U.S. Agricultural Trade at a Glance

The United States is the world’s second largest agricultural trader after the European Union. Both U.S. agricultural exports and imports increased significantly over the last quarter century due to the economic ascension of many emerging economies, as well as the implementation of policies (both foreign and domestic) that have expanded U.S. access to foreign markets. Over the same period, the geographic and product composition of U.S. agricultural trade has shifted, as rising incomes and growing supply capacity of emerging economies have reshaped global supply and demand for agricultural and food products (See publication below.).

The Global Landscape of Agricultural Trade, 1995-2014

Composition and Destinations of U.S. Agricultural Exports Have Shifted

With U.S. agricultural output growing faster than domestic demand for many products, U.S. farmers and agricultural firms have been relying on export markets to sustain prices and revenues. As a result, U.S. agricultural exports have grown steadily over the past quarter century, reaching $136.7 billion in 2019, up from $46.1 billion in 1994.

However, the product composition of agricultural exports shifted at roughly the same time, reflecting changes in global supply and demand. Most notably, exports of consumer-oriented products—including high-value products (HVP) such as dairy products, meats, fruit, and vegetables—showed strong growth driven by increasing population and income worldwide and growing diversification of diets (See Figure 1.).

Destinations for U.S. agricultural exports have also shifted over the last 25 years. The elimination of agricultural trade barriers as a result of the North American Free Trade Agreement (NAFTA)—superseded by the United States-Mexico-Canada Agreement (USMCA) in July 2020—nearly quadrupled exports (by value) to Canada and Mexico (For more information on U.S. trade with Canada and Mexico, see USMCA). Coinciding with policy developments, rising household incomes and changing trade policies in developing East and Southeast Asia have driven export growth, especially for China, whose share of U.S. agricultural exports more than quadrupled from 3 percent during 1994–2000 to 14 percent during 2010–19. Meanwhile, there has been a sharp decline in the share going to Europe and high-income East Asia, particularly Japan (For data on U.S. agricultural destinations, see Foreign Agricultural Trade of the United States.).

Share of Exports in U.S. Agricultural and Food Production Has Remained Steady Since 2008

The share of U.S. agricultural and food production sold outside the country indicates the level of these sectors’ dependence on foreign markets, as well as the size of the overall market for U.S. agricultural products. Since 2008, the share of U.S. agricultural and food production (in terms of value) sold in international markets has remained fairly steady at approximately 20 percent. Among the many products that make up agricultural trade, the Economic Research Service (ERS) estimates that, on average, 22 percent of the output of nonmanufactured products and 21 percent of manufactured products were exported between 2008 and 2018 (See Figure 5.).

In 2018, Agricultural Exports Required About 1 Million Full-time Civilian Jobs

U.S. agricultural exports support output, employment, income, and purchasing power in both the farm and nonfarm sectors. ERS estimates that, in 2018, each dollar of agricultural exports stimulated another $1.17 in business activity. The $139.6 billion of agricultural exports in calendar year 2018 produced an additional $162.9 billion in economic activity for a total economic output of $302.5 billion. Every $1 billion of U.S. agricultural exports in 2018 required approximately 7,500 American jobs throughout the economy. Agricultural exports in 2018 required 1,048,000 full-time civilian jobs, which included 691,000 jobs in the nonfarm sector (See Figure 6.).

The Agricultural Trade Multipliers data are available here.

U.S. Agricultural Imports Expanded Steadily, Mostly Driven by Consumer-oriented Products

U.S. agricultural imports also expanded steadily over the past quarter century, largely driven by growing domestic demand for an array of consumer-oriented products. Between 1994 and 2019, total agricultural imports more than tripled in value, reaching $129 billion, up from a low of $27 billion in 2000.

Consumer-oriented products have dominated U.S. agricultural imports and have grown faster than total agricultural product imports, increasing on average by more than 7 percent annually since 1994. Increasing demand for year-round variety in foods has driven imports of horticultural products during the offseason in U.S. production. Horticultural products accounted for more than half of U.S. agricultural imports in 2019. Sugar and tropical products, such as coffee, cocoa, and rubber, accounted for approximately 17 percent of imports (See Figure 7.).

Of the current largest 20 agricultural suppliers, the fastest growing sources of U.S. consumer-oriented imports since 1994 are Vietnam (cashews, pepper), Peru (fresh fruits), India (pepper and sesame seed, vegetable extracts), Switzerland (carbonated soft drinks), and Singapore (tropical and essential oils).

Data on U.S. Imports by Level of Processing are available. See the U.S Agricultural Trade Update.

Share of Imports in Consumption Has Increased in Recent Years

As the U.S. population has grown in size and diversity, the volume and variety of food consumed domestically have also increased, driving up imports of a range of agricultural products. Over the past decade, the share of imports in overall food and beverage consumption has trended upward, from 11.7 percent in 2009 to 16.6 percent in 2018. Import shares (based on value) have been higher for manufactured products than for nonmanufactured products, due in part to higher unit prices for manufactured imports. Manufactured products drove the rise in import share of consumption growth between 2008 and 2012. But, since 2013, nonmanufactured products such as food grains and horticultural goods have driven increases in the share of imports in food consumption (See Figure 9.).

For data set, please see Import Share of Consumption (2008-2018).

 

Last updated: Thursday, July 23, 2020

For more information, contact: Adam Gerval