Washington - The forecast for fiscal 1998 U.S. agricultural exports to South Korea was slashed 27% to $2.4 billion from a December projection of $3.3 billion, the U.S. Agriculture Department said on Monday.
In a quarterly report, USDA also lowered its estimate of overall U.S. agricultural exports this year to $56.0 billion, down from the December forecast of $58.5 billion. More than 80% of the $2.5 billion downward revision was due to reduced Asian demand.
While South Korea represents the single biggest drop in the overall export forecast, USDA also trimmed its projection for Southeast Asian countries by 20% from December to $2.3 billion and for Japan by 5.5% to $10.3 billion.
The Japan forecast reflects stagnant economic growth and expected reduced demand for higher priced meats, such as the better cuts of beef imported from the United States. Japan has also increased its imports of lower-priced Argentine corn and sorghum at the expense of the United States, USDA said.
The reductions for South Korea and Southeast Asia also reflect increased competition from Chinese and Argentine corn, but the far bigger factor is the countries' financial woes which have reduced their purchasing power, USDA said.
South Korea will import more corn from China this year, but the United States should be able its market share with the help of USDA export credit guarantees, USDA said.
USDA lowered its forecast of agricultural exports to Latin America to $10.8 billion, down about 3% from the December forecast of $11.1 billion.
The reduction reflects increased Argentina corn sales in the region, USDA said.
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