Agricultural exports in fiscal 2016 are forecast at $138.5 billion, which is $1.0 billion below the revised fiscal 2015 forecast. Bulk export values are forecast to fall, primarily as a result of lower U.S. oilseed prices and export volumes. U.S. high-value product exports are forecast to rise in fiscal 2016, although a strong U.S. dollar could limit export increases of these products. Canada is expected to return as the largest U.S. export market for the first time since 2010.
The forecast for China is $20.5 billion, which is $2.0 billion lower than the fiscal 2015 forecast, and Canada is forecast to replace China as the largest U.S. export market. Soybeans account for about 60 percent of exports to China, and soybean values (both prices and volume) are expected to fall in fiscal 2016. U.S. soybean prices are expected to be down due to near-record domestic production and larger ending stocks. Despite these lower prices, U.S. export volumes are expected smaller as a strong U.S. dollar and robust exportable supplies in South America will limit U.S. competitiveness to China. As of mid-August, U.S. export sales to China for the upcoming marketing year were sharply lower than previous years. U.S. cotton sales to China are also expected to decline as a result of a smaller U.S. crop and weaker Chinese import demand. U.S. exports of sorghum and DDGS, however, are expected to continue to remain strong in fiscal 2016.
Japan is forecast at $12.0 billion in fiscal 2016, up $200 million from fiscal 2015. Although bulk values to Japan are expected to be down again due to lower soybean prices, U.S. pork exports are expected to strengthen (Japan is the largest U.S. pork export market), as are horticultural export values for products such as tree nuts. Exports to Southeast Asia are forecast unchanged from fiscal 2015 as higher wheat exports are forecast to offset reduced soybean and soybean meal export values in markets such as Indonesia.
Mexico is forecast up $200 million to $18.5 billion as a result of stronger expected exports of horticultural products, pork, and grains—soybean and soybean meal export values, however, are expected to fall. The forecast for Canada is steady at $21.8 billion as expanded horticulture exports offset lower oilseed values. Exports to South America are up $300 million from the fiscal 2015 forecast as a result of expected stronger U.S. wheat exports later in the fiscal year (from reduced Canadian competition). Exports to Colombia and Peru are each raised $100 million.
Europe, Africa, and the Middle East
Exports to the EU are forecast at $12.0 billion, down $100 million from fiscal 2015. Higher horticultural exports of products such as tree nuts are expected to only partially offset lower values for soybeans and soybean meal (the EU is the second-largest U.S. soybean market after China and the thirdlargest soybean meal market). Exports to Russia are unchanged at $400 million as a large number of U.S. agricultural exports remain banned. Exports to the Middle East and Africa are forecast to remain unchanged as continued strong export competition from the Black Sea region into these markets limits U.S. export increases.
Revised outlook for fiscal 2015
The forecast for agricultural exports is lowered $1.0 billion from the May forecast to $139.5 billion with lower exports to Japan, Mexico, and Africa.
The forecast for Japan is lowered $500 million to $11.8 billion as a result of slower-than-expected shipments of grains and oilseeds, as well as lower pork exports. South Korea is raised by $200 million to $6.4 billion as a result of record pork and tree nut shipments.
Exports to Indonesia are lowered $100 million primarily due to lower wheat and soybean exports. Vietnam is raised $200 million to a record $2.4 billion as a result of sharply higher cotton and tree nut exports. South Asia is raised $200 million as a result of larger exports to India, Pakistan, and Bangladesh. India is raised $100 million as a result of strong tree nut and apple sales.
The forecast for Canada is unchanged at $21.8 billion, but the forecast for Mexico is lowered $400 million to $18.3 billion. For soybeans, corn, and wheat, not only are values down but, in the first 9 months of fiscal 2015, U.S. export volumes to Mexico are also smaller. U.S. dairy product shipments are also down (Mexico is the largest U.S. dairy export market). The forecast for Central America is raised $200 million, while the forecast for the Caribbean is lowered $200 million as a result of slower exports to Cuba and other markets.
The forecast for Peru is raised $200 million and the forecast for Colombia is raised $100 million. For Peru, U.S. corn exports in the first 9 months of the fiscal year have already reached a record, and U.S. rice, soybeans, and soybean meal exports have reached records in Colombia. Brazil is lowered $100 million as a result of smaller U.S. wheat sales, and Venezuela is lowered $200 million due to sluggish wheat, corn, and soybean meal shipments.
Europe, Africa, and the Middle East
The forecast for the EU is unchanged at $12.1 billion. Despite a significantly stronger dollar, U.S. horticultural exports (which account for about half of U.S. agricultural exports to the EU) have continued to expand in fiscal 2015. The forecast for the Middle East is unchanged at $5.9 billion. Although Turkey is lowered $100 million to $1.7 billion as a result of reduced sales of cotton, this decline is offset by stronger exports to other countries in the region (such as the United Arab Emirates).
The forecast for Africa (North and Sub-Saharan) is lowered $300 million to $3.8 billion. If realized, this would be the smallest export level to Africa since 2006. The forecast for Egypt is lowered $200 million to $1.0 billion due to sharply lower U.S. corn sales. Nigeria is lowered $100 million as a result of reduced wheat shipments. In both of these markets, U.S. grains have faced strong competition from Black Sea region suppliers.