In 2019, the U.S. ran its first agricultural trade deficit in nearly six decades. Exports were still generally on an upward trend so few expressed concerns that imports had increased even more. But soon it happened twice again: in 2020 and 2023.
In 2019, the U.S. ran its first agricultural trade deficit in nearly six decades. Exports were still generally on an upward trend so few expressed concerns that imports had increased even more. But soon it happened twice again: in 2020 and 2023.
Transcript
As it had in some preceding years, the United States in 1960 exported more agricultural goods to other countries than it imported. That year also kicked off an uninterrupted stretch of 59 years of agricultural trade surpluses.
Then, in 2019, the U.S. ran its first agricultural trade deficit in nearly six decades. Exports were still generally on an upward trend so few expressed concerns that imports had increased even more. But soon it happened twice again: in 2020 and 2023. With 2024 heading the same direction, a handful of ag and trade groups are speaking up about their concerns.
Katie Hettinga, Rethink Trade: “The 2023 ag trade deficit is the largest on record, at $16.6 billion in the red. And the 2024 deficit is projected to be nearly double that…The United States is becoming more reliant on other countries for its food supply.”
Rethink Trade is an anti-monopoly non-profit. Farm Action is a Missouri-based non-profit working toward a fair food system.
Christian Lovell, Farm Action: “Anybody in agriculture circles, they hear this adage you know: ‘American agriculture feeds the world.’ But when you actually look at the numbers, the truth is in terms of the food that you and I and we all eat, we’re not even really feeding ourselves.”
While a strong U.S. dollar plays into the equation, some are concerned that the nation’s international free trade agreements have helped some global companies, but may be harming U.S. producers raising more labor-intensive products such as fruit, vegetables, or livestock.
Christian Lovell, Farm Action: “When you look at a value basis, the fruit and vegetables are definitely a higher value crop and that’s what we’ve grown our reliance on importing those products…if we just converted one half of one percent of current U.S. farmland to specialty crops, we could have completely wiped out the deficit last year.”
The lamb industry has felt the impact of the trade shortfall. Large meat processors buying for U.S. consumers tend to choose cheaper lamb from places like Australia.
In 2022, Australia accounted for 75 percent of the $1.53 billion worth of sheep and goat meat imported into the U.S. That same year and halfway through 2023, U.S. lamb feeders endured 15 consecutive months of losses. And, unlike U.S. farmers raising many other single commodities, sheep producers don’t currently have an active government-subsidized insurance program.
The U.S. sheep industry has asked for a U.S. International Trade investigation into whether imports are causing substantial harm to the industry.
R-CALF primarily advocates for independent cattle producers but is trying to help the sheep industry as the export-import balance is relevant to both livestock sectors.
Bill Bullard, CEO, R-CALF: “We’ve seen more imports and consumers have not benefited. Consumers are paying record prices for beef at a time when imports are skyrocketing. So what this tells us is this is a boon for the multinational meatpackers because they can source beef from other countries - 20 different countries - that do not meet the same production standards… While domestic production was collapsing, imports were increasing. In 2006, this canary in the coal mine, the U.S. sheep industry became the first livestock sector in America to be outsourced... If anyone wants to know the answer as to whether or not imports can destroy a domestic industry, you can see right here it has destroyed our commercial sheep industry. Today, 74 percent of all the sheep and mutton consumed in America is derived from foreign soil.”
Although U.S. sheep producers finally saw a glimmer of hope with positive returns beginning in June 2023, many had departed the business. Todd Hintz, who raises lambs with his wife, Peg, and their adult son, saw this in his region of northeast Nebraska.
Todd Hintz, Sundance Farms, Meadow Grove, Nebraska - “We have had I think within 20 miles, we have lost four lamb growers, or sheep farms. Some of them, I think the work was too much, and then some of them, the low prices kind of pushed them out.”
The nation’s 2023 lamb crop was the smallest on record, with just over 3 million head.
Todd Hintz, Sundance Farms, Meadow Grove, Nebraska - “Last year we were at the $2 break point - was our break - just because alfalfa and corn and then feed costs were so high…If you have to buy everything, you probably weren’t making any money last year…I think more and more people will be leaving. The work is hard and you have to be dedicated and when you have the highs and the lows, the cycles of making money or losing money, it seems like when you have one bad year, it takes two years to make up for the loss.”
Iowa sheep producer Tony Vorm and his wife work other full-time jobs, but their Katahdan hair sheep operation is profitable as they have focused on breeding stock - which garners higher prices - as well as slaughter lambs.
Tony Vorm, Turbine View Farms, Nevada, Iowa: “We’ve seen a lot of increase and decrease. Lambing is seasonal. Pricing is seasonal. Easter and ethnic holidays are the peak season. But also we’ve seen some volatility like last year, prices were really low. But the year before that, prices were at all-time highs. ”
Vorm wonders if the U.S. should consider supporting its own producers more.
Tony Vorm, Turbine View Farms, Nevada, Iowa: “We import a lot of lamb that we probably could import less and use more from here. So that sometimes drives the price down I think. We import so much that we’ve got a surplus.”
After years of lobbying started by American Grassfed Association, which was concerned about misleading labeling, USDA last month finalized a new rule for Country of Origin labeling saying that all meat products sold with the “Product of USA” label must be derived from animals born, raised, slaughtered and processed within the U.S.
Bill Bullard, CEO, R-CALF: “We’re not against imports. Imports are important to our economy…What we need to look at is when those exports exceed the threshold where they begin to destroy our domestic supply chains and render us dependent on foreign soils for our food supply, then we must take action. And we’ve long passed that in both the cattle and sheep industries.”
By Colleen Bradford Krantz, [email protected]
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