USDA forecasts record ag exports in FY 2022
U.S. agricultural exports in fiscal year (FY) 2022 are projected at $177.5 billion, $4.0 billion higher than the revised forecast for the preceding year, according to a report from the USDA’s Economic Research Service published on Aug. 31.
The FY 2021 export forecast of $173.5 billion represents an increase of $9.5 billion from May’s projection, mainly due to higher livestock, dairy, and poultry exports, as well as the adoption of a new definition of “Agricultural Products.”
The ERS is adopting the World Trade Organization’s (WTO) definition of “Agricultural Products,” which adds ethanol, distilled spirits, and manufactured tobacco products, among others, while removing rubber and allied products from the previous USDA definition. The net effect of the definitional change on historical values is that U.S. agricultural exports under the new definition averaged $4.7 billion higher per year during FY 2018–2020 from the previous definition, and U.S. agricultural imports averaged $9.9 billion higher annually during the same period.
The FY 2022 forecast value increase is primarily driven by higher export values for soybeans, cotton, and horticultural products.
Soybean exports are projected to increase by $3.3 billion from FY 2021 to a record $32.3 billion on higher prices, which more than offset lower projected volumes. Cotton exports are forecast up $500 million to $6.8 billion on higher unit values. Horticultural product exports are forecast up $600 million to a record $37.7 billion, led by higher exports of tree nuts.
Livestock, dairy, and poultry exports are forecast up $400 million to $36.8 billion in FY 2022, primarily due to growth in dairy and poultry products. Grain and feed exports are forecast down $1.1 billion from prior forecast levels, primarily due to lower corn export prospects. Agricultural exports to China are forecast at $39.0 billion—an increase of $2.0 billion from FY 2021—largely due to higher expected soybean prices and strong cotton and sorghum demand. Agricultural exports to Canada and Mexico are forecast at $23.8 billion and $22.3 billion, respectively.
U.S. agricultural imports in FY 2022 are forecast at $159.5 billion, $2.0 billion higher than the revised FY 2021 due to higher imports of livestock and beef products, oilseeds and products, and horticulture products. FY 2021 imports are forecast at $157.5 billion, up $15.7 billion from the previous forecast, primarily resulting from the inclusion of distilled spirits and other products in the new “Agricultural Products” definition. Record-level import values in the third quarter of FY 2021 largely due to pent-up demand from the pandemic shutdowns of entertainment and service industries, which was released driving up purchases and prices of wine, beer, fruits and vegetables, and other horticultural products, at least in the short term.
Effective Jan. 1, 2021, the separation of the United Kingdom (UK) from the European Union-27 (EU27) was complete, including trade between both entities. Starting with this August 2021 release, the Outlook for U.S. Agricultural Trade is reporting on EU27 and the UK separately, rather than a joint EU27+UK in previous quarters.