American farm exports, which have risen to record highs in recent years, are expected to drop due to lowered international demand and a sluggish global economy. A significant decline in farm exports could hurt the U.S. farm economy, which has benefitted greatly from vibrant overseas sales.
For the past several years, Secretary of Agriculture Tom Vilsack and President Barack Obama have gone to great lengths to expand U.S. agricultural trade. In the middle of a major economic recession, the farm sector has been an important lynchpin of the economy; one of the few major U.S. industries that is still creating jobs. The center stone of these trade policies were several recently approved free trade agreements with Panama, South Korea, and Columbia.
Farm exports are expected to drop, however, due to economic pressures and decreased demand. According to a U.S. Department of Agriculture report, American farm exports will drop by about $3 billion, a decline of roughly 2 percent.
A major cause of the export drop is the ongoing Eurozone crisis. Crisis in European markets and weak economies among several European Union member states have plunged many Western nations into a recession. These economic difficulties will translate into fewer imports and less demand for American goods.
“Continuing turmoil in European financial markets, coupled with falling employment and GDP in most of the euro zone, reflects a recession likely to last through most of 2012,” the USDA report said. “World 2012 growth is expected to slow.”
To learn more about agricultural financing opportunities contact a Farm Plus Financial representative by calling 866-929-5585 or by visiting www.farmloans.com.
Follow us on: Twitter
Written by: Justin Ellison / Farm Plus Staff Writer