USDA Sees Growth in U.S. Ag Exports

February 13, 2012 05:00 AM
 

USDA, in its long-term baseline projections through 2020-21, says a weaker U.S. dollar will remain a facilitating factor in projected gains in U.S. ag exports. While saying global trade will be strong, USDA says the U.S. will remain competitive, contributing to increases in cash receipts for U.S. farmers.

Link to full report.

In the report, USDA states, "The return of global economic growth beginning in 2010 and the continuation of population gains are expected to boost food demand. This is particularly true since world growth is concentrated in emerging markets and developing countries with high income-related propensities for consumption of food and agricultural products. In addition, growing biofuel demand will remain an important factor shaping the projections for world trade, U.S. agricultural exports, and commodity prices. Also supporting the outlook for U.S. agricultural exports is the cumulative effect of the depreciated U.S. dollar since 2002 and its continued decline through the projection period. The declining dollar makes U.S. agricultural exports increasingly competitive in international markets."

Regarding commodity prices, USDA says, "Prices for major crops are projected to decline in the near-term as production globally responds to current high prices. Nonetheless, after near-term price declines, long-term growth in global demand for agricultural products, in combination with the continued presence of U.S. ethanol demand for corn and EU biodiesel demand for vegetable oils, holds prices for corn, oilseeds, and many other crops at historically high levels."

Additionally, USDA says while prices for major crops are projected to decline in the near term as production globally responds to current high prices, long-term growth in global demand for agricultural products, in combination with the continued presence of U.S. ethanol demand for corn and EU biodiesel demand for vegetable oils, holds prices for corn, oilseeds, and many other crops at historically high levels.


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