USDA recently forecasted that in fiscal year (FY) 2005 (October 2004 to September 2005) U.S. agricultural imports will equal exports for the first time since the late 1950s. The fact that total imports will be $56 billion tells nothing about what is imported, the competition provided to U.S. farmers and ranchers and the benefit to consumers. A look at actual imports for 2002 to 2004 provides some details. One way to categorize imports is by non-competing agricultural products (products with no or limited production in the U.S.), fresh fruits and vegetables, and competing products. These categories are not perfect, but the breakdown provides a good overview.
The non-competing products are just under 20 percent of total agricultural imports. Some products come immediately to mind, like bananas and coffee, while others are not as obvious, like cocoa and rubber. Table 1 shows major non-competing product imports for FY2002 to FY2004.
The non-competing products were valued at $9.67 billion and accounted for 18.3 percent of U.S. agricultural product imports for FY2004. These imports have increased by over 40 percent in value over the past two years.
One of the most contentious areas of trade policy is imports of fresh fruits and vegetables. Some of the imports are off-season in the United States, while other products compete with U.S. production during significant production seasons. Imported grapes from Chile, oranges from South Africa and tomatoes from Mexico are just a few examples of imported fresh fruits and vegetables. The U.S. is often a major importer and a major exporter of the same products, depending on the time of the year and region of the country. Table 2 shows both imports and exports for fresh fruits and vegetables for the last two fiscal years.
For FY2004 imports of these products totaled $5.83 billion and accounted for 11.1 percent of U.S. agricultural product imports. Exports were $3.67 billion for FY2004.
Imports of agricultural products that compete with U.S. agricultural products throughout the year account for roughly 70 percent of all imports. These range from relatively small amounts of bulk grain products to billions of dollars of products like wine and snack foods. Table 3 provides a summary of the key imported products.
These competing products are overwhelmingly consumer oriented with substantial amounts of processing. Some of the major imported competing products, like beer and wine, are often not thought of as “agricultural” products. The value of snack foods is mostly in the processing and packaging, not in the raw products produced by farmers and ranchers. For the products detailed in Table 3, only tobacco, grains and sugar are bulk commodities (products that are in their raw state). Live animals and the oils are considered intermediate products where some processing has occurred. All the other items are considered consumer oriented because they need little or no processing to make them available for sale to consumers.