Ag exports to dip 5 percent, trade deficit nearly doubles

U.S. farm exports will be the smallest in four years due to lower prices for wheat, corn, and cotton, said the Agriculture Department on Thursday. China would remain the No. 1 customer for food and ag products, with Mexico a close second.

In a quarterly forecast, the USDA estimated food and ag exports at $169.5 billion this fiscal year, down 5 percent from fiscal 2023, which ended on Sept. 30. Imports were pegged at $200 billion, “largely driven by the strong U.S. dollar and resilient domestic demand.” The agricultural trade deficit of $30.5 billion, the largest ever, would be nearly double the current record of $16.7 billion for fiscal 2023.

The USDA lowered its forecasts for sales of wheat, corn, and cotton because of lower prices, and said soybean and sorghum receipts would fall because of smaller crops. Beef, pork, and dairy sales would also fall.

China was forecast to buy $29.5 billion worth of U.S. food and ag products, compared with $33.7 billion last year. Mexico would spend $27.9 billion and Canada $27.7 billion this year, said the USDA.

“Going into FY 2024, domestic demand for agricultural products remains resilient,” wrote USDA economists. “In addition to growth in import values, there have been noticeable shifts in trade patterns, with an increasing share of imports coming from North America and Europe and a decreasing share from Asia, particularly Southeast Asia.” Mexico and Canada account for 41 percent of food and ag imports.

The quarterly forecast for ag exports is available here.