Farm exports up, helping industry weather the recession

While much of the U.S. economy continues to struggle despite signs of a slow recovery, federal estimates of farm trade and income show the agriculture sector is being boosted by a surge in exports. "The estimates confirm what economists have been saying for months: agriculture, which was generally not hit as hard by the recession as many other segments of the economy, remains a small bright spot going forward," William Neumann of The New York Times reports. Estimates predict U.S. farmers will ship $107.5 billion in agriculture products abroad by Sept. 30.

“We’re just having a robust rebound in the agricultural sector and promises of more growth,” Jason R. Henderson, vice president and economist at the Omaha branch of the Federal Reserve Bank of Kansas City, said in a recent interview. The $107.5 billion would be the second highest total ever in a fiscal year, behind the $115.3 billion worth of exports from 2008. Next year exports are expected to top $113 billion, Neumann writes. U.S. Department of Agriculture Sec. Tom Vilsack pointed to grains and meats as leader in the rebound and called the estimates "very encouraging."

"The export growth is propelled by higher prices for many products, including wheat, whose prices have skyrocketed as drought and punishing heat decimated crops in Russia, Ukraine and Kazakhstan," Neumann writes. "Exports to Asia have been particularly strong, and China is forecast to surpass Mexico next year to become the second-largest foreign buyer of American farm products. Canada is the No. 1 export market." Total net farm cash income was estimated at $85 billion, up 25 percent from 2009 and above the ten-year $72 billion average. “The farm economy in rural America has not suffered as severely as the industrial part of the economy and, because of the strong exports, the rural economy is recovering what it lost during the downturn,” Roy Bardole, chairman of the Soybean Export Council, told Neumann. (Read more)