“This is a major boost for the economy as a whole, and particularly for our rural communities, with agricultural exports stimulating local economic activity, helping maintain our competitive edge globally, supporting producers’ bottom lines, and supporting more than 1.3 million jobs on the farm and in related industries such as food processing and transportation,” said Secretary of Agriculture Tom Vilsack.

Worldwide exports of many U.S. products, including soybeans, corn, beef, pork, dairy, distillers grains and pet food, reached all-time highs.

China remained the top export destination, with a record $33 billion in purchases, up 25 percent from 2020, while Mexico inched ahead of Canada to capture the number two position with a record $25.5 billion, up 39 percent from last year.

The remaining export markets in the nation’s top 10 markets all saw gains in 2021. In addition to China and Mexico, Canada, South Korea, the Philippines and Colombia also broke import records of U.S. ag.

Source: USDA

Ports along the Texas Gulf account for 23 percent of wheat exports, 1.5 percent of corn exports, and a half a percent of soybean exports.

The Mississippi Gulf is much more consequential for soybean and corn. The export facilities along the lower Mississippi River between Baton Rouge and the Gulf of Mexico account for 60 percent of soybean exports, 59 percent of corn exports, and 15 percent of wheat exports.

Source: Ohio Ag Net

Under the terms of the partial trade arrangement, Chinese spending on U.S. farm goods will scale to an annual figure of $40 billion to $50 billion over two years, Treasury Secretary Steven Mnuchin has said.

U.S. ag exports to China peaked at roughly $25 billion under the previous White House administration.

China wants a rollback in tariffs in the trade war before it can feasibly agree to buy as much as $50 billion of American agriculture products. China will continue to make goodwill purchases between now and mid-November, according to Politico. That is when Trump meets with Chinese President Xi Jinping at the Asia-Pacific Economic Cooperation summit in Chile.

The intent is for China to scale up its purchases to record levels in 2020. By 2021, Beijing will have removed non- tariff barriers tied to food safety and GMO approvals, opening China’s floodgates to a surge of U.S. farm goods.

Chinese firms this year have bought 20 million tons of U.S. soybeans and 700,000 tons of pork, and that is expected to accelerate.

Also on China’s shopping list: cereals, cotton, ethanol, fertilizer, juice, coffee and meat. The country could also lift barriers on distillers dried grains and remove a ban on chicken imports.

China has also indicated that any increase in imports will depend on market demand, as well as compliance with global trade rules and the removal of U.S. tariffs.

Sources: Politico, Bloomberg

Prices for many cuts of beef were advertised higher this week than at this time last year, according to the U.S. Department of Agriculture. A common variety of ground beef sold for an average of $3.75 a pound this week, for instance, up nearly 20 percent from a year earlier.

The rally coincides with the continued spread of African swine fever in Asia. The virus—fatal for pigs but harmless to humans—was found in South Korea in September, after surfacing in North Korea in May. As of last week, 145,000 pigs have been culled in South Korea, the government reported.

The disease has devastated hog herds in China, the world’s largest pork market. Roughly 1.17 million hogs have been culled there since August 2018 in an effort to stop the disease, according to the Food and Agriculture Organization of the United Nations. This widespread slaughter has pushed the price for pork in China up 69 percent.

The U.S. beef industry is aiming to fill some of that protein deficit. Beef exports to South Korea are already 8 percent higher than last year, totaling 174,290 metric tons through August, according to the U.S. International Trade Commission.

Exports to Japan were 3 percent lower in that time frame, but demand is expected to pick up as meat supplies tighten in the region. A U.S.-Japan trade deal reached in August also will likely boost demand. The agreement reduces or removes tariffs on some $7 billion in U.S. agricultural goods exported to Japan annually, including beef.

Source: Wall Street Journal