Agricultural exports in any particular year are subject to the usual weather conditions that influence supply and economic conditions that drive demand. Economists attempt to understand long-term trends that foreshadow potential supply and demand. Each year the Economic Research Service of USDA provides ten-year supply and demand projections for major countries and regional markets for bulk crops and meats.
At a time of record agricultural exports in dollar value, many traditional U.S. bulk commodities have been declining in volume shipped. The volume of exports for commodities covered in this report peaked at fiscal year (FY) 2008 at 118 million metric tons (MMT) and declined in the recession year, FY 2009, to 100 MMT. There was a modest recovery in FY 2010 to 105 MMT and further recovery in FY 2011 to 108 MMT. The short crops in FY 2011 and FY 2012 reduced these bulk exports to 93 MMT in FY 2012 and the projections for this year, FY 2013, are bleaker at 79 MMT. Some markets will grow slowly in the years immediately ahead and there will be increased competition for the limited markets.
The meat markets are a bright spot because these are generally growing markets. Global beef and veal exports are expected to grow to 10.93 MMT in 2022 from an average of 8.22 MMT in 2011 and 2012, a 33 percent increase. U.S. exports will increase from an average of 1.19 MMT in 2011 and 2012 to 1.48 MMT in 2022, a 24 percent increase, after first shrinking to 1.08 MMT in 2015 as the U.S. cattle herd rebuilds from the multi-year drought. U.S. imports of beef will continue to increase from an average of 0.98 MMT in 2011 and 2012 to 1.56 MMT in 2022, a 59 percent increase, 21 percent of the world increase and the largest volume increase. Brazil will increase beef exports from 1.37 MMT to 1.89 MMT, a 38 percent increase and 19 percent of the world increase, while India increases exports from an average of 1.49 MMT to 2.87 MMT, a 93 percent increase and 51 percent of the world increase.
World pork exports are expected to grow from an average of 7.12 MMT in 2011 and 2012 to 8.33 MMT in 2022, a 17 percent increase. U.S. exports of pork will increase from an average of 2.42 MMT to 2.83 MMT, also a 17 percent increase allowing the U.S. to maintain a 34 percent market share. Brazil will increase pork exports from 0.59 MMT to 0.78 MMT, a 32 percent increase. The EU-27 is expected to increase exports from 2.42 MMT to 2.59 MMT in 2022, a 7 percent increase. China will have the largest growth in imports from 0.77 MMT to 1.22 MMT, a 0.450 MMT or 58 percent increase and 37 percent of the world increase.
Global poultry meat exports will increase from an average of 10.34 MMT in 2011 and 2012 to 12.98 MMT in 2022, a 26 percent increase. U.S. poultry meat exports are expected to increase from 3.55 MMT to 3.90 MMT, a 10 percent increase and 13 percent of the global increase. Brazilian poultry meat exports are expected to increase from 3.61 MMT to 4.77 MMT, a 32 percent increase and 44 percent of the expected global increase. Mexico will have the largest import increase from 0.77 MMT to 1.24 MMT, a 61 percent increase and 18 percent of the global increase.
Wheat is one of the widely traded grains that varies with production and the amount used in livestock feed as a substitute for corn. Global trade for 2011/12 and 2012/13 averaged 144.5 MMT. Exports are expected to continue their steady expansion to 163.7 MMT by 2022, a 13 percent increase. The U.S. is not expected to participate in that expansion. U.S. exports are expected to decrease from an average of 29.3 MMT for 2011/12 and 2012/13 to 27.2 MMT in 2013/14. They then plateau at 25.6 MMT for most of the 10 years. Ukraine exports are expected to more than double to 12.6 MMT in 2022/23. Russia recovers from recent weather problems and exports are projected at 25.3 MMT by 2022/23. The EU-27 will also be at 25.2 MMT of exports by 2022, up from an average of 17.0 MMT for the last two years. Canada will be much like the U.S. and stable at 18.0 MMT of exports, while Australia has stable exports at 19.0 MMT.
Global corn exports are expected to grow rapidly from an average of 100.5 MMT in 2011 and 2012 to 138.7 MMT on 2022, a 38 percent increase. The U.S. will show growth in exports from an average of 34.2 MMT in 2011/12 and 2012/13 to 63.5 MMT in 2022/23. Three below average U.S. corn crops in row have decimated U.S. exports to an estimate of only 20.3 MMT for 2012/13, the lowest since 1971/72 and about a third of the record export years of 61.0 MMT in 1979/80 and 61.9 MMT in 2007/08. The U.S. share of the world corn export market has slid from 63 percent in 2007/08 to a projected 23 percent in 2012/13. U.S. market share would recover to 46 percent in 2022/23. Ukraine corn exports are expected to increase from 13.8 MMT to 19.6 MMT, a 42 percent increase. Chinese corn imports will increase from 3.6 MMT to 19.6 MMT in 2022/23, a 540 percent increase and 42 percent of the world increase in corn trade. Mexico’s corn imports will increase from 10.1 MMT to 16.9 MMT, 67 percent increase.
World soybean exports are expected to continue to have rapid growth from an average of 94.4 MMT in 2011/12 and 2012/13 to 144.3 MMT in 2022/23, a 53 percent increase. U.S. soybean exports will increase from 36.8 MMT to 43.8 MMT, a 19 percent increase. China will continue to be the demand leader in the world with imports growing from an average of 61.1 MMT in 2011/12 and 2012/13 to 102.9 MMT in 2022/23, a 68 percent increase and 84 percent of the increase of world trade. Brazil is expected to increase soybean exports from 36.8 MMT to 63.8 MMT, a 73 percent increase, while Argentina increases exports from 9.7 MMT to 17.5 MMT, an 80 percent increase.
Global cotton exports are expected to grow modestly over the next ten years. Cotton trade was abnormally large in 2011/12 due to stocks building in China so 2012/13 is used as the base year. Exports are expected to increase from 36.6 million bales in 2012/13 to 38.6 million bales in 2022/23, a 5 percent increase. U.S. exports are projected to increase from 11.6 million bales to 13.3 million bales in 2017/18 on forward, a 15 percent increase.
Global rice exports are expected to increase from an average of 37.4 MMT in 2011/12 and 2012/13 to 46.9 MMT by 2022/23, a 25 percent increase. U.S. rice exports are expected to be 4.2 MMT in 2022/23, a 31 percent increase.
Real market outcomes can be far different than projections. U.S. producers and marketers have a challenging time ahead to compete in markets with more suppliers of bulk commodities.
Ross Korves is a Trade and Economic Policy Analyst with Truth About Trade & Technology (www.truthabouttrade.org). Follow us: @TruthAboutTrade on Twitter | Truth About Trade & Technology on Facebook.