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Ag trade deficit is multifaceted

An economist with the American Farm Bureau Federation says the United States’ lack of participation in the Comprehensive and Progressive Agreement for Trans-Pacific Partnership is impacting ag exports.

Betty Resnick tells Brownfield, “We’re specifically seeing that impact exports to Asia and as the CPTPP is entering into force for a lot of our big trading partners specifically, for example, Vietnam.”

“They’re starting to import more from countries besides the United States for a lot of products,” she says.

The USDA raised both ag exports and imports for fiscal year 2024 in its latest forecast, yet the trade deficit remains at a record $30.5 billion and nearly double what it was in 2023.

Resnick says declining soybean exports are a major factor in addition to a strong dollar.

“Brazil has been increasing their exports of soybeans pretty dramatically over the past couple of years,” she says. “We’re also seeing some our main trading partners in soybeans, specifically China, try to diversify away from the United States potentially, so they’re increasingly buying a lot of soybeans from South America.”

Horticulture imports make up the largest category of U.S. ag imports and include items the U.S. cannot grow along with alcohol imports. But over the last decade, Resnick says, “We’ve had a huge increase in imports of things like fresh fruit and fresh vegetables.”

Resnick says she’s closely following how those imports are negatively impacting American growers during their domestic season.

She says the geopolitical climate has also factored into the trading landscape along with shifting global transportation routes.

Members of the CPTPP include Australia, Brunei Darussalam, Canada, Chile, Japan, Malaysia, Mexico, Peru, New Zealand, Singapore, and Vietnam.