Trade Winds in Agriculture

Transcription

1 Trade Winds in Agriculture November 2, 2018 Dr. Scott Brown MU-CAFNR: Director of Strategic Partnerships

2 Overview Trade uncertainty has increased as past trade agreements are renegotiated New USMCA agreement awaiting ratification Other trade discussions ongoing Tariff escalation with China remains front and center Disease outbreaks and other events can cause abrupt effects

3 Billion Dollars U.S. Agricultural Trade: A Two-Way Street Exports Imports

4 Index, avg. = 1.0 Trade: Why is it Important? Corn+Soy+Wheat Prod. Beef+Pork+Chicken Prod. U.S. Population

5 Index, avg. = 1.00 Trade: Why is it Important? U.S. Population ROW Population

6 Index, avg. = 1.0 Trade: Why is it Important? U.S. Real GDP ROW Real GDP

7 Percent Value of Ag Exports / Farm Receipts

8 Top Commodity Exports, Billion $ % of total Soybeans % Corn % Wheat % Other Feeds & Fodder % Cotton % Misc Hort Products % Beef & Veal % Pork % Soybean Meal % Almonds %

9 Top Commodity Imports, Billion $ % of total Coffee % Wine % Cocoa and Products % Malt Beverages % Beef & Veal % Misc Hort Products % Biscuits & Wafers % Other Grains % Other Beverages % Essential Oils %

10 Top Export Destinations, Billion $ % of total China % Canada % Mexico % Japan % European Union % South Korea % Hong Kong % Taiwan % Indonesia % Philippines %

11 Index 2012 = 1.00 U.S. Exchange Rate Versus Major Trading Partners

12 Percent U.S. Soybean Exports as % of U.S. production as % of world exports (p)

13 Percent U.S. Corn Exports as % of U.S. production as % of world exports (p)

14 Percent U.S. Beef Exports as % of U.S. production as % of world exports

15 Percent U.S. Pork Exports as % of U.S. production as % of world exports

16 Million Metric Tons Major Soybean Importers China EU ROW U.S. exports (p)

17 Million Metric Tons Major Soybean Exporters (p) U.S. Brazil Argentina ROW

18 Million Metric Tons Major Corn Importers (p) Japan Korea Mexico ROW U.S. exports

19 Million Metric Tons Major Corn Exporters (p) U.S. Brazil Argentina ROW

20 Million Metric Tons Major Beef Importers (p) U.S. Japan Russia ROW U.S. exports

21 Million Metric Tons Major Beef Exporters (p) Australia Brazil India ROW

22 Million Metric Tons Major Pork Importers (p) China Japan Mexico ROW U.S. exports

23 Million Metric Tons Major Pork Exporters (p) U.S. EU Canada ROW

24 Million Metric Tons World Skim Milk Powder Production (p) EU US India New Zealand Australia ROW

25 Million Metric Tons World Whole Milk Powder Consumption (p) China Brazil EU Algeria Indonesia ROW

26 Percent China Tariffs for Selected Products $39,921M Value of exports since Jan 2015 (Million U.S. $) $748M $630M $240M $70M Soybeans Swine offal frozen Swine cuts frozen Hams bone-in frozen April 2 increase July 6 increase current applied rate Bovine meat

27 November 2018 Soybean Futures

28 Dollars per Cwt. Ham Primal Value avg tariff

29 Million $ U.S. Pork Export Value to China/HK 1,200 1, Including Variety Meat Not Including Variety Meat

30 Summary Future consumption growth comes from outside the U.S. Different risks come from export markets versus domestic markets New trade restrictions always possible Effects that shutoff access to countries Economic growth Negotiating trade agreements can create uncertainty Production growth depends on strong domestic and international demand