Global Economic Crisis Could Cost U.S. Agriculture $4 Billion

WASHINGTON, DC – The United States is a major exporter of agricultural products, with about 20 percent of its farm output sold abroad, however, an economic crisis in foreign markets is threatening to reduce U.S. export sales. Not only does an economic crisis affect the Gross Domestic Product (GDP) for a country, it also leads to a depreciation in their currency – thus making imports from other countries more expensive.

To examine how a worldwide economic crisis might affect U.S. agricultural exports, researchers at USDA’s Economic Research Service (ERS) simulated a hypothetical economic crisis in the eighth largest global agricultural markets.

The exercise indicated that the value of U.S. exports could decline in an economic crisis by $4 billion per year, and export drop of 6.6 percent. More specifically, results show the value of soybean, beef, and pork exports would fall by around 8 percent, while exports of wheat and corn could drop by 5 percent.

Researchers say the results of this exercise can provide insight into how the current world economic crisis caused by the COVID-19 economic shutdown will affect U.S. agricultural exports.
(SOURCE: All Ag News)