Agricultural and Food Policy
 Agri Outlook
Radio
Number 138
Outlook/Noteworthy: Part 5.
USDA Long-Term Agricultural Projections
- Key Results on U.S. agricultural trade (5:20 minutes)
Audio/Video Script:
Dr. Bobby Coats
Extension Economist
University of Arkansas, Division of Agriculture
USDA’s long-term agricultural projections shows tight market conditions are
projected to persist for many commodities. I’m Bobby Coats Extension Economist
University of Arkansas Division of Agriculture.
Key results on U.S. agricultural trade include:
First, USDA projects that world consumption of many grain, oilseed, and meat
commodities has exceeded world production. Tight market conditions are projected
to persist for many commodities, leaving agricultural commodity prices high over
the next ten years.
Second, USDA projects that broad-based global economic growth will provide a
foundation for robust gains in world demand for agricultural products. Rapid
expansion of ethanol and biodiesel production in some countries will add to
global agricultural demand growth for agricultural commodities.
Third, USDA projects the United States will remain competitive in global
agricultural markets, although trade competition will continue to be strong.
Expanding production in a number of countries, including Brazil, Argentina,
Canada, Ukraine, and Russia are projected.
Fourth, USDA projects continuing growth in the livestock sectors of
developing countries of Asia, Latin America, North Africa, and the Middle East
will account for most of the growth in world coarse grain imports projected
during the next decade. With the U.S. increasing corn ethanol production, corn
production and exports are assumed to increase for Argentina, Ukraine, Republic
of South Africa, and Brazil.
Fifth, USDA projects vegetable oil prices will increase in response to
rapidly rising demand for food use in low- and middle-income countries.
Additionally, vegetable oil prices will rise relative to prices for oilseeds and
protein meals because of expanding biodiesel production in a number of
countries.
Sixth, USDA projects the United States, Australia, the EU, Canada, and
Argentina the primary exporters of wheat will have growing competition from
Russia and Ukraine, due to their low costs of production and continued
investments in their agricultural sectors.
Seventh, USDA projects cotton consumption and textile production are
projected to increase in countries where labor and other costs are low, such as
China, India, and Pakistan. USDA sees the United States continuing as the
leading cotton exporter, reflecting its large production capacity and
its reduced domestic mill use of cotton as apparel imports continue to grow.
Eighth, USDA projects long-grain varieties of rice to account for around
three-fourths of global rice trade and for the bulk of trade growth over the
next decade. USDA projects Indonesia, the Philippines, and Bangladesh to become
the three largest rice-importing countries and account for about 30 percent of
the increase in global rice trade. Thailand, Vietnam, the United
States, India, and Pakistan will remain the world’s largest rice-exporting
countries.
Ninth, USDA projects U.S. meat exports will benefit from strong foreign
economic growth. However, even with U.S. beef exports to Japan and South Korea
assumed by USDA to gradually rebuild, total U.S. beef exports do not return to
levels of 2000-03 until late in the 10 year projections.
Tenth, USDA projects Pacific Rim nations and Mexico to be key markets for
long-term growth of U.S. pork exports. Higher income countries of East Asia will
increase pork imports as their domestic hog sectors are constrained by
environmental concerns. Mexican pork imports will rise rapidly, driven by
increases in income and population. Brazil is constrained in its pork trade by
the presence of foot-and-mouth disease, but continues to be a major pork
exporter to markets such as Russia, Argentina, and Asian markets other than
Japan and South Korea.
Finally, USDA projects Brazil will remain a leading poultry exporter as low
production costs allow the Brazilian poultry sector to remain competitive in
global trade. Poultry exports from countries affected by avian influenza, such
as Thailand and China, are expected to be mostly fully cooked products destined
for higher income markets.
This has been Bobby Coats Extension Economist University of Arkansas Division
of Agriculture.
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