 991211 USDA Sees No Exports ImprovementDecember 1, 1999 Washington - USDA says there probably will not be any improvement in U.S. farm exports over the next year, further dampening farmers' hopes for a recovery in commodity prices. The department projected in August that farm exports would grow by $1 billion, to $50 billion, for the 2000 budget year that began Oct. 1. But the department now says in a report to be released shortly that agriculture exports will remain at $49 billion in fiscal 2000 because of growing stockpiles of grain worldwide. Since August, projected exports of wheat, corn and soybeans have dropped by 5.4 million tons, according to a summary of the report. "The main problem at the moment seems to be that the production in other countries is much stronger than had been expected. That's pushing the prices down," Carolyn Whitton, a trade specialist with USDA's Economic Research Service, said. Prices for wheat, corn, soybeans and other crops have fallen sharply over the past two years because of shrinking export markets, leading Congress to pass successive multibillion-dollar aid packages to soften the blow. U.S. farmers shipped nearly $60 billion worth of commodities overseas in 1996 but that dropped to under $54 billion by last year because of financial problems in Japan and other key Asian markets. Nearly half of U.S. wheat is grown for export and about 20% of the corn. USDA expects farm exports to Asia to drop slightly, to $18.3 billion in fiscal 2000. Asia's recent economic upswing leads some economists to think that U.S. farm exports could start rebounding in 2000. John Beghin, a trade expert at Iowa State University, said he thinks that USDA is being unnecessarily pessimistic. Demand for meat has been growing steadily throughout the region, which should increase sales of both U.S. meat and livestock feed, he said. "Their own meat sector is expanding but not fast enough" to supply their needs, he said. USDA expects exports of U.S. beef and pork are expected to rise from 1.6 million tons this year to 1.7 million tons in fiscal 2000. But exports of corn are expected to drop to 47.5 million tons for fiscal 2000, down from 51.9 million this year, according to the department. Shipments of wheat are projected to drop to 27.9 million tons, down from 28.8 million this year. Americans are expected to import $38 billion worth of foreign agricultural products over the next year, a slight increase over fiscal 1999. U.S. demand for foreign fruit, vegetables, juice and wine remains high because the strength of the dollar makes them relatively inexpensive to American consumers.
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