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February 24, 2022

First Quarter Report Highlights: The 2022 U.S. Agriculture Trade Outlook 

Strong global demand is leading to a record-breaking forecast for U.S. agriculture export and import outlooks are anticipating record-breaking highs with increases in nearly all major U.S. agriculture commodities.

Economic recovery is evident from the USDA’s first quarter trade forecast for 2022. Both U.S. ag export and import outlooks are anticipating record-breaking highs with increases in nearly all major U.S. ag commodities. 

Keep reading to find key takeaways and highlights from this first quarter USDA trade outlook report for 2022.  

Report Highlights: Outlook for U.S. Agricultural Trade in 2022 

The U.S. ag export forecast for fiscal year (FY) 2022 rose to $183.5 billion—an $8 billion increase from the USDA trade outlook report released November 2021.  

U.S. ag imports in FY 2022 are also forecasted to hit record highs totaling $172.5 billion. According to the USDA trade report, the surge in U.S. ag trade volume is attributed to strong growth in world real domestic product (GDP). While supply chain constraints, energy prices, monetary policy, and a tight labor market have led to a slight decline from the previous forecast, world GDP is still projected to increase by 4.4 percent.  

It’s important to note that the impacts of the Ukraine-Russia conflict were not taken into account in this first quarter report and will likely be a contributing variable in outlook shifts in the next USDA trade report scheduled to release in May 2022.  

Commodity Deep Dives 

Strong economic recovery, combined with geopolitical tensions and lower production rates in other countries, have led to substantial increases in projected cash receipts across a majority of U.S. ag commodities. 

  • Oilseed and products (+12%): Leading the surge in the 2022 trade outlook, oilseed and related products are forecasted 12 percent higher than the November forecast at a record $43.6 billion. 
  • Soybean and soybean meal (+10%): Export forecast is up 10 percent to $31.1 billion, due mostly to lower global supply combined with higher market prices. Adverse weather in South America that is reducing global supply is more than offsetting lower demand from major buyers like China.  
  • Cotton (+10%): Global and domestic cotton prices have surged to 11-year highs, leading to a nearly 10 percent increase in U.S. cotton export outlook since the last trade report.  
  • Grain and feed (+3%): Exports are up a modest three percent to $42.9 billion since the November trade report but could be pushed further with supply disruptions in both Ukraine and Russia, who collectively account for more than a quarter of global wheat production.  
  • Horticultural product (+2%): Export forecast increased two percent to a record $38.5 billion, driven mostly by record projections for U.S. tree nuts in 2022. 
  • Livestock, dairy, and pork products (+1%): Export forecast increased by only one percent from the November trade forecast due to gains in U.S. beef and dairy product exports but a slight decline in U.S. pork exports.  
  • Corn (-.6%): Lower volume more than offset higher unit values and led to a slight decline in the U.S. corn export forecast.  

Trade Partnerships 

Despite falling short of commitments in the Phase One trade agreement, China remains the largest U.S. agricultural market at an unchanged 2022 ag export prediction of $36 billion in 2022.  

Mexico, Japan, and Canada accounted for the largest increase in trade outlook—up 15 percent, nine percent, and eight percent respectively. 

Mexico is forecasted to overtake Canada as the second-largest U.S. agricultural trading partner at $27 billion in U.S. ag exports forecasted for 2022.  

Job Creation and Economic Activity 

One interesting aspect of the February ag trade report was an additional section that summarized the economic activity and job creation the U.S. ag sector provided in 2020.  

  • U.S. ag exports in 2020 supported more than 1.3 billion jobs and generated over $154 billion in additional economic activity. 
  • 39 percent of these jobs were in the farm sector, while the remaining 61 percent were jobs outside the farm gate. 
  • On average, each dollar of U.S. ag exports created an additional $1.03 in economic activity in 2020.  

We Let Nothing Stand in Your Way 

The first quarter trade outlook report for U.S. agriculture in 2022 brought promising news. However, recent events have taught us how quickly these outlooks can shift. It’s important for farmers, ranchers, and landowners to be tapped into both our domestic and global economies to make the most informed business decisions for their operation.  

Download AgAmerica’s annual economic report to dive deeper into the influential factors impacting the U.S. farm economy the most in 2022, with exclusive insights from Chief Economist Dr. John Penson.

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