Data on the value of U.S. agricultural exports by State of origin are not part of the U.S. export information collected by U.S. Customs and Border Protection. U.S. agricultural commodity exports are often produced in inland States and pass through several marketing or processing points before arriving at a port. As the commodity passes through other States before being exported, the State-of-origin often is lost or the product commingled with similar product from other States. Frequently, the State from which the commodity last started its export journey, not necessarily the State in which the commodity was produced, is the State of origin reported by the exporter.
ERS has historically provided estimates of State agricultural exports by allocating export values of major agricultural products to States based on estimated State shares in U.S. production of those products. ERS is now introducing a new series of State export estimates in which export values are allocated to States based on their shares of U.S. agricultural cash receipts for those products. This new approach preserves the "origin of production" function of the production-based allocations, but accounts for differences in product prices and for on-farm use across States, and uses consistent calendar year data for both U.S. agricultural exports and U.S. farm cash receipts.
Changes in State Export Data in 2014
The 2014 update of State Export Data included several changes from the 2013 update. The number of agricultural commodity categories for which estimates are provided is reduced from 23 to 20 in 2014. The coverage changes are made in response to changes in the coverage of U.S. farm cash receipts data released by the Economic Research Service and, in some cases, to reduced levels of U.S. exports in a commodity category. ERS uses a $2 billion level of exports as the cutoff for inclusion as a separate category. Below are the major changes made in the 2014 update:
- Tree nuts are combined with processed fruits because cash receipts for tree nuts are not available separately from fruits.
- Tobacco, planting seeds, and sugar and products are now included in “Other plant products” because their U.S. export values were all lower than $2 billion in 2013. The same cutoff value is used for the other commodities in the group: Wine, essential oils, other grains, other oilseeds and oilseed products, and other processed foods.
- Soybean exports are based on State shares of farm production values from the USDA National Agricultural Statistics Service because farm cash receipts for soybeans were not released in 2014.
- A new “Other livestock products” group was separated from “Other Products” in the 2013 export commodity list to allow separation of animal products from plant products.
- “Poultry products” replaced the former “Chicken meat” export estimates in order to include other poultry products.
- “Total animal products” and “Total plant products” summations are added to provide aggregate export estimates for the two agricultural sectors.
Methodology Based on Farm Cash Receipts
Tracking export products back to their original source of production is difficult and complicated, and information on agricultural exports by State is not part of the data collected by the U.S. Customs and Border Protection agency. Recording the State of production of farm products that are exported is not straightforward because of lack of documentation or specific source information for processed products or mixed shipments. A large portion of U.S. agricultural commodities, such as grains and soybeans, are produced in inland States. Bulk commodities are typically first sold to a local elevator, which in turn may sell them to a larger elevator where they are mixed with similar commodities from other States before transport to a seaport or border crossing. Tracking the source State is even more complicated for processed agricultural products. Processors and manufacturers may use raw materials from a number of States, and final processed products may undergo multiple processing steps in different States before reaching the port for foreign shipment. Instead of tracing commodities or products back to their original State of production, it is more straightforward and feasible to allocate exports by production shares, whether based on volume or value.
Using farm production value-or cash receipts-to compute State exports shares provides consistency because both the export values to be estimated and farm receipts data are expressed in value terms. With this approach, the sales revenue received by U.S. farmers for their commodities is estimated by ERS using data on farm cash receipts. These receipts are calculated from production quantities and prices, or from production values, in each U.S. State during the calendar year. The production volume, prices, and value of agricultural commodities in each State are estimated from farm survey data collected by USDA's National Agricultural Statistics Service. Farm cash receipts provide the basic information of the value of agricultural production that is sold, whether in the domestic market or to the international market. The national sales amount for each farm commodity equals the sum of each State's farmgate sales receipts of that commodity.
In order to estimate the value of a State's sales of agricultural commodities to the international market, the share of a commodity's farm receipts by State needs to be determined. These shares are then applied to the U.S. agricultural export value of that commodity. That is, a State's estimated export value of a commodity is determined by that State's share of the total U.S. farm receipts from sales of the given commodity. In order to match U.S. agricultural exports closely with farm receipts, exports are grouped as closely as possible according to the ERS farm sales commodity groupings. This matching is important because a State's export estimate for a commodity, and the products processed from it, depends on the State's share of total U.S. farm sales for that commodity.
A State's farm receipts for agricultural commodities produced and harvested within its geographic boundaries are organized by ERS under one of two sectors: 1) Livestock and products; and 2) Crops and products. The livestock sector is further subdivided into meat animals, dairy products, poultry and eggs, and miscellaneous livestock. The crop sector consists of food grains, feed crops, cotton, tobacco, oil crops, vegetables, fruits and nuts, and other crops. Overall, the farm receipts-based estimates are provided for 28 commodity groups and individual commodities. The total farm receipts for each commodity group are the sum of the farm receipts from all 50 States. U.S. agricultural exports, including processed products, are summed into the same commodity groups as are farm receipts. Estimates of State export values of a commodity or commodity group are calculated by multiplying each State's share of total U.S. farm receipts for that commodity or group by the U.S. export value corresponding to the same commodity or group.
For commodity groups that include processed products, value added from processing can inflate the estimated export value for that commodity group since corresponding farm receipts do not account for processing costs. As such, the sum of estimated exports of commodities in a group may exceed the separately estimated export value of that commodity group. To ensure consistency with actual U.S. agricultural export values, each State's export estimates are calibrated to equal the actual U.S. export values for each commodity and commodity group.
Methodology Based on Agricultural Production
Historically, the ERS State export estimates were computed by fiscal year and were allocated to individual States using State-level agricultural production data supplied by the National Agricultural Statistics Service (NASS). The underlying crop and livestock production and slaughter estimates by State are publicly available from NASS on their Data and Statistics page. The State's share of production of the commodity is simply applied to the U.S. export figure for the commodity to derive export value. NASS does not provide production statistics for processed agricultural products such as pasta. For these products, supplemental data from the 2007 Census of Agriculture and the Department of Commerce's 2002 Economic Census, Subject Series, Manufacturing Product Summary have been used to refine State export estimates.
The production-based estimates are provided for 20 commodity groups, including "other." "Other" includes the many disparate products not included elsewhere. "Other" includes wine; essential oils; sugar and tropical products; nursery and greenhouse products; beverages except juice; coffee; tea; cocoa; oilseeds (mostly rapeseed and safflower seed) meals and their oils; vegetable waxes, protein substances; chocolate; spices; rubber; fibers other than cotton; and horticultural products, such as starches, soy sauce, condiments, soups, gelatins, yeast, baking powder, food preparations, vinegar and hops.
State export estimates are based on the reported State-level production of commodities. More detailed data than appears in the online dataset are not available. In many cases, the sum of State production volumes is less than the reported U.S. total. This difference is then put in an "Other States" category for each commodity group.
ERS intends to discontinue updates of the production-based State agricultural export estimates. Future updates will include only the new calendar year, U.S. farm receipts-based series.
Advantages and Weaknesses of the Methodology Based on Cash Receipts
The new agricultural cash receipts-based method for estimating State export shares has several advantages over the production-based system it replaces:
- Using farm cash receipts accounts for differences in quality and price of commodities produced in each State. Information on price per unit in each State is used in computing cash receipts.
- Using farm cash receipts also accounts for changing farm and export prices of farm commodities across years.
- Using farm cash receipts allows use of information on commodities actually sold by farms rather than retained for on-farm use. On-farm use, farm-owned stocks, and Commodity Credit Corporation purchases are not included in farm cash receipts.
- Calendar year export value data are combined with consistent calendar year farm cash receipts data. Using a production-based approach requires mixing marketing year production data with Fiscal Year export data.
The cash receipts-based methodology, however, shares several weaknesses with a production-based approach for allocating exports to States.
- Neither approach tracks actual movement of farm products from States to ports or border crossings. Export estimates based on either cash receipts or production share may differ substantially from actual movements from States to export positions.
- Neither approach accounts for the role of States in processing or other value addition to exported products between the farm and export positions. The export value of processed foods and agricultural products is apportioned to States based on where the raw commodity is produced, not where the products were processed. Data on value added by commodity are not available by State. Export values (f.a.s., or "free alongside ship") also include costs for inland freight, insurance, and other charges incurred in delivering the commodity to the U.S. port of exportation not attributable to the farm production of the commodity.
- Neither approach accounts for the fact that U.S. export values include re-exports that only pass through U.S. ports; the value of re-exports is shared between States even though those products were not produced in the United States.
- Neither methodology can provide information on the countries of destination for each State's exports.
Comparison of Production-based and Cash Receipts-based State Export Estimates
As in exports estimated from production volumes, exports based on values show similar States in the top rankings. The charts below show, ranked by export earnings in 2010, the top 8 States are California, Iowa, Illinois, Texas, Minnesota, Nebraska, Indiana, and Kansas. These States exported from $14.9 to $4.3 billion worth of agricultural commodities and processed products in 2010. For animal products, the largest exporters are Iowa, Texas, California, Nebraska, and North Carolina, with earnings ranging between $2 and $1.2 billion in 2010. The top producers of plant products include California, Iowa, Illinois, Texas, Minnesota, and Nebraska, whose exports range from $12.7 to $5 billion in 2010. Most of these States produce the largest agricultural exports, including grains, oilseeds, feeds, meats, fruits, dairy and poultry products. Overall, U.S. exports of plant (crop) products are about 4 times more than animal products, which confer an advantage to large grain and oilseed producing States.
Many of these top producer States' exports exceed what their share of farm receipts indicate. That is, about 20 States produce highly exportable commodities resulting in their total export estimates being larger than the value obtained from multiplying the corresponding ratio of farm receipts by U.S. agricultural exports. In part, the reason for this is that value added from processing is not attributed to States that processed those exported products, but to the States that originally produced the primary raw materials of those exports. Thus, States that produce much of the exported commodities, measured as shares of farm receipts, are thus credited with proportionally higher export values. On this point, the production-based and receipts-based methods are compatible.
Farm cash receipts are calculated by multiplying farm production by unit price. As such, farm receipts-based exports use the information from commodity prices that production-based exports do not (see table ). An example of how using farm sales receipts reflect the effect of commodity prices on export estimates is the case of rice production in Arkansas and California. Although Arkansas produces and exports more than twice as much rice as California according to the production-based column in the table below, higher unit prices of California rice raise its export value relative to Arkansas' as seen in the receipts-based column. The export estimate for California rice based on farm receipts is $695 million in 2010, which is 73 percent of Arkansas' rice export estimate. Thus, different prices between States for the same commodity, as illustrated by the price premium of California rice, will result in different export estimates if based on farm receipts. When 2 States produce equal quantities of a commodity, the production-based export estimates will be the same, but will differ if their farm receipts reflect those price differences.
In the situation when two States have equal farm receipts ratios, as between Indiana and North Carolina in 2010, their exports estimates based on those ratios will depend on what highly exportable commodities they produce (see table ). In this case, even though Indiana and North Carolina have the same 3.1-percent share of total U.S. farm cash receipts, Indiana's larger production of grain and oilseed products relative to North Carolina, results in a larger difference in exports estimates than what production-based exports indicate. The results shows that the difference between export estimates based on farm receipts is almost twice as much as that based on production volume. That is, exports estimated from production volume share tend to underestimate export values. By contrast, exports based on farm receipts are more favorable toward States from which high-value exports originate, or toward States whose farm production is disproportionately represented in U.S. exports.
Comparing Census Bureau and ERS Production Share or Cash Receipts Estimates
The U.S. Census Bureau also estimates State-level exports for products using a method that is based on the last recorded point or location before transport to the port of exportation. This "origin of movement" can include either farms, silos, packers, factories, or warehouses. State export estimates using the Census Bureau's Origin of Movement (OM) methodology differ from those generated by the ERS production share (PS) or cash receipts (CR) methods (see table ). The key difference is that OM estimates are developed with business/manufacturing as the focus, while the PS and CR estimates are developed with agricultural production as the focus. For agricultural commodities that are traditionally exported in a less-processed form, the PS or CR estimates will lead to a larger value for States where production occurs. For commodities that are traditionally exported in a more highly-processed form, the OM estimates will lead to a larger value in those States where manufacturing or shipping occurs.
The differences are especially large for soybeans and feed grains. In the OM series, Louisiana and Washington account for 77 percent of soybean export value. Neither of these States is in the top 10 States in the PS/CR series. For the PS series, the top six states account for 79 percent of soybean export value; while Iowa, the leading PS state, and Indiana are not in the top 10 OM States. For feed grains, Louisiana accounts for 56 percent of the OM export value while not appearing in the top 10 PS States. Iowa, Illinois, and Nebraska account for 54 percent of PS feed grain export value. In the CR rankings for soybeans, the top 7 states sold 66 percent of total soybean exports, which also exclude Louisiana or Washington.
However, both the OM and PS/CR series list California, Washington, and Florida as the top three states for fruit and nut exports, with these States accounting for the majority of the estimated values of fruit and nut exports. Together, California, Washington, and Florida account for 81 percent of the estimated value of fruit and nut exports using the OM methodology and for 87 percent of the estimated value of fruit and nut exports using the PS method. These 3 states ship 79 percent of U.S. fruit exports using cash receipts-based shares. While there is not a lot of processing for these commodities, they are climatically suited to these areas and substantial amounts are shipped fresh.
The bias generated by origin of movement as opposed to origin of production or cash receipts in overestimating exports of port or border States is addressed as well. Origin of movement has many limitations as a substitute for origin of production for many farm commodities and processed products, making it an inaccurate basis for estimating State exports.
ERS farm cash receipts by State and commodity are calculated from NASS production estimates and unit prices of farm commodities in each State:
U.S. agricultural export values are obtained from the USDA Foreign Agricultural Service's Global Agricultural Trade System (GATS):
Farm production data by State are published by USDA's National Agricultural Statistics Service (NASS):