# Presentation: 432240

## 2004 AgExport Forecast Raised to Record $62.0 BillionInitial 2005 AgExport Forecast Set at $57.5 BillionInitial 2005 AgTrade Surplus Set at $2.5 Billion  

**FY Export Forecasts for Agricultural,**
**Fishery & Solid Wood Products**

- USDA’s “Outlook for U.S. Agricultural Trade”
- will be released on August 26, 2004 at 4pm EST
- Prepared by Foreign Agricultural Service/USDA

## U.S. Agricultural Trade

**U.S. Agricultural Trade**

***Exports***

***Imports***

***Trade Balance   ***

- Total export value is lower in 2005 due largely to increased foreign competition and lower prices for cotton, wheat and soybeans.           Record imports drives trade surplus to lowest since 1972.

**57.5**

**55.0**

**2.5**

- Record

## Commodity Export Projections, 2005

|  | 
Final
FY 2003 | Aug
FY ‘04
For. | Aug
FY ‘05
Proj. | 
04/05
Chg | 

Main Reasons |
| --- | --- | --- | --- | --- | --- |
| Wheat & Flour ($ Bil) | 4.027 | 5.1 | 4.1 | -1.0 | (+) competition; (-) price |
| Soybeans & meal ($ Bil) | 7.640 | 8.4 | 7.6 | -0.8 | (+) vol; (-) price – SAmer crop |
| Cotton ($Bil) | 2.854 | 4.7 | 3.1 | -1.6 | (-) price/volume |
| Livstk Prods ($ Bil) | 9.062 | 7.2 | 6.8 | -0.4 | BSE bans continue |
|  |  |  |  |  |  |
| Wheat (mmt) | 24.296 | 31.0 | 25.0 | -6.0 | (+) Black Sea/EU competition |
| Soybeans & Meal (mmt) | 33.971 | 28.1 | 32.7 | +4.6 | (+) US crop; strong China demand |
| Cotton (mmt) | 2.514 | 3.1 | 2.7 | -0.4 | (+) competition; (-) China demand |

**Commodity Export Projections, 2005**

***Key Changes -- Fiscal ’04 to Fiscal ‘05***

- No country projections available until November 2004.

## Export Outlook for Grain & Feed Products

**Export Outlook for Grain & Feed Products**

- Revised FY 2004 Forecast:     $200 Million to $17.8 Billion
- Initial FY 2005 Projection:    $16.1 Billion

- Includes corn gluten feed/meal

- Revised FY 2004 Forecast
*Key Developments*
-  Vol gains for wheat & feeds partly offset by lower corn, sorghum, rice volumes
- Initial FY 2005 Projection
*Key Upside Developments*
-  Global grain stocks remain at 2nd lowest level in nearly 25 years
-  US corn exports up 4 mmt due to record US crop & lower China exports
*Key Downside Developments*
-  Weaker outlook due to lower wheat export vol and grain unit values; record world grain production pressures price
-  Increased Black Sea  & EU grain exports
*Wild Cards*
-  China’s import demand; crop sizes

## Export Outlook for Oilseeds & Products

**Export Outlook for Oilseeds & Products**

- Excludes corn gluten feed/meal

- Revised FY 2004 Forecast:   Unchanged at $10.9 Billion
- Initial FY 2005 Projection:   $9.9 Billion

- Revised FY 2004 Forecast
*Key Developments*
-  (+)Higher soybean unit price
-  (-)Lower China soybean demand
-  (-)Reduced US soybean export vol
- Initial FY 2005 Projection
*Key Upside Developments*
-  US soybean crop rebounds
-  Record China import demand
*Key Downside Developments*
-  Lower oilseed & product prices
-  Record SAmer soy crop/exports
*Wild Cards*
-  US & SAmer crop size; soy rust
-  China’s soybean imports

## Export Outlook for Cotton & Linters

**Export Outlook for Cotton & Linters**

- Note:  FY ’03 and prior years based on U.S Census data; FY ‘04 and ’05 forecasts based on WASDE MY forecast.

- Revised FY 2004 Forecast:      $500 Million to $4.7 Billion
- Initial FY 2005 Projection:   $3.1 Billion

- Revised FY 2004 Forecast
*Key Developments*
-  Mill use, particularly in China, continues strong; US export value to China raised due to stronger than expected sales at higher prices
- Initial FY 2005 Projection
*Key Developments*
-  Substantially larger crops (better prices/good weather) especially outside the United States push down US export value and volume
*Wild Cards*
-  US & foreign crop estimates could deteriorate
-  Demand could vary, particularly upward

## Export Outlook for Dairy, Livestock & Poultry

**Export Outlook for Dairy, Livestock & Poultry**

- Revised FY 2004 Forecast:     $100 Million to $10.7 Billion
- Initial FY 2005 Projection:   $10.4 Billion

- Revised FY 2004 Forecast
*Key Developments*
-  (+)Beef & pork raised $172 mil; record pork exports at 690,000 mt ($1.68 bil); animal fats up $70 mil; dairy prods up $55 mil
-  (-)Live animals lowered $100 mil -- lower horse exports expected
- Initial FY 2005 Projection
*Key Upside Developments*
-  Pork exports at record 710,000 tons ($1.7 billion)
*Key Downside Developments*
-  Beef & beef offals lowered $410 million based on absence of higher vol 1st qtr fiscal 2004 (pre-BSE) (forecast assumes import bans remain in place entire year)
*Wild Cards*
-  Timing of the lifting of BSE bans; reopening Japan & Korea beef markets could add up to $2 billion

## Export Outlook for Horticultural Products

**Export Outlook for Horticultural Products**

- Revised FY 2004 Forecast:   Unchanged at $13.4 Billion
- Initial FY 2005 Projection:   $13.8 Billion

- Revised FY 2004 Forecast
*Key Developments*
-  (+)Strong growth for first 9 months, led by tree nuts and highly- processed misc. products
-  (+)Strong exports to NAFTA partners, key Asian mkts & the EU
- Initial FY 2005 Projection
*Key Upside Developments*
-  Strong demand for most products; almonds set at record $1.1 billion
*Key Downside Developments*
-  Total value growth rate slows due to slower increase in prices
*Wild Cards*
-  U.S./foreign crops and prices; new SPS barriers

## Export Outlook for Fishery Products

**Export Outlook for Fishery Products**

***Forecasts are not official USDA estimates.***

- Revised FY 2004 Forecast:      $100 Million to $3.3 Billion
- Initial FY 2005 Projection:   $3.4 Billion

- Revised FY 2004 Forecast
*Key Developments*
-  (+) Sockeye salmon harvest up 39% over 2003 harvest
-  (+) Japanese technicians secure visas needed to maintain salmon roe exports valued at $120 million
- Initial FY 2005 Projection
*Key Upside Developments*
-  Steady demand for pollock, salmon, lobster, cod, crab and other fishery products
*Wild Cards*
-  Strength of the U.S. dollar
-  Size of U.S. and foreign fish and other seafood harvests

_***Trade Balance***_
**The annual trade deficit in fishery products is about $8 billion.**

## Export Outlook for Solid Wood Products

**Export Outlook for Solid Wood Products**

***Forecasts are not official USDA estimates.***

- Revised FY 2004 Forecast:      $200 Million to $5.5 Billion
- Initial FY 2005 Projection:   $5.6 Billion

- Revised FY 2004 Forecast
*Key Developments*
-  Exports to China increase mainly due to hardwood demand from its furniture industry
- Initial FY 2005 Projection
*Key Upside Developments*
-  Exports to Canada to remain strong due to re-export demand created by U.S. housing market* *
*Key Downside Developments*
-  Softwood exports to EU and Japan decline due to strong EU production
*Wild Cards*
-  China’s continued economic growth, which fuels its domestic furniture demand

_***Trade Balance***_
**The annual trade deficit in wood products is about $16 billion.**