to 2019, February 2010

Projections (2010-19)

2009 Outlook

2010 Outlook

USDAs NEI Goal *


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8 Factors Impacting Global Food andAgricultural Markets Over the Next DecadeNet takeaway: strong demand growth, especially from emerging markets, will bethe central megatrend over the next decade, boosting global trade

Global economic growth Value of the U.S. dollar

Worldwide biofuels production

Role of trade and trade liberalization

Policy errors by governments

Energy prices Biotech developments

Additional crop land


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Middle ClassMiddle Class in Developing Countries Could Reach 616 Millionin Developing Countries Could Reach 616 Million

Households By 2020, Up 138% From 2009 LevelsHouseholds By 2020, Up 138% From 2009 Levels25% of households in these countries are middle class. By 2020,25% of households in these countries are middle class. By 2020, this couldthis could

increase to 49% and the impact on food consumption will be largeincrease to 49% and the impact on food consumption will be large

234

60

12

9

8

7

6

5

4

3

3

2

21

0 25 50 75 100 125 150 175 200 225 250 275 300 325 350

China

IndiaBrazil

Indonesia

Russia

Egypt

ThailandMexico

TurkeyVietnam

Philippines

Iran

PolandNigeria

Households with real PPP incomes greater than $20,000 (in millions)

2009 levels Proj gains by 2020

Developing countries with fastest growing middle class

Source: Global Insights Global Consumer Markets data as analyzed by OGA


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Food and Agricultural Export Outlook in the Global Economy

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