USDA Chief Economist Seth Meyer says export volumes may increase but at low prices. “A lot of this is tied to falling commodity prices, and the world getting a lot more comfortable with where supplies of corn, wheat, beef, and cotton all are relative to where we were between 2020 and 2023,” he said. “Yes, volumes are up a little bit, but that is because, in order to move a more abundant product, you are having to see some price declines to move some of that stuff out the door.”
The fiscal year 2025 could cause producers dependent on exports to tighten their belts, as USDA is projecting that year’s exports at $169.5 million, which is down $4 billion from this current year, and down 26.5 billion from two years ago.
Meyer said that in addition to falling commodity prices, other things around the world are affecting the export prices. He listed, “Maybe a slower Chinese economy, continued strength of the U.S. dollar, China diversifying its sources for trade, perhaps a little bit weaker on export competitiveness for ourselves… those are all things which are posing some challenges for our exports.”
Meanwhile, exports continue to rise. The USDA reports that 2025 could end up with an Ag Trade Deficit of more than $42 billion.
The USDA projects an $8 billion increase in imports to a total of $212 billion for fiscal year 2025. Meyer explained, “This means a rising trade deficit of $42.5 billion for cash for fiscal year 2025, up from a revised $30.5 billion trade deficit the prior year. That is on the order of about a 35 percent increase in the trade deficit.”
