All major U.S commodity groups should reach record export sales in 2008. Both higher prices and higher export volumes will contribute to grain export growth. Soybeans will grow dollar export value, but the gain will come on higher prices but lower volume.
"We project U.S export trade value for 2008 will be $101 billion," Mark Keenum, USDA under secretary for Farm and Foreign Agricultural Services told participants at USDA annual Outlook Forum in Washington, D.C. "That will top our previous export record of $81.9 billion set just last year."
USDA projects ag imports will rise from $70 billion in 2007 to $76.5 billion this year.
The bottom line is the U.S. ag trade surplus should rise from $11.9 billion in 2007 to $24.5 billion this year.
Key export drivers
Keenum has a short list of factors he sees boosting farm exports. They are:
• Strong growth in global demand.
• Our weak and continuing to weaken dollar, which makes U.S. exports more attractive to foreign buyers.
• Growth in renewable energy markets here and abroad.
• Reduced foreign competition as some countries have experienced weather production set backs and demand growth continues to outpace growth rate of quantities producers are able to supply.
• Policy moves here and with our trading partners.
Keep focus on leveling the playing field
"We need to continue working to liberalize trade, while making it fair trade," says Keenum. "Despite continuing negotiating efforts, U.S. ag exports still face roughly 62% tariffs in markets we're trying to enter. Meanwhile products from other countries face only 12% tariffs here.
"We need to continue efforts to level the playing field," he asserts. Our three pillars for agricultural trade are:
• Eliminating export subsidies.
• Reducing trade-distorting domestic supports.
• Increasing market access.
"We need to maintain vigilance to avoid situations where trading partners reduce tariff trade barriers only to replace them with sanitary and phyto-sanitary regulations that effectively limit our access to their markets," he says.
"Trade policy, farm policy, energy policy and health policy are all inextricably linked here and abroad," he says. "Developing policies that recognize all of those inter-relationships will benefit all trading partners, now and in the future."