OUTLOOK FOR U.S. AGRICULTURAL TRADE                        June 4, 1999
June 1999, ERS-AES-22
               Approved by the World Agricultural Outlook Board
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OUTLOOK FOR U.S. AGRICULTURAL TRADE is published four times a year by the
Economic Research Service, U.S. Department of Agriculture, Washington, DC 
20036-5831. This release contains only the text of the report -- tables and
graphics are not included.

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FORECAST 1999 U.S. AGRICULTURAL EXPORTS REMAIN AT $49 BILLION

U.S. agricultural exports for fiscal 1999 are forecast at $49 billion,
unchanged from the February estimate, but 8.5 percent below fiscal 1998.
Further deterioration in prospects for export of some high-value
commodities, especially hides and skins, is offset by slight improvements
in expectations for grain exports. The outlook reflects a more stable
world economic situation and the beginnings of a recovery in Asia.

Grain export forecasts are increased from February by $600 million to
$14.4 billion, while horticultural products are up $300 million to $10.3
billion. Expectations for oilseeds and products exports and livestock
poultry, and dairy exports are down $500 million each to $8.1 billion and
$10.6 billion.

The projected fiscal 1999 import value of $37.5 billion is $500 million
below the February forecast. The downward adjustment primarily reflects
smaller coffee and noncompetitive product import values.

The import reduction leads to a slight improvement from February in the
forecast export surplus to $11.5 billion. The expected 1999 surplus,
however, remains well below 1998.

Table 1--U.S. agricultural trade, fiscal years, 1994-1999
              -- Year ending September 30 --
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Item                1994    1995    1996    1997             1998
1999 Projected
                                                    Feb.     Jun.
-----------------------------------------------------------------------
                        --Billion dollars--

Exports             43.9    54.6    59.8    57.3    53.6     49.0   49.0

Imports     26.6    29.9    32.6    35.8    37.0    38.0    37.5

Balance     17.3    24.7    27.2    21.5    16.6    11.0    11.5
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This outlook reflects commodity forecasts in the May 12, 1999, World
Agricultural Supply and Demand Estimates.

Approved by the World Agricultural Outlook Board and released June 2,
1999.

Contents
                                                                 Page
Fiscal 1999 Agricultural Exports                                     1
Commodity Highlights                                                 4
Economic Outlook                                                     6
Regional Highlights                                                  8
U.S. Agricultural Export Programs                                   10
Import Highlights                                                   11

Tables
                                                                  Page
Table 1--U.S. agricultural trade, fiscal years 1994-99               1
Table 2--U.S. agricultural exports: Value by commodity, 1998-99      4
Table 3--U.S. agricultural exports: Volume by commodity, 1998-99     5
Table 4--U.S. agricultural exports: Value by region, 1998-99         9
Table 5--U.S. agricultural imports: Value by commodity, 1998-99     12
Table 6--U.S. agricultural imports: Volume by commodity, 1998-99    13
Table 7--U.S. agricultural imports: Value by region, 1998-99        14

Coordinator (ERS)                      Coordinator (FAS)

Carolyn Whitton 202-694-5287          Ernest Carter 202-720-2922
Leader, Trade Data Analysis           Special Assistant
Agriculture & Trade Outlook Br.       Office of Deputy Administrator
Market & Trade Economics Div.         Commodity and Marketing Programs
Economic Research Service (ERS)       Foreign Agricultural Service (FAS)

U.S. Department of Agriculture, Washington, D.C. 20250

The forecasts in the Outlook for U.S. Agricultural Trade are based on
information provided by the Market & Trade Economics Division of the ERS
and the Commodity Divisions of FAS. Editorial support is furnished by
Martha R. Evans, Information Services Division, ERS. All telephones are
area code 202.

Commodity Information--ERS: Karen Ackerman (Export Programs, 694-5264);
Ed Allen (Wheat/Coarse Grains, 694-5288); Mark Ash (Oilseeds, 694-5289);
Nathan Childs (Rice, 694-5292); Andy Jerardo (Imports, 694-5323); Mildred
Haley (Beef & Pork, 694-5176); Dave Harvey (Poultry, 694-5177); Gary
Lucier (Horticulture, 694-5253); Steve MacDonald (Cotton, 694-5305);
Stacey Rosen (Food Aid, 694-5164); Matt Shane (Macroeconomic projections
694-5282).

Commodity Information--FAS: Arnella Trent (Tobacco, 720-9496); Lloyd
Coonrod (Seeds, 720-9491); Kimberly Svec (Dairy, Livestock & Poultry
720-8252; Alan Holz (Oilseeds, 720-0143); Dusti Fritz (Grains and Feeds,
690-4200); Dee Linse (Export Programs, 720-9847); Peter Burr (Cotton,
720-9510); Debra Pumphrey (Horticultural and Tropical Products,
720-8899).

Regional projections--ERS: For regional information call: Chris Bolling
(Brazil, 694-5212); Nancy Cochrane (East Europe, 694-5143); Hunter Colby
(China, 694-5215); Fred Crook (Hong Kong, 694-5217); John Dyck (Japan &
South Korea, 694-5221); Anwarul Hoque (South Asia, 694-5222); Sophia Wu
Huang (Taiwan, 694-5225); Susan Leetma (European Union, 694-5153);
Michael Kurtzig (North Africa and the Middle East, 694-5152); Bill
Liefert (New Independent States, 694-5156); John Link (Mexico, 694-5228);
Suchada Langley (Canada, 694-5227); Gary Vocke (Southeast Asia,
694-5241).

The Outlook for U.S. Agricultural Trade is published in February,
May/June, August, and December. The next issue will be released August
30, 1999. The summary and full report may be accessed electronically at
http://www.econ.ag.gov or call (202) 694-5050.

The U.S. Department of Agriculture (USDA) prohibits discrimination in all
its programs and activities on the basis of race, color, national origin,
gender, religion, age, disability, political beliefs, sexual orientation,
and marital or family status. (Not all prohibited bases apply to all
programs). Persons with disabilities who require alternative means for
communication of program information (braille, large print, audiotape,
etc.) should contact USDA's Target Center at (202) 720-2600 (voice and
TDD).

To file a complaint of discrimination, write USDA, Director, Office of
Civil Rights, Room 326-W, Whitten Building, 14th and Independence Avenue,
SW, Washington, DC 20250-9410 or call (202) 720-5964 (voice or TDD). USDA
is an equal opportunity provider and employer.

Commodity Highlights

The forecast for fiscal 1999 exports of U.S. wheat and flour is raised
$100 million from the February forecast to $4 billion, largely reflecting
a 400,000-ton upward revision in export volume to 29.5 million tons. This
revision is due to reduced competition from the European Union and
Canada. The average export unit value for all wheat is forecast at
$132/ton.

Table 2--U.S. agricultural exports: Value by commodity, 1998-1999
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                               October-March     Fiscal  Fiscal 1999
   Commodity                   1998      1999      1998   Projected
                                                         Feb.   Jun.
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                                   --Billion dollars--

Grains and feeds 1/          7.607     7.349    14.109  13.8   14.4
  Wheat & flour              2.088     1.844     3.887   3.9    4.0
  Rice                       0.641     0.661     1.134   1.1    1.0
  Coarse grains 2/           2.787     2.733     4.990   4.8    5.2
    Corn                     2.279     2.424     4.261   4.3    4.7
  Feeds and fodders          1.262     1.215     2.411   2.3    2.4

Oilseeds and products        8.005     5.354    11.090   8.6    8.1
  Soybeans                   4.972     3.205     6.117   4.7    4.5
  Soybean meal               1.373     0.626     1.944   1.2    1.0
  Soybean oil                0.546     0.420     0.881   0.7    0.6

Livestock products           3.948     3.637     7.626   7.9    7.6
  Beef, pork & variety meats 2.040     1.964     4.045   4.2    4.2
  Hides & skins, incl. furs  0.726     0.556     1.358   1.4    1.1

Poultry & products           1.388     1.012     2.712   2.3    2.2
  Poultry meat               1.193     0.846     2.347   1.9    1.8
Dairy products               0.476     0.425     0.897   0.9    0.8
Tobacco, unmanufactured      0.756     0.791     1.448   1.4    1.4
Cotton & linters             1.516     0.883     2.537   1.4    1.4
Seeds                        0.572     0.535     0.838   0.9    0.8
Horticultural products       5.202     5.180    10.318  10.0   10.3
  Fruits & preparations      1.524     1.558     3.202   2.9    3.3
  Vegetables & preparations  1.411     1.438     2.805   2.8    2.9
  Tree nuts & preparations   0.706     0.653     1.215   1.3    1.1
Sugar, tropical, and other   1.003     0.985     2.054   1.9    2.0

    Total 3/                30.475    26.150    53.629  49.0   49.0
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1/ Includes pulses and corn products. 2/ Includes corn, barley, sorghum,
oats, and rye. 3/ Totals might not add due to rounding.

Since February, U.S. coarse grain exports are up 2.4 million tons and
$400 million to 51.8 million tons valued at $5.2 billion. This revision
is almost entirely due to a 2.5-million ton increase in corn export
volume to 46.5 million tons because of less export competition from China
and South Africa. The average export unit value for corn was slightly
increased to $100/ton. Sorghum volume remained unchanged while barley
shipments were lowered 150,000 tons due largely to increased competition
from Australia.

Rice export volume is forecast to remain unchanged from February's
projection at 3.2 million tons, however a $10/ton drop in the average
export unit value is expected to reduce export value to $1 billion. This
is due to larger than expected rough rice exports and lower prices.
Prices are expected to soften further, reflecting prospects for a record
1999/2000 U.S. crop.

Mostly reflecting downward adjustments in soybean and soybean meal export
volumes since February, fiscal 1999 U.S. oilseeds and products exports
are lowered 2.1 million tons to 31.7 million tons valued at $8.1 billion.
Soybean and meal exports are now forecast at 27.4 million tons valued at

Table 3--U.S. agricultural exports: Volume by commodity, 1998-99
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                               October-March     Fiscal  Fiscal 1999
   Commodity                   1998      1999      1998  Projected
                                                         Feb.   Jun.
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                                   --Million metric tons--

Wheat                       12.962    13.330    25.800  28.5   28.8
Wheat flour                  0.247     0.439     0.459   0.6    0.7
Rice                         1.765     2.000     3.315   3.2    3.2
Coarse grains 1/            23.215    27.516    43.960  49.4   51.8
   Corn                     18.955    24.408    37.697  44.0   46.5
Feeds & fodders              5.893     6.285    11.688  11.9   12.3
Oilseeds and products       26.566    21.226    36.018  33.8   31.7
  Soybeans                  18.644    15.110    23.287  22.3   21.2
  Soybean meal               5.527     3.705     8.464   7.2    6.2
  Soybean oil                0.883     0.688     1.396   1.2    1.1
Beef, pork & variety meats   0.770     0.776     1.559   1.7    1.7
Poultry meat                 1.350     1.113     2.663   2.3    2.3
Animal fats                  0.312     0.315     1.365   1.3    1.5
Cotton & linters             0.934     0.593     1.602   0.9    0.9
Horticultural products       3.756     3.797     7.414   7.1    7.5
Other                        3.402     3.629     6.173   6.0    6.3
  Total agriculture 2/      81.172    81.019   142.016 146.7  148.7
  Major bulk products 3/    57.520    58.549    97.964 104.3  105.9
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1/ Includes corn, barley, sorghum, oats, and rye. 2/ Excludes all exports
measured in hectoliters, pieces, dozens, or numbers. 3/ Includes wheat,
rice, coarse grains, soybeans, and cotton.

$5.5 billion. U.S. soybean and meal export volumes were reduced in light
of further upward revisions in the 1998/99 South American soybean
production, stock, and export estimates. The average export unit values
of $210/ton for soybeans and $168/ton for soybean meal remain largely
unchanged, having already been adjusted in February for larger South
American supplies. Reduced export prices and a 100,000-ton reduction in
shipments lowered the forecast for soybean oil $80 million to $600
million. Lagged effects of increased rainfall in Malaysia and Indonesia
further raised estimated palm oil output and pressured prices lower.

The forecast for fiscal 1999 U.S. cotton exports is 900,000 tons valued
at $1.4 billion. The outlook reflects the continued slow pace of U.S.
shipments and continued weakness in foreign demand.

The fiscal 1999 forecast for U.S. exports of livestock, poultry, and
dairy products is lowered $500 million from the February forecast to
$10.6 billion, in large part due to the weaker outlook for hides and
skins. The forecast for beef and pork shipments remains unchanged at 1.7
million tons valued at $4.2 billion. A decline in beef export value due
to lower prices should be largely offset by gains in pork export value as
pork prices rise in response to an anticipated slowdown in U.S. hog
production. Poultry meat shipments remain largely unchanged at 2.3
million tons, but a downward revision in prices reduced export value $120
million to $1.8 billion. In addition to the sharp decrease in shipments
to Russia, weakness in Mexican and Canadian markets is also evident.
Sharply reduced prices and export volume lowered the estimate for hides
and skins from the February forecast by $300 million to $1.1 billion.
Reduced demand from leather industries in Asia has now been joined by a
slowdown in Europe. The value of dairy products slipped $50 million due
to price declines and slower shipments under the Dairy Export Incentive
Program.

The fiscal 1999 forecast for U.S. horticultural exports is raised $300
million from the February estimate to $10.3 billion. Overall exports to
Mexico (our fourth largest market for this category) are running 25
percent ahead of last year's pace, helping to offset slightly slower
sales to Canada. Sales are up to Europe, and sales to Japan and several
other Asian markets are beginning to recover. Fresh and processed fruit
is increased $400 million to $3.3 billion due, in part, to rising apple
shipments. The forecast for tree nuts is lowered $200 million to $1.1
billion due to smaller U.S. almond, pistachio, and walnut crops.

Economic Outlook

The 1999 world economy is in transition. The worst of the global
financial crisis is behind us, and although there is still some potential
for further problems, most analysts feel that the bottom has been reached
and that growth will return to more normal levels in 2000 and beyond.
There is a concern among the leaders of the international organizations
that because the crisis is over, the impetus for reform may weaken.

There is also a sense of uncertainty and unease because the world's two
largest trading economies, the United States and Japan, have been acting
in unpredictable ways. The United States continues to grow in a robust
fashion, with Gross Domestic Product (GDP) growing almost 4 percent for
the 3rd year in a row, while Japan continues to stagnate regardless of
the stimulus applied.

There is also a growing awareness that the locus of global instability
has moved from variations in trade to movements of capital. The
precipitating factor for the global financial crisis was the rapid shift
of capital flows away from the Asian Tiger economies, from highly
positive in 1996 (plus $250 billion) to significantly negative in 1997
and 1998 (minus $50 billion).

For the United States, the impacts of the global financial crisis have
been more positive than negative. Decreased demand and the pressure on
the crisis-affected countries to generate more export revenues has driven
prices of raw materials and manufactured goods down, allowing the U.S.
economy to grow rapidly with little or no inflation. These same factors
have, however, driven the U.S. current account significantly more
negative and made it more difficult to export U.S. agricultural
commodities and products.

The less than 2-percent overall world GDP growth in 1998 will be repeated
in 1999 before climbing slightly to 2.4 percent in 2000. Foreign growth
was only 1.3 percent in 1998 and will be only slightly better at 1.5
percent in 1999. However, by 2000, growth outside the United States is
forecast to double to 2.9 percent as Southeast Asia, Latin America, and
the Middle East rebound from recessions into modestly positive growth.
The European Union, Eastern Europe, the rest of Asia, and Africa are also
projected to increase growth next year.

The European Union's 2.7 percent expansion in 1998 appears to be slowing
to 1.8 percent in 1999 and then is projected to move up to 2.5 percent in
2000. The developing countries' growth increases from 2.3 percent in 1998
to 3 percent in 1999, then is expected to accelerate to almost 5 percent
in 2000. However, as developing countries recover from the effects of
financial crisis and capital flight, U.S. growth is expected to slow down
from the current almost 4 percent growth rate to about 2.5 percent in
2000. A U.S. slowdown would be mitigated by the expected upturn in
foreign economic activity, which should boost demand for U.S. exports.

The U.S. dollar's exchange value is projected to remain steady in nominal
terms in 1999, but should decline in real terms by about 3 to 4 percent
as higher inflation in the rest of the world reduces its purchasing
power. The dollar will be relatively stable against the currencies of
some of the United States' largest markets-Canada and Mexico, but might
appreciate modestly against the European Union. The dollar is forecast to
depreciate in real terms against the Japanese yen and other Asian
currencies as average nominal exchange rates (foreign currency units per
dollar) fall in 1999. The dollar should appreciate against Latin American
currencies in 1999 as recessions and higher inflation in South America
reduce the attractiveness of their currencies to investors.

Regional Highlights

While total expected U.S. agricultural exports to the rest of the world
are unchanged in June from February expectations, the country mix is
slightly altered from February. The outlook for exports to the Western
Hemisphere slipped further and is expected to decline from 1998, due
primarily to less dramatic gains forecast for Mexico. Exports to Asia
continue to be projected down from 1998, but not as sharply as estimated
in February, as some economies in the region begin to show improvement.
Shipments to Africa have been increased slightly from February, but are
still off year-to-year. Expectations for Europe, Russia, the Middle East,
and Oceania are unchanged from February.

Exports to the Western Hemisphere are reduced to $17.8 billion in 1999
compared with $18.1 billion forecast in February and $18.4 billion
shipped in 1998. Sales to Mexico have slowed from earlier expectations.
While exports to Mexico still are projected up year-to-year, forecasts
are reduced $500 million from February. U.S. agricultural exports to
Mexico in 1999 are projected at $6.2 billion. U.S. agricultural exports
to Mexico in the first 6 months of 1999 are off slightly from the same
period in 1998. Soybeans show a significant decrease compared with last
year. But, most of the other large U.S. exports to the country--meats,
wheat, corn, and vegetables--remain above the first half of 1998.

Soybeans, in recent years one of the largest U.S. exports to Brazil, also
are contributing to the downturn in U.S. exports to Brazil in 1999.
Expected 1999 U.S. agricultural exports to Brazil are reduced to $400
million, down from $440 million in February. Brazil has been using
imported soybeans in the soybean processing industry, along with its own
soybeans. However, record soybean production there last year, high
beginning stocks, another large crop expected this year, and the tighter
financial situation, have combined in the first 6 months of 1999 to
reduce Brazil's need for imported U.S. soybeans.

U.S. exports to Canada are forecast at $6.8 billion, slightly more than
forecast in February. Exports to Other Latin America also have been
increased a little from February estimates, to $3.9 billion.

Some improvement in the general Asian economic situation accounts for the
change in expected U.S. agricultural exports to the region. U.S. exports
to Asia are forecast at $17.4 billion, above the $16.8 billion forecast
in February, but still 12 percent less than shipments in 1998. Forecast
exports to South Korea, the Philippines, and Japan have been increased
since February.

The improved economic situation is particularly a factor for South Korea.
U.S. exports to South Korea have been increased to $2.2 billion, almost
equal to shipments in 1998. As the economy began to rebound, demand for
meats and also for feed stuffs, has begun to rise again. Since the
beginning of the fiscal year, U.S. exports to South Korea of meats are up
59 percent in quantity and 19 percent in value, while corn exports have
risen by more than 140 percent in quantity and over 80 percent in value,
accounting for much of the change.

Table 4--U.S. agricultural exports: Value by region, 1998-99
-----------------------------------------------------------------------
                               October-March    Fiscal   Fiscal 1999
   Region                      1998      1999    1998      Forecast
                                                         Feb.   Jun.
-----------------------------------------------------------------------
                                   --Billion dollars--

Asia (excluding Mid East)   11.326     9.624  19.668     16.8  17.2
  Japan                      5.193     4.656   9.459      8.0   8.4
  China                      1.125     0.592   1.514      1.3   1.1
  Hong Kong                  0.848     0.685   1.568     1.3    1.3
  Taiwan                     1.267     1.029   1.971     1.6    1.6
  South Korea                1.196     1.205   2.245     2.0    2.2
  Southeast Asia             1.313     1.133   2.282     2.0    2.0
    Indonesia                0.310     0.247   0.529     0.4    0.4
    Philippines              0.352     0.339   0.744     0.6    0.7
    Malaysia                 0.191     0.173   0.310     0.3    0.3
    Thailand                 0.324     0.246   0.449     0.4    0.4
  South Asia                 0.378     0.318   0.623     0.6    0.6
Western Hemisphere           9.544     9.075  18.370    18.1   17.8
  Canada                     3.464     3.400   7.022     6.7    6.8
  Mexico                     3.042     3.002   5.956     6.7    6.2
  Brazil                     0.381     0.261   0.566     0.4    0.4
  Venezuela                  0.295     0.269   0.516     0.5    0.5
  Other Latin America        2.362     2.144   4.310     3.8    3.9
Western Europe               5.774     4.439   8.844     7.5    7.5
  European Union             5.572     4.280   8.508     7.3    7.3
Central and Eastern Europe   0.194     0.112   0.320     0.3    0.2
New Independent States 1/    0.788     0.247   1.456     1.4    1.4
  Russia                     0.630     0.134   1.103     1.1    1.1
Middle East                  1.304     1.056   2.285     2.1    2.1
  Turkey                     0.319     0.249   0.658     0.6    0.6
  Saudi Arabia               0.324     0.257   0.535     0.5    0.5
Africa                       1.269     1.095   2.167     1.9    2.0
  North Africa               0.924     0.745   1.475     1.3    1.3
    Egypt                    0.570     0.516   0.939     0.9    0.9
  Sub-Saharan Africa         0.345     0.350   0.692     0.6    0.7
Oceania                      0.274     0.252   0.545     0.5    0.5
Transshipments 2/            0.003     0.249   0.075     0.1    0.3
     Total 2/               16.231    14.333  53.629    49.0   49.0
-----------------------------------------------------------------------
1/ New Independent States (NIS) are the former Soviet Union (FSU),
including the Baltic Republics. 2/ Transshipments through Canada are
included in the total only for fiscal 1998 and 1999, rather than being
distributed by country.

Exports to Japan also look somewhat rosier than earlier expected, despite
the continued sluggishness in Japan's economy. Exports to Japan are
projected 5 percent higher than in February, at $8.4 billion. So far in
1999, Japan's growth in demand for U.S. exports of fruits and vegetables
continues rising, supporting U.S. exports. But, for other large exports,
the quantity of meat shipped is virtually unchanged from the same period
last year and corn shipments are still weak, barely above those of the
first 6 months of 1998.

Exports to the Philippines are projected at $700 million, up $100 million
from February's estimate, largely reflecting stronger than expected
shipments in the first 6 months of 1999.

The first half of 1999 exports to China also are off more than previously
anticipated and the pace in the second half would have to increase more
sharply than expected to reach the previous forecast. Consequently,
projected 1999 exports to China are reduced further to $1.1 billion.

Stronger than expected shipments of U.S. agricultural products to Sub-
Saharan Africa in the first half of 1999 led to a slight increase from
February in prospects for 1999 U.S. exports to Africa. Exports to Africa
are projected at $2 billion, above February's forecast of $1.9 billion.
North Africa accounts for the year-to-year decrease in exports to Africa,
as higher grain production there is reducing 1999 import demand.

U.S. Agricultural Export Programs

Export Subsidy Programs
Dairy Export Incentive Program (DEIP) sales are beginning to pick up in
fiscal 1999. One thousand eight hundred six tons of cheese; 3,244  tons
of whole milk powder; and 76,240  tons of nonfat dry milk were sold to
countries in Africa, Asia, the Caribbean, Central America, and the Middle
East in fiscal 1999 as of May 28. DEIP bonuses totaled $87 million for
the same period. Export Enhancement Program (EEP) sales of 2,046 tons of
frozen poultry to Middle Eastern countries were assisted by bonuses
totaling $1.14 million.

Commodity Credit Corporation Export Credit Guarantee Programs
Country allocations under the fiscal 1999 export credit guarantee
programs (GSM-102, GSM-103 and the Supplier Credit Guarantee Program) of
$5.3 billion as of May 21, 1999, were 8 percent lower than year-ago
allocations, and sale approvals of $1 billion were 41 percent lower than
fiscal 1998 approvals. On the 29th of March, USDA extended $1 billion
dollars in GSM-102 credit guarantees to the Republic of South Korea.
Credit guarantee approvals for sales of agricultural commodities to Korea
were $269 million as of May 21, 1999.

U.S. Food Aid Programs
With the exception of Russia, total program funding for Title I and Food
for Progress programs is valued at $233 million for fiscal 1999. Fourteen
countries will be eligible to receive the funding under Title I, while
four countries will be eligible under for Food for Progress funds.
Commodity assistance to these countries is expected to total roughly 1
million tons. As of May 25, agreements had been signed with three
countries, Indonesia, Jamaica, and Nicaragua, and with three private
entities in Indonesia and Russia, with allocations totaling $74.2
million.

The Russia food assistance package, which falls under the PL 480 Title I
and Food for Progress programs as well as section 416(b), is estimated at
$1.2 billion for fiscal 1999. In total, these programs will provide an
estimated 3.2 million tons of commodity assistance.

Commodity allocations for Russia under Title I long-term credit and Food
for Progress include beef, corn, lentils, nonfat dry milk, planting
seeds, pork, poultry, rice, salmon, soybeans, soybean meal, and vegetable
oil. Wheat and wheat flour, totaling more than 1.7 million tons, will be
allocated under section 416(b). As of May 25, 1999, about 640,000 tons of
wheat had been exported, while about 172,000 tons of various other
commodities have been shipped. The bulk of the allocations have not yet
been exported, but are expected to move during this fiscal year.

Import Highlights

The projected fiscal 1999 import value of $37.5 billion is $500 million
more than in fiscal 1998. This projection, however, has been adjusted
downward from the February forecast of $38 billion. The downward
adjustment in the forecast reflects a slower pace of imports in the first
half of fiscal 1999 than in the same period of 1998.

Several of the larger import products, including tobacco, coffee, cocoa,
and rubber, have fallen behind last year's pace and forecasts for these
commodities are reduced from 1998 and from February. These declines so
far in 1999, largely in noncompetitive imports, more than offset small
gains in animal and horticulture product imports. Continued robust
economic activity in the United States, as well as the strong dollar, is
raising demand for red meats, fruits and juices, vegetables, and wine.
Demand for most of these high-value products has been rising since 1996
when the dollar started appreciating. Both animal and horticulture
projections for 1999 are increased from 1998 and February. Grain and feed
projections, however, are unchanged from February, although still
slightly above 1998.

Higher prices for Canadian hogs are increasing import values for live
animals. Red meat prices have likewise inched up from the lows in
December. The price situation is similar for dairy products. While
imports to date of live animals are running slower than last year's pace,
demand for imported red meats and dairy products has increased thus far
this year. Overall, the forecast 1999 import value of animals and
products is expected to be $200 million more than the $6.8 billion
forecast in February.

Imports of grains are slightly higher so far this year as corn and rice
imports have picked up over last year's pace. But since world grain
supplies have been large, prices are still weak. And when weak prices are
combined with the dollar's increased exchange value, grain imports are
not expected to vary significantly from last year's $800 million total.

A jump of more than a billion dollars worth of horticultural imports is
expected in fiscal 1999 over 1998, as purchases of fruits, fruit juices,
and wine so far have risen at a faster pace than last year. June 1999
forecasts for fruits, fruit juices, and wine, are up a combined $600
million from February. In the year-to-date, vegetables are also slightly
ahead of last year's import pace and projections, unchanged from
February, remain above 1998. Estimates for nuts, bananas, and cut flowers
are reduced $100 million each from February.

Table 5--U.S. agricultural imports: Value by commodity, 1998-1999
-----------------------------------------------------------------------
                               October-March     Fiscal  Fiscal 1999
Commodity                       1998     1999      1998    Projected
                                                         Feb.   Jun.
-----------------------------------------------------------------------
                                    --Billion dollars--

Animals and products           3.397    3.493    6.814     6.8    6.9
 Live animals, ex. poultry     0.882    0.789    1.670     1.4    1.6
 Red meats and products        1.320    1.422    2.718     2.8    2.9
 Dairy products                0.633    0.785    1.368     1.4    1.4

Grains and feeds               1.506    1.468    2.919     3.0    3.0
 Grains                        0.348    0.376    0.811     0.8    0.8
 Feeds and products            1.158    1.092    2.108     2.2    2.2

Horticulture products          6.727    7.304   13.850    14.6   15.0
 Fruits, preps., juices        1.666    1.918    4.008     4.2    4.6
  Bananas and plantains        0.580    0.585    1.214     1.3    1.2
 Nuts and preps.               0.340    0.332    0.643     0.8    0.7
 Vegetables and preps.         2.302    2.457    4.249     4.5    4.5
 Wine and malt beverages       1.659    1.880    3.502     3.8    4.0
 Nursery and cut flowers       0.567    0.549    1.082     1.1    1.0

Sugar and related products     0.699    0.700    1.675     1.8    1.7
Tobacco, unmanufactured        0.478    0.387    0.822     0.8    0.7
Oilseeds and products          1.129    1.039    2.243     2.3    2.2
Coffee and products            2.015    1.594    3.587     3.8    3.0
Cocoa and products             0.961    0.858    1.701     1.8    1.6
Rubber and allied gums         0.528    0.401    1.027     1.1    0.8
Other products                 1.475    1.540    2.370     2.0    2.5

Total agricultural imports 1/ 18.915   18.784   37.007    38.0   37.5
-----------------------------------------------------------------------
1/ Totals may not add due to rounding.

Imports of sugar products in the first half of 1999 are within close
range of last year's value as average prices have remained relatively
steady. Forecast sugar imports are reduced from February to $1.7 billion,
about the same as in 1998.

Unmanufactured tobacco imports so far are behind the previous year's
pace, as slack world demand lowered unit values 13 percent below 1998's
early values. The 1999 total is lowered by $100 million from February's
estimate.

Imports of oilseeds for this year are forecast below last year because
both volume and prices are well behind last year's pace. U.S. and global
stocks of oilseeds are abundant. Projections have been reduced since
February.

The largest predicted declines in imports in 1999 compared with 1998 and
the largest downward revisions since February are in coffee and rubber.
Brazil's currency devaluation early this year shrunk the U.S. import bill
for coffee. U.S. imports of rubber and allied gums have been declining
since 1995, partly as rubber prices continue to fall, especially
following the devaluation of currencies in Southeast Asia.

Table 6--U.S. agricultural imports: Volume by commodity, 1998-99
-----------------------------------------------------------------------
                               October-March     Fiscal   Fiscal 1999
   Commodity                   1998      1999      1998    Projected
                                                         Feb.    Jun.
-----------------------------------------------------------------------
                                   --Million metric tons--

Red meats                     0.578     0.655     1.230   1.2     1.3
Cheese and casein             0.125     0.152     0.263   0.3     0.3
Grains and feeds              3.314     3.217     6.431   6.5     6.2
 Grains                                 2.582     2.629 5.101     5.1 5.2
 Feeds and fodders            0.732     0.588     1.329   1.4     1.1
Fruits and preparations       3.688     3.814     7.345   7.8     7.6
 Bananas and plantains        2.077     2.041     4.175   4.1     4.1
Fruit juices                 13.586    14.718    26.577  27.0    28.8
Nuts and preparations         0.119     0.117     0.236   0.2     0.2
Wine and malt beverages      10.049    11.169    22.959  23.5    25.5
Cane and beet sugar           0.825     0.818     2.170   2.1     2.2
Tobacco, unmanufactured       0.127     0.098     0.241   0.2     0.2
Oilseeds and products         2.252     2.005     4.314   4.3     4.0
Coffee and products           0.599     0.675     1.155   1.2     1.3
Cocoa and products            0.486     0.454     0.875   1.0     0.8
Rubber and allied gums        0.557     0.591     1.162   1.2     1.2
-----------------------------------------------------------------------

Table 7--U.S. agricultural imports: Value by region, 1998-99
-----------------------------------------------------------------------
                               October-March     Fiscal  Fiscal 1999
   Region                      1998      1999      1998    Forecast
                                                         Feb.   Jun.
-----------------------------------------------------------------------
                                   --Billion dollars--

Western Hemisphere           10.288     10.165    19.978  20.9   19.3
 Canada                       3.884      3.866     7.798   8.1    7.8
 Mexico                       2.472      2.497     4.669   4.8    4.8
 Brazil                       0.602      0.707     1.207   1.4    1.5
 Colombia                     0.759      0.610     1.360   1.3    1.2
 Chile                        0.464      0.585     0.756   0.8    0.0
 Central America              1.166      0.916     2.180   2.3    1.8
  Costa Rica                  0.371      0.380     0.752   0.8    0.0
 Other Latin America          0.941      0.984     2.006   2.1    2.2
Western Europe                3.759      3.994     7.477   7.7    8.0
 European Union               3.672      3.907     7.295   7.6    7.8
Eastern Europe                0.132      0.129     0.225   0.2    0.0
New Independent States        0.024      0.037     0.052   0.1    0.0
Asia, less Middle East        2.857      2.679     5.698   5.4    5.4
 China                        0.392      0.389     0.754   0.8    0.8
 Southeast Asia               1.781      1.600     3.484   3.4    3.2
  Thailand                    0.391      0.346     0.760   0.8    0.8
  Indonesia                   0.686      0.657     1.360   1.3    0.0
 South Asia                   0.343      0.356     0.804   0.7    0.0
  India                       0.306      0.320     0.727   0.7    0.0
Oceania                       0.925      0.947     2.063   2.2    2.2
 Australia                    0.504      0.494     1.103   1.2    1.2
 New Zealand                  0.401      0.413     0.909   1.0    1.0
Africa                        0.592      0.500     0.969   0.9    0.8
 Ivory Coast                  0.291      0.212     0.393   0.4    0.4
Middle East                   0.337      0.333     0.546   0.6    0.0
 Turkey                       0.255      0.234     0.408   0.4    0.0
Total                        18.915     18.784    37.007  38.0   35.7
-----------------------------------------------------------------------
1/ New Independent States (NIS) are the former Soviet Union, including
the Baltic Republics.

END_OF_FILE