Optimistic Outlook Expressed for U.S. Agricultural Exports
STILLWATER (JR) -- Some good opportunities exist for a general increase in U.S. agricultural exports the rest of this decade as economic and social situations in some regions of the world continue to evolve.
A strong point of good news is that the United States has successfully made a structural transformation away from a nearly complete dependence on raw commodity exports to a more diversified agricultural export portfolio, said David Henneberry, Oklahoma State University professor of international trade. He notes that more than half of all U.S. agricultural exports now are "value-added" products that provide more income and employment in the United States before reaching their consumer destination in other countries.
The financial crisis in Asia late last year spread into a general decline in stock market values in Thailand, Hong Kong, Singapore and Indonesia, and many economists became very concerned about spread of international financial instability, Henneberry said. "Asian economies are particularly important to U.S. agriculture," he says. "Japan is our top agricultural export customer. South Korea is fourth, Taiwan is fifth, China is seventh and Hong Kong is eighth in importance." However, as important as they seem, the Asian stock market declines probably will have little impact on U.S. agricultural exports to the Pacific Rim, Henneberry said. "Asian countries will respond by increasing their exports of consumer goods at more competitive prices," he said. "So the U.S. trade deficit may grow, as U.S. non-agricultural imports will increase." But agricultural imports by Pacific Rim countries also may even increase during this period of financial stress. …