It’s hard to open an agriculture publication these days without reading something related to agriculture trade; and for good reason. Strong agriculture exports (along with the boom in ethanol production) have been the key drivers of agriculture prosperity over of the last decade. Continued prosperity in agriculture over the next 10 years will have much to do with how well we’re able to tap into a growing world market that we know will have more mouths to feed.
While some skeptics still question the value of trade to agriculture, it’s impossible to escape the numbers.
For perspective, total U.S. agriculture exports increased 30 percent over the last five years. Here in Nebraska, we shared in that trend. From 2009-2013 the value of Nebraska exports increased 36 percent, led by a 116 percent increase in beef exports, and major increases in exports of both soybeans (29 percent) and soybean meal (53 percent).
Most of the recent export gains have been strongest in the NAFTA countries and non-Japan Asia markets. China is a now a major player in world agriculture trade. From 2004 to 2014 U.S. exports to China increased 330 percent. During that time U.S. agriculture exports to NAFTA partners Canada and Mexico were also up 121 and 130 percent, respectively. These trade opportunities have not only helped boost farm prices and income, but also helped support about 50,000 Nebraska jobs both on the farm and in related industries such as food processing, transportation and manufacturing.
The importance of agriculture trade to farm income is expected to continue into the next decade as global demand for overall agricultural products is expected to grow in the years ahead. USDA projects total U.S. agriculture exports will increase another 23 percent between 2014 and 2024. One of the largest projected growth areas for U.S. agriculture exports during that period lies in markets Nebraska is well positioned to fulfill, namely demand for livestock, poultry and dairy products.
While numerous factors will influence Nebraska’s agriculture export potential over the next decade, the U.S. ability to tap into and be a part of future trade agreements is one of the largest. That’s why Farm Bureau has been such a strong proponent of Congress granting the President Trade Promotion Authority (TPA). Regardless of how this Administration has handled other issues related to agriculture, there is little to debate when it comes to trade. It’s vital to the future of agriculture prosperity. TPA has been given to every U.S. President since 1974 and without it, the Administration is lacking what it needs to show potential trading partners that Congress is serious about moving ahead in trade negotiations.
Right now the U.S. is negotiating new trade agreements with some of the world’s largest and fastest-growing economies, including Europe and 11 Asia-Pacific nations, through the Trans-Atlantic Trade and Investment Partnership (T-TIP) and the Trans Pacific Partnership (TPP). It’s critical Congress grant TPA authority to shore up the U.S. position in these and other trade talks. Trade deals are going to be made, and will be made. Without TPA, the U.S. and Nebraska farmers and ranchers could be the ones left on the outside, looking in.
Until next month,
Steve Nelson, President, Nebraska Farm Bureau Federation