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U.S. exports of whole soybeans are forecast to grow in 2018/19

Monday, May 21, 2018

The United States is a leading global producer and exporter of soybeans. Oilseed and oilseed product exports, particularly soybeans, represent a significant source of demand for U.S. producers and make a large net contribution to the U.S. agricultural trade balance. In the 2018/19 marketing year (September–August), total U.S. exports of soybeans (whole, meal, and oil) are expected to increase by over 8 percent provided normal trade relations with other countries, which if realized, would mark a return to growth after a modest contraction expected for 2017/18. (Exports had increased in the previous 5 marketing years.) Whole soybean exports, which are expected to increase 11 percent in 2018/19 over 2017/18, are responsible for the increased forecast in total soybean exports in 2018/19. Relatively small declines are expected in 2018/19 over 2017/18 in exports of soybean meal and oil—the principal components of crushed soybeans. Although soybean exports from the United States have grown over the past 25 years, the share of U.S. exports in global oilseeds trade has declined. Significant expansion in soybean output by countries like Brazil and Argentina have reduced the U.S. shares of global exports and production. Brazil surpassed the United States as the world’s leading exporter of soybeans in 2011/12 and is expected to exceed U.S. production for the first time in 2018/19. This chart is drawn from data discussed in the ERS Oil Crops Outlook released in May 2018.

A hypothetical increase in U.S. agricultural exports is estimated to add rural jobs across different agri-food sectors

Friday, May 18, 2018

ERS estimates that U.S. agricultural exports, totaling about $135 billion in 2016, supported about 1.1 million full-time, civilian jobs. Using a model of the U.S. economy with a base year of 2013, ERS researchers found that a hypothetical 10-percent increase in foreign demand for U.S. agricultural exports would add about 41,500 jobs, or about a 0.03-percent increase in total U.S. employment. About 42 percent would be in rural areas—where employment in agriculture and food manufacturing would increase by about 18,200 jobs, while employment in other sectors would decrease by nearly 700 jobs as some labor shifts into agriculture. The net effect on employment was positive for 17 of the 20 agri-food sectors in the analysis, with the largest increases in field crops, livestock, and poultry and egg. This reflects the large initial shares of exports and employment in these sectors, relative to other agri-food sectors. Field crops alone accounted for nearly 57 percent of the increase in agri-food rural employment. This chart is based on data that appears in the April 2017 ERS report The Potential Effects of Increased Demand for U.S. Agricultural Exports on Metro and Nonmetro Employment.

Recent food price inflation in line with overall inflation

Thursday, May 17, 2018

From 2013 to 2017, the Consumer Price Index (CPI) for all food (grocery store and restaurant food) rose by 5.5 percent. This increase was relatively in line with the 5.2-percent rise in the all-items CPI, indicating that food prices were rising only moderately faster than prices for consumer goods and services as a whole. Over the last couple years, rising restaurant prices have contributed to food price inflation outpacing prices for recreation, education and communication, apparel, and transportation. Apparel and transportation prices actually declined from 2013 to 2017. Medical care and housing were the only two major consumer spending categories whose prices rose faster than food prices during this time period. Food-price inflation outpacing economy-wide inflation is not a recent phenomenon. Over the last decade, food-price inflation averaged 2.1 percent per year and overall inflation averaged 1.7 percent per year. Price inflation for food at home, however, averaged 1.8 percent per year during 2013-17, in line with economy-wide inflation. This chart appears in ERS’s data product, Ag and Food Statistics: Charting the Essentials.

Monthly U.S. dried garlic trade spiked temporarily in 2016/17

Wednesday, May 16, 2018

In late 2016 to early 2017, the amount of dried garlic imported to and exported from the United States rose above historical levels. The spike in U.S. garlic trade was precipitated by events in China, the world’s largest producer of garlic. Relatively low supply and high fresh garlic prices in 2016 incentivized Chinese farmers to increase production in 2017, ultimately leading to excess supply and a decline in global fresh garlic prices. This oversupply also impacted the market for dried garlic, viewed as a high value-added outlet for fresh garlic, and international prices for dried garlic fell as well. U.S. imports began to climb around May 2016 and peaked in January 2017 at approximately 98 million pounds. Before and during this period, China accounted for over 95 percent of all dried garlic imported into the United States. U.S. exports of dried garlic also rose during this period. Much of the growth in U.S. dried garlic shipments was to markets such as Peru, India, Portugal, and Greece, where U.S. exports were previously limited due to typically high competition from China. As global prices rose back to normal levels by mid-2017, U.S. dried garlic trade returned to historical levels. This chart appears in the ERS Vegetables and Pulses Outlook newsletter released in April 2018.

Agriculture and its related industries added over $1 trillion to U.S. GDP in 2016

Tuesday, May 15, 2018

Agriculture, food, and related industries contributed 1.05 trillion to U.S. gross domestic product (GDP) in 2016, a 5.7-percent share. The output of America’s farms contributed $136.7 billion of this sum—about 1 percent of GDP. The overall contribution of the agriculture sector to GDP is larger than this because sectors related to agriculture—forestry, fishing, and related activities; food, beverages, and tobacco products; textiles, apparel, and leather products; food and beverage stores; and food service, eating and drinking places—rely on agricultural inputs in order to contribute added value to the economy. The value added by America’s farms has decreased in each of the last 3 years, from a high of $187.0 billion in 2013. The decline in value added is primarily driven by lower commodity prices for major crops like corn and soy, which were near record highs in 2013. All other agriculture related industries included grew in 2016 relative to a year earlier. The largest growth occurred in the food service, eating and drinking places industries, with 6 percent more value added in 2016 than in the previous year. This chart is updated for 2016 and is from ERS's data product, Ag and Food Statistics: Charting the Essentials.

Close to 90 percent of U.S. consumers’ food and beverage spending is for domestically produced products

Monday, May 14, 2018

In 2016, 87.3 percent of food and beverage purchases by U.S. consumers, including both grocery store and eating out purchases, were from domestic production. The remaining 12.7 percent were imported food and beverages such as produce from Chile or wines from France. Imports’ share of the U.S. food and beverage dollar has almost doubled over the last two decades from 6.9 percent in 1993, due in part to growing demand by U.S. consumers for year-round fresh produce options and increasing global trade in food and beverages. Imported inputs are used in U.S. food and beverage production, and their share of the U.S. food and beverage dollar has also risen. Imported inputs used by U.S. food companies and restaurants include both food inputs, such as avocadoes from Mexico and cranberries from Canada, and non-food inputs such as natural gas and foreign-made restaurant equipment. In 2016, imported inputs used in domestically produced food and beverages accounted for 4.7 percent of the U.S. food and beverage dollar, up from 3.7 percent in 1993. The data for this chart are from ERS’s Food Dollar Series data product.

U.S. fresh blueberry demand continues to increase

Friday, May 11, 2018

Per capita U.S. fresh blueberry use has increased to record-breaking levels each year since 2006, reaching 1.79 pounds in 2017. Rising U.S. demand over the last two decades has been supported by increased availability from domestic production and imports. Imports, however, have risen more rapidly than domestic production, climbing to a record 328.3 million pounds in 2016—exceeding domestic production for the first time over the period 1980-2017. Imports’ share of domestic use rose from about 25 percent in the 1980s to over 50 percent in recent years. More than half of total import volume come from Chile; other key suppliers include Canada, Mexico, Peru, and Argentina. Being sourced mainly from the Southern Hemisphere, a majority of the imports occur during the off-season for domestic production. The U.S. production season begins in April and runs through the summer into early fall. This chart appears in the bi-annual ERS Fruit and Tree Nuts Outlook newsletter released in March 2018.

Midpoint acreage more than doubled for all five major field crops

Thursday, May 10, 2018

Over the last three decades, the midpoint acreage—where half of acres are on farms that harvest more than the midpoint, and half are on farms that harvest less—has shifted to larger farms for almost all crops. In 1987, for example, the midpoint for corn was 200 acres, which increased to 600 acres by 2012. Four other major field crops (cotton, rice, soybeans, and wheat) showed a very similar pattern: the midpoint for harvested acreage more than doubled for each crop between 1987 and 2012. The midpoints also increased persistently in each census year, with the single exception of a decline in cotton in 2012. ERS researchers repeated the analysis for a total of 55 crops in all. Consolidation was nearly ubiquitous, as the midpoint increased in 53 of 55 major field and specialty crops between 1987 and 2012. Consolidation was also substantial, as most of these midpoint increases were well over 100 percent—and it was persistent, as most midpoints increased in most census years. This chart appears in the ERS report Three Decades of Consolidation in U.S. Agriculture, released March 2018.

Nutrition scores for Americans’ food acquisitions vary by source

Wednesday, May 9, 2018

Using data from USDA’s National Household Food Acquisition and Purchase Survey (FoodAPS), ERS researchers calculated nutrition scores for foods purchased or acquired for free by three groups: participants in USDA’s Supplemental Nutrition Assistance Program (SNAP), low-income non-SNAP households, and higher income non-SNAP households. For the scores, the researchers used the Healthy Eating Index-2010, which is a measure of dietary quality that assesses conformance to the 2010 Dietary Guidelines for Americans. Scores run from 0 to 100 and summarize how well the week’s foods compare to Federal dietary recommendations—a higher score reflects a healthier diet. Foods acquired at large grocery stores were more nutritious than foods from smaller stores or from restaurants and other eating places. However, grocery store purchases by SNAP households scored 4 and 8 points below purchases by low-income and higher income non-SNAP households, respectively. For SNAP households, school food rivaled large grocery stores for nutritional quality. This is likely because meals served as part of USDA’s school lunch and breakfast programs must meet Federal nutrition standards. SNAP participants are eligible for free or reduced-price school meals and likely rely more on these meals and less on snacks and other items sold in schools that are not required to meet the same nutrition standards as USDA school meals. A version of this chart appears in the February 2018 Amber Waves article, "Supermarkets, Schools, and Social Gatherings: Where Supplemental Nutrition Assistance Program and Other U.S. Households Acquire Their Foods Correlates With Nutritional Quality."

Average employment grew more rapidly for Value-Added Producer Grant recipients after receiving the grants

Tuesday, May 8, 2018

USDA’s Value-Added Producer Grant (VAPG) program provides grants intended to help farmers and ranchers add greater value to agricultural commodities, such as through additional processing or marketing of new products. For example, producers could adopt organic practices, turn berries into jam, or process meat into sausage. Between 2001 and 2015, the program provided a total of 2,345 grants to farmers and ranchers—totaling $318 million, or about $136,000 per grant on average. ERS researchers investigated the effect of the VAPG program on job creation by comparing employment trends pre- and post-grant for VAPG recipients and similar non-recipients. No significant difference in average employment levels was found between the two groups before the grants were received. However, average employment grew more rapidly for VAPG recipients than non-recipients after receipt of the VAPGs. The researchers found that grant recipients employed five to six more workers on average than non-recipients 1 to 5 years after the grant was received. However, given a 95-percent confidence interval, these job growth numbers can vary between about 2 to 10 jobs. At the time of the grants, these businesses employed around 14 employees on average. This chart appears in the May 2018 ERS report Impacts of USDA’s Value-Added Producer Grant Program and Its Effect on Business Survival and Growth.

Rapid growth in China’s agricultural imports paralleled its foreign exchange reserves

Monday, May 7, 2018

Since China officially joined the World Trade Organization in December, 2001, its role within the global economy has expanded. In addition to its rising role as an agricultural exporter, China’s growing economy has created more demand for food than can be satisfied domestically. As a result, the country has taken a more global approach through trade and foreign investment. China’s outward agricultural investment coincided with several related economic trends, including rapid growth in agricultural imports and foreign exchange reserves. The first prominent official endorsements of “going global” in agriculture appeared during 2007-08, as the value of China’s agricultural imports surged during those years. After a brief dip during the global financial crisis, China’s agricultural import growth accelerated from 2009 to 2013. The growing agricultural trade deficit prompted greater concern among Chinese officials about national food security. China’s foreign exchange reserves also grew rapidly during those years, peaking at $4 trillion in 2014. These reserves provided financial resources to support outward investment. However, foreign investment flows continued to accelerate after foreign exchange reserves and agricultural imports declined during 2014-16. This chart appears in the ERS report, China's Foreign Agriculture Investments, released in April 2018.

Conservation program spending levels off but continues shift to Working Land Programs

Friday, May 4, 2018

USDA agricultural conservation programs provide technical and financial assistance to farmers who adopt and maintain practices that conserve resources or enhance environmental quality. Although USDA implements more than a dozen individual conservation programs, nearly all assistance is channeled through six: the Conservation Reserve Program (CRP), Environmental Quality Incentives Program (EQIP), Conservation Stewardship Program (CSP), Conservation Technical Assistance (CTA), Agricultural Conservation Easement Program (ACEP), and the Resource Conservation Partnership Program (RCPP). EQIP, CSP, and CTA are often referred to as “Working Land Programs” because they focus primarily on supporting conservation on land in agricultural production (crops or grazing). The 2014 Farm Act continued to emphasize working land conservation. Between 2012 and 2017, combined funding for Working Land Programs accounted for more than 50 percent of spending in USDA conservation programs. This emphasis reflects a long-term trend—begun under the 2002 Farm Act—that increased annual spending in Working Land Programs. In 2017 dollars (to adjust for inflation), this spending increased from roughly $1 billion under the 1996 Farm Act to more than $3 billion under the 2014 Act. This chart updates data found in the May 2014 Amber Waves feature, "2014 Farm Act Continues Most Previous Trends In Conservation."

Economic conditions and program policy help drive average SNAP benefit levels

Thursday, May 3, 2018

USDA’s Supplemental Nutrition Assistance Program (SNAP) provides low-income households with monthly benefits to supplement their resources for purchasing food. Benefit amounts increase with household size and decrease with household income. Between 1980 and 2017, average monthly benefits grew from $34 per person to $126 per person. Much of this increase reflects the fact that SNAP benefit levels are updated annually for food price inflation so that their purchasing power does not erode. However, even when benefits are adjusted for inflation, average per person benefits rise and fall as characteristics of SNAP households, such as income, change in response to economic conditions and policy changes. Measured in 2017 dollars to adjust for inflation, average monthly SNAP benefits increased from $99 per person in 1980 to $119 in 2008. The 2009 American Recovery and Reinvestment Act (ARRA) provided all recipients with increased SNAP benefits, and average inflation-adjusted SNAP benefits jumped to $143 per person in that year, climbed to $152 in 2010, and then began falling as the ARRA increase was phased out and economic conditions improved. Inflation-adjusted and nominal benefit amounts have been similar in the past few years, as food price increases have been small. This chart appears in ERS’s Supplemental Nutrition Assistance Program (SNAP) topic page.

More than half of China’s foreign agricultural investment is within Asia, but the focus has become more global

Wednesday, May 2, 2018

Chinese foreign agricultural investment has grown exponentially since 2009. Initial investment growth was primarily aimed at expanding access to crop production, fishing ventures, and raw materials. Most such ventures targeted eastern Russia and neighboring Asian countries, attracted by relatively cheap, underutilized land. Chinese investments in Southeast Asia have focused on tropical crops like palm oil, cassava, sugar, fruit, and lumber, prompted by strong domestic demand and a regional free trade agreement with the Association of South East Asian Nations (ASEAN). Asia accounts for about half of China’s foreign investment in agriculture, forestry, and fishing. More recently, the strategy has moved toward acquiring established agribusiness companies around the world in regions like Europe, Oceania, Africa, and the Americas. Investment in North America, though, was limited to just 2 percent of reported foreign agricultural investment in 2014. This chart appears in the April 2018 Amber Waves feature, "China’s Agricultural Investment Abroad Is Rising."

Productivity has replaced resource intensification as the primary source of growth in global agriculture output

Tuesday, May 1, 2018

Since the 1990s, productivity growth has driven the growth in global agricultural output of total crop and livestock commodities, helping to make food more abundant and cheaper worldwide. Global output growth initially slowed in the 1970s and 1980s, but then accelerated in the 1990s and 2000s. In the latest period (2001-14), global output of total crop and livestock commodities expanded at an average rate of 2.5 percent per year. In the decades prior to 1990, most output growth came about from intensification of input use, such as using more labor, capital, and material inputs per acre of agricultural land. Bringing new land into agricultural production and extending irrigation to existing agricultural land were also important sources of growth. Over the last two decades, however, the rate of growth in agricultural resources (land, labor, capital, etc.) has significantly slowed. By comparison, improvements in total factor productivity have increased, accounting for about two-thirds of global output growth during 2001-14. TFP growth reflects the use of new technology, efficiency improvement, and changes in management by agricultural producers around the world. This chart appears in the ERS topic page for International Agricultural Productivity, updated October 2017.

Distance to grocery stores and vehicle access affect low-income shoppers’ food spending

Monday, April 30, 2018

Difficulty accessing large grocery stores may increase a household’s reliance on smaller stores and restaurants, possibly resulting in a diet of low-nutritional quality and related health problems. ERS researchers used data captured in USDA’s National Household Food Acquisition and Purchase Survey (FoodAPS) to examine if differences in how far low-income households live from large grocery stores and whether they own a car influences their food spending behaviors. Among low-income households, the researchers found that access-burdened and sufficient-access households spent similar shares of their weekly food spending at grocery stores (57-58 percent) and at small grocery, ethnic, and specialty food stores (3-5 percent). Differences between the two low-income access groups did arise in spending at convenience, dollar, drug, and other small stores and at eating places. Access-burdened households spent a higher share of their food expenditures at convenience, dollar, drug, and other small stores than sufficient-access households and a smaller share of their food budgets at eating places. In 2012, 26.4 percent of U.S. households were low-income sufficient-access households and 4.7 percent were low-income access-burdened. This chart is from "Distance to Grocery Stores and Vehicle Access Influence Food Spending by Low-Income Households at Convenience Stores," in the March 2018 issue of ERS’s Amber Waves magazine.

World cotton stocks are projected to rise slightly in 2017/18

Friday, April 27, 2018

Global cotton ending stocks serve as an important benchmark and help determine worldwide cotton prices. Global cotton ending stocks are projected to increase slightly in the 2017/18 marketing year. Global ending stocks are forecast at over 88 million bales, about 2 percent above the previous season—but the second lowest since 2011/12. The rise in stocks follows back-to-back decreases over the last two marketing years. The largest holder of cotton stocks is China, which accounts for nearly 50 percent of the world total. China’s share has fluctuated in recent years, from 20 percent in 2010/11 to a high of 61 percent in 2014/15 and back down to 46 percent in the current season. Since 2014/15, China’s stocks have declined as policies to reduce the excess cotton supplies also discouraged production and limited imports. Meanwhile, stocks in the United States and for the rest of the world are projected to increase in 2017/18, largely due to increased production brought about by relative prices that favor cotton over competing crops such as corn and soybeans. This chart appears in the ERS Cotton and Wool Outlook newsletter released in April 2018.

Small family farms accounted for half the farmland, but only 23 percent of production

Thursday, April 26, 2018

In 2016, 99 percent of U.S. farms were family farms, where the principal operator and his or her relatives owned the majority of the business. Small family farms—those with less than $350,000 in annual gross cash farm income (GCFI)—accounted for about 90 percent of U.S. farms, half of all farmland, and a quarter of the value of production. By comparison, large-scale family farms—those with $1 million or more in GCFI—made up only 3 percent of U.S. farms and 18 percent of farmland, but contributed 45 percent of production. Nonfamily farms, such as partnerships of unrelated partners and corporations, accounted for just 1 percent of U.S. farms and 10 percent of production. The 19 percent of nonfamily farms with GCFI of $1 million or more accounted for 88 percent of all nonfamily farms’ production. This chart appears in the ERS report America’s Diverse Family Farms: 2017 Edition, released December 2017.

China’s direct overseas agricultural investment has grown over tenfold in less than a decade

Wednesday, April 25, 2018

China's need for agricultural resources and technology and the country's sustained economic growth are driving rapid growth in Chinese investment in agriculture and food sectors abroad. According to Chinese investment statistics, overseas ventures in agriculture, forestry, and fisheries soared from $300 million in 2009 to $3.3 billion in 2016. But these totals understate the magnitude of Chinese agricultural-focused foreign assets because the statistics exclude the acquisition of food processing and trading companies classified in manufacturing and service sectors. An initial wave of investments during 2004-12 was focused mainly on crop production, fishing ventures, and acquiring raw materials for the Chinese market. More recently, some Chinese companies and officials have shifted the thrust of their strategy from farming overseas to acquiring established agribusiness companies based in Europe, North America, and Oceania such as ChemChina's acquisition of Syngenta and Shuanghui International's purchase of U.S.-based Smithfield Foods. This chart appears in the April 2018 Amber Waves feature, "China's Agricultural Investment Abroad Is Rising."

Retail price changes for most food categories were small in 2017

Tuesday, April 24, 2018

With the exception of eggs, 2017 was a year of relative stability for grocery store prices. Lower agricultural commodity prices and a relatively strong U.S. dollar (which can make imported foods less expensive) contributed to smaller than average price increases and, for some foods, price decreases. The largest increase was for fish and seafood prices, which rose 1.2 percent—still well below the category’s 20-year historical average of 2.5 percent per year. Beef and veal prices fell 1.2 percent, cereals and bakery products were down 0.5 percent, and retail prices for sugars and sweets and fresh vegetables both fell by 0.1 percent in 2017. The food category with the largest price change in 2017 was eggs—a category prone to yearly price swings. Retail egg prices fell 9.5 percent in 2017, as egg production continued to recover from lows in 2015 due to the Highly Pathogenic Avian Influenza. Eggs account for 1.3 percent of food-at-home spending, so their large price swings have muted effects on overall grocery store inflation. This chart appears in an ERS data visualization, Food Price Environment: Interactive Visualization, released February 2018.

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