US farm trade deficit reaches new heights

Nov 29, 2024
By Farms.com

USDA forecasts $45.5 billion trade deficit for agriculture in 2025

The USDA’s latest forecast reveals a record $45.5 billion trade deficit for US agriculture in fiscal year 2025. This figure exceeds the $42.5 billion estimate made in August.

Exports are expected to reach $170 billion, up slightly from earlier forecasts but significantly lower than their 2022 peak. Imports are predicted to rise to $215.5 billion, driven by increasing demand for tropical fruits, sugar, and other products.

Global price declines have significantly impacted farmers, particularly those reliant on crops like cotton and soybeans. Livestock, dairy, corn, and sorghum exports have grown, but not enough to offset other losses.

“As so goes the price of some of our key agricultural exports, so goes our total export value, and that also is a big contributor to farm income,” said USDA Chief Economist Seth Meyer.

Additionally, potential 25% tariffs on Canada and Mexico, two of the US’s largest agricultural trading partners, pose further risks. Exports to Mexico are expected to reach $29.9 billion, with Canada following closely at $29.2 billion.

The growing deficit underscores challenges in the agricultural sector, requiring innovative solutions to address global competition and rising import pressures. Farmers must navigate these hurdles to sustain their livelihoods.

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