Agricultural trade highlights

26 Pages·1994·2 MB·English

by  United States. Foreign Agricultural Service

Historic, Archive Document
Do not assume content reflects current
scientific knowledge, policies, or practices.

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United States Agricultural Trade
Department of *■—
Agriculture
Highlights
Foreign
Agricultural
Service
Circular Series
ATH 2 94
February 1994
C
Exports Rise to $4.8 Billion in December U.S. exports of consumer-oriented
products jumped sharply in December,
Strength in Consumer Foods Sales Lead Advance reaching $1.4 billion. This was 17
percent ahead of levels during the same
--December Comparisons-- month last year. Exports rose in all
categories, except breakfast foods, fresh
vegetables, nursery products, and wine
and beer. Double-digit increases were
registered in exports of snack foods,
prepared and preserved red meats,
poultry meat, dairy products, fresh
fruit, juices, tree nuts, and pet foods.
Consumer food exports for the first
three months of fiscal 1994 rose to
$4.1 billion, up 7 percent from the
same period in fiscal 1993 and appears
headed for a new record high in 1994,
the eighth record in as many years.
At $150 million, edible fish and
seafood exports were down 11 percent
from December 1992. U.S. exports of
fish and seafood products for the first
Billion dollars three months in fiscal 1994 rose to
$572 million, up 6 percent from the
same period last fiscal year.
U.S. forest product exports rose to
December trade statistics released on quarter fish exports more than offset a
$587 million in December, up 5
February 17 by the Commerce slight drop in forest product exports.
percent from a year ago. All product
Department placed the value of U.S.
groups in the category posted increases.
agricultural, fish, and forest product At $1.9 billion in December, U.S. U.S. exports of forest products in the
exports at $4.8 billion, a 7-percent exports of bulk commodities rose 2 first fiscal quarter reached $1.7 billion,
increase compared to the same month percent from the same month last year. down 1 percent from 1993's level.
last year. Agricultural exports alone Increased shipments of wheat,
totaled $4.1 billion, up 8 percent from soybeans, and pulses were
the same month last year and is the accompanied by small declines in
second highest export level ever peanuts, tobacco, cotton, coarse grains, Inside This Issue...
recorded for the month of December. and rice. Bulk commodity exports for
Page
Bulk, intermediate, and consumer- the first three months of fiscal 1994
oriented categories all advanced fell to $3.2 billion, 6 percent less than Consumer Food Highlights . 3
compared to last year. Exports of fish 1993’s level. COUNTRY SPOTLIGHT:
and forest products totaled $737
Vietnam. 5
million in December, up 2 percent U.S. exports of intermediate products
PRODUCT SPOTLIGHT:
from the same month last year. reached $849 million in December,
finishing 7 percent ahead of the same Edible Fish and Seafood 8
December’s shipments bring U.S. month last year. Increased exports of Trade Policy Updates .... 11
agricultural, fish, and forest product vegetable oils, animal fats, feeds and Market Updates. 13
exports during the first quarter of fiscal fodders, and hides and skins offset
U.S. Agricultural Exports:
1994 to $14.1 billion, roughly declines in wheat flour, planting seeds,
unchanged from 1993’s level. So far soybean meal, live animals, and sugar, By Commodity Type . 18
this year, lower bulk commodity sweeteners, and beverage bases. By Commodity Group . 19
shipments have been offset by small- Intermediate product exports for the By Region . 20
to-moderate increases in intermediate first three months of fiscal 1994 rose to
Foreign Exchange Rates . . 21
and consumer-oriented exports. $2.5 billion, up 2 percent from the
Likewise, a moderate rise in first- same period in fiscal 1993.
U.S. Agricultural Export Summaries
October-December and Latest Month Comparisons M H
fy 93 fy 94
Product Summary
-Year-to-date-- -Latest month-
Horticultural prods Hortlcultural prods
Soybeans & products Soybeans & products
Wood products 1/ Wood products 1/
Livestock products Livestock products
Feed grains Feed grains
Wheat & tlour Wheat & flour
Fish & Seafoods 1/ Fish & Seafoods 1/
Cotton Cotton
Tobacco Tobacco
Rice Rice
10 15 100 200 300 400 500 600 700
Billion dollars Million dollars
Top Ten Markets Summary
--Year-to-date-
-Latest month-
+ 15%
400
10 15
Million dollars
Billion dollars
Note: Percentages are computed as the change from a year ago.
1/ Not included in agricultural totals.
Trade Highlights 2 February 1994 TEID/FAS [phone]
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Consumer Food Highlights
U.S. consumer food exports hit a new record in 1993 of most part to competition from Brazilian
orange juice. The opening of new
$14.9 billion, 7 percent higher than last year's record and
storage terminals in Japan for the
nearly twice the level of five years ago. Record highs were Brazilian juice in April 1993 may also
have led to greater stocks on hand. A
set in all consumer food categories, except chilled and
cold, wet summer in Japan is also likely
frozen red meats and eggs and products. Double-digit to have depressed prices.
growth occurred in snack foods, breakfast cereals, poultry
Exports of prepared and preserved red
meat, prepared and preserved red meats, and pet foods. meats reached $220 million in 1993, up
21 percent from last year and an all-
time high. Strong growth was seen
At $3.06 billion, chilled/frozen red top ten markets hit record highs, across the board. Sausages and bologna
meats were the largest consumer food including Japan ($393 million), Canada products have done especially well in
export in 1993. However, sales were ($360 million), Mexico ($77 million), Japan and Mexico, and exports of
down 2 percent from last year, the first Hong Kong ($60 million) and the other prepared pork products set a record
decline for the category since the mid- Asian Tigers. While most gains were high in Hong Kong this year. The
1980s. Although sales set a new record modest, shipments to Australia jumped Ukraine and the Russian Federation are
of $ 1.9 billion in Japan, shipments were 53 percent during the year to reach $42 growing new markets for lower-value
substantially lower to Mexico and million. Processed vegetables beef and pork cuts, sausages, and
South Korea. A restriction on imports accounted for most of the growth, similar products.
by South Korea during the first quarter particularly sweet com, french fries,
of 1993 and a pre-NAFTA dispute tomato pastes/sauces, and vegetable- A 4-percent increase in exports of
resulting in a 20-25 percent tariff on based food preparations. nursery products and cut Powers
chilled and frozen red meats entering brought the category to a new record
Mexico from the United States since Tree nut exports closed the year at $998 high of $209 million in 1993. The EU
November 1992 dampened sales to million, nearly an 8-percent increase posted the largest gain, increasing 15
those markets. While Japan continues over last year's level. Half of these percent to $68 million. Shipments to
to be the dominant U.S. export market sales were made to the EU. which Mexico and Japan also set new records.
for red meats, the recession and sticky despite record sales to the Netherlands, While progress was made in Mexico in
retail prices for beef have slowed the UK, and France, posted only slight the areas of foliage and trees/shrubs, cut
growth in value somewhat—only a 6- growth during the period. Spain and flowers accounted for most of the
percent increase this year compared to Italy relied more heavily on domestic growth to Japan. At $100 million,
a 30-percent increase in 1992 following crops than imported U.S. almonds due shipments to Canada, the largest market
the implementation of the U.S.-Japan to higher almond prices as well as the for U.S. nursery products, were off 3
Beef and Citrus Agreement. devaluation of the local currency. percent due primarily to lower sales of
Strong sales to Japan were due in part live plants.
Fresh fruit exports totaled a record $ 1.7 to the continued popularity of almonds,
billion in 1993, slightly above the 1992 but also due to greater demand for less At $139 million, exports of eggs and
level. Shipments to Canada, the leading established tree nuts such as walnuts products were relatively unchanged
U.S. export market, and Hong Kong hit and pistachios. from last year’s level. Moderate growth
their highest levels ever of $609 million occurred in the Canadian, Hong Kong,
and $137 million, respectively. Pet food exports approached the half¬ and Mexican markets for table eggs.
However, the most significant growth billion dollar mark for the first time in Canada also showed growth in sales of
occurred in Mexico, where U.S. fresh 1993 on broad-based growth across hatching eggs. However, these
fruit exports advanced 57 percent to most markets. New record highs were increases were offset by sharply lower
$97 million, another new record. The set in all but one of the top 10 markets. shipments to Japan of eggs for the
four ASEAN countries all posted Substantial increases in shipments institutional and food service sector.
record-setting levels as well. Sales to abroad are a sign of consumers' rising
Japan, the second largest market, were discretionary incomes. For more information, contact Karen
off slightly for the year at $409 million Halliburton at [phone].
due to the recession's impact on Fruit and vegetable juices posted a new
consumption of grapefruit and orange record of $470 million in 1993, rising
imports. just 2 percent above last year’s level.
Exports were up to Canada, the EU,
Processed fruit and vegetables reached South Korea, Taiwan, and Mexico.
a new export record of $1.6 billion, up However, shipments to Japan lagged 25
5 percent from last year. Nine of the percent behind last year's level due in
TEID/FAS [phone] February 1994 Trade Highlights - 3
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Trade Highlights 4 February 1994 TEID/FAS [phone]
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Country Spotlight: Vietnam
With the recent lifting of the U.S. trade embargo on growth strategies of Vietnam's ASEAN
neighbors. Continuation of these
Vietnam, U.S. agricultural exporters are seeking
policies, combined with economic
information on opportunities in this market. The following
growth of 8-10 percent a year and
article addresses some of the most frequently asked normalized trading relations with the
rest of the world, could well lead to
questions about Vietnam as a potential market for U.S.
sizable increases in Vietnam's
agricultural pro due ts.
agricultural imports over the next few
years. In fact, if its imports reach the
Among the world's agricultural Vietnam via transhipments by traders in present per capita level of its ASEAN-4
importers, Vietnam is currently in the third countries. Based on Eurostat and neighbors (Thailand, Malaysia,
minor leagues. The country's 1992 FAC) trade statistics, the European Philippines, and Indonesia), then the
agricultural imports totaled only $213 Union (EU) accounts for 22 percent of country's annual agricultural imports
million, according to trade estimates of Vietnamese agricultural imports. would reach $1.7 billion. Assuming
the UJM.'s Food and Agriculture Analysts at USDA’s Economic Research the U.S. share of this potential import
Organization (FAQ). These imports Service (ERS) estimate that Japan, level reaches the 16-percent mark
included $65 million in grains and Singapore, and Hong Kong, also major attained in other ASEAN markets, U.S.
preparations (mostly wheat Hour), $60 trade partners, accounted for nearly agricultural exports to Vietnam could be
million in cotton, $26.8 million in food three fifths of the country's agricultural in the range of $250-300 million a year.
preparations (mostly consumer foods), imports in 1991. The time required to reach these figures
$10.4 million in vegetable oils, $3.5 is difficult to assess. However, if
million in unmanufactured tobacco Although $200 million a year is realized, this would be roughly equal to
products, $2.3 million in beer, and $45 relatively small compared with the the U.S. export levels seen prior to the
million in other products. imports of many other developing Asian imposition of the trade embargo. If this
economies, this is more a reflection of same market share assumption is
While the United States has not Vietnam's previous inward-looking applied to Vietnam's actual 1992
exported to Vietnam since the economic policies. Today, these imports, then short-term sales prospects
imposition of the trade embargo, other policies are giving way to outward¬ are substantially lower, roughly $30
countries have been exporting to looking economic development million a year.
Vietnam for years and even U.S. strategies that emphasize the role of
products have been reported entering foreign investment, modeled after the Products With Promise
According to FAQ statistics and ERS
Vietnam's Imports of Agricultural Products studies, products whose prospects for
export growth appear bright include
wheat and flour; feed grains; poultry,
$Million
pork, and processed meat; oilseeds and
vegetable oils; fresh and processed
fruits; and cotton. There are limited
opportunities in branded consumer
products. In addition, there is a great
need for agricultural inputs and
assistance for development of the
country's agriculture, transportation, and
trade finance infrastructures.
Vietnamese import demand for wheat
flour has been steadily rising, reaching
$49 million in 1992 compared to $8.5
1986 1987 1988 1989 1990 1991 1992 million in 1986. The EU supplies
nearly 50 percent of wheat Hour
imports. Vietnamese demand for Hour
TEID/FAS [phone] February 1994 Trade Highlights - 5
Vietnam
comes from urban consumption of supplement the current use of rice in affluent urban population and the tourist
bread and pastries which is a legacy of livestock feed rations. trade. In fact, U.S. consumer food
French colonial rule. products already have a widespread
Beyond the feed grain market, in the presence in the market (mostly in the
Feed inputs for the livestock sector also longer term, there is a potential market more affluent south) via third parties
offer trade opportunities. The World for direct exports of U.S. meat based in Singapore or Hong Kong.
Bank reports that prospects appear to be (especially pork) and poultry if rising There are also trade reports that
strong for rising meat consumption income drives up demand for meat Vietnam may follow its Asian partners
since incomes are rising and Vietnam faster than domestic production in expanding textile exports, which
currently has a very low per capita meat increases. The World Bank has implies a need for more cotton —
consumption level of 12-13 kilograms identified an urban preference for already one of the country's leading
(live weight). Livestock production quality lean meat and a willingness to agricultural import products.
(principally pigs and chickens) is at a pay a price premium of 200 percent. In
primitive backyard level. As the addition to meat, there is growing However, there are constraints to
livestock sector moves to a larger scale demand for consumer foods, including expanded imports. Vietnam's poor
of production, Vietnam is a potential fresh fruits, soft drinks, and other transportation infrastructure is a major
market for feed grains that would branded processed foods for the more barrier to increasing levels of trade.
Vietnam's Economy at a Glance
Vietnam is a Southeast Asian country bordered by Laos and Cambodia to the west, China to the north, and the South
China Sea to the east. Its land area of 325,360 square kilometers is slightly larger than New Mexico. The terrain is
low, flat delta in the south and north. The central portion is highlands, while hilly, mountainous areas make up the far
north and northwest. The country suffers from occasional typhoons and flooding.
The country's natural resources include phosphates, coal, manganese, bauxite, chromate, offshore oil deposits, and forests.
Twenty-two percent of the land is arable; the rest is meadows and pasture, forest and woodland, permanent crops, irrigated,
or other.
More than 69 million people inhabit Vietnam, 33 million of whom are in the active labor force. Sixty-five percent of those
are in agriculture and the rest are in either the industrial or service sectors. The country is classified as low-income by
the World Bank, with a per-capita GDP of approximately $220 a year.
The agricultural sector is the largest part of the economy, accounting for more than half of Vietnamese GDP. Paddy rice,
corn, and potatoes make up 50 percent of farm output. Other important crops include aibber, soybeans, coffee, tea,
bananas, and animal products. Current farm sector reform likely will have a very positive impact on production, as new
land laws grant long-term tenure rights.
The industrial sector is experiencing a boom. For the first half of 1993, production was up 10.2 percent over the same
period a year earlier. The oil and gas sector appears to have the greatest potential, although few commercially feasible
wells have been found. Following oil and gas, steel and cement have the next two highest growth rates of 24 percent and
20 percent, respectively.
Despite the boom, infrastructure remains woefully inadequate. There tire only 154,500 telephone lines for almost 70
million people. Moreover, power outages have been affecting the south and transportation of significant quantities of goods
is a demanding task in a country where only 10 percent of the 65,000 miles of roads are paved.
The dong is Vietnam's currency. As of January 24, 1994, it traded at 10,865 dong per U.S. dollar. According to the IMF,
Nonresidents can freely reconvert into foreign currency and transfer abroad unused balances in Vietnamese currency that
have been acquired against foreign currency. Vietnamese citizens are allowed to sell foreign exchange in their possession
to banks, or to deposit it into interest-bearing foreign currency bank accounts." Moreover, the thrust of government policy
is to further liberalize the exchange rate regime.
Trade Highlights - 6 February 1994 TEID/FAS [phone]
Vietnam
Vietnam’s Agricultural and Industrial Development Policies
Vietnam's agricultural and economic policies have passed through three stages, culminating in the current transition toward
a market orientation. The first stage, from 1976 - 1981, was collectivization based on traditional Soviet central-planning
models, with an emphasis on industrial development at the expense of agriculture. The second stage, 1982 - 1987, was
the implementation of the contract system based on the China's model of agrarian reform. During this phase, contract
prices were set for farm production rather than production quotas.
In 1986, doi moi, or renovation, was adopted. This was a shift toward a multi-sectoral economy, with an emphasis on
developing food production and agriculture. The most visible result was the sharp growth in rice production which resulted
in Vietnam shifting from a net importer to a net exporter of rice. The third stage in economic policy, 1988 - 1992, has
been the shift toward an outward development strategy closer to the model of Vietnam's Southeast Asian neighbors, such
as Thailand, Malaysia, and Indonesia. Applied to agriculture, this phase is a transition to family farming with de facto
land ownership. Vietnam has also opened its borders to foreign investment to foster economic development.
In agriculture, the most notable impact of doi moi has been the emergence of Vietnam as the world's third leading exporter
of rice. Most of the increases in rice production have been in the Mekong River delta, with some increases in the Red
River delta. So far, according to the World Bank, other regions and secondary starch crops, such as corn, sweet potato,
and cassava, have lagged behind the advances in rice production.
Industrial development appears to be repeating the pattern of initial economic growth seen in other Asian Pacific Rim
countries. Foreign light industry investment is rising rapidly, with investments from Taiwan, Hong Kong, South Korea,
France, and Australia attracted to Vietnam's low-cost labor. Industrial investments have been concentrated on garment and
footwear assembly and in seafood processing. Most investments have been in southern Vietnam (Ho Chi Minh City)
because of the better infrastructure and perception of better capitalist management skills (the legacy of a 20-year U.S.
presence). Burgeoning tourism has also attracted hotel investments in major cities.
There are apparently major offshore oil and gas reserves in Vietnam which are attracting substantial foreign investment.
According to a study by the Hong Kong investment bank - Smith New Court Far East Ltd, an estimated 1 billion barrels
of oil is in the Bach Ho (White Tiger) field off the Mekong delta. Other estimates of oil reserves range up to 3 billion
barrels. Vietnamese oil production was 110,000 barrels per day in 1992 and, according to the study, is expected to rise
to 400,000-600,000 barrels per day by the end of the decade.
A new constitution adopted by the government in 1992 undergirds Vietnam's economic reforms by guaranteeing a
"multisector economy in accordance with the market,’' along with a "private capitalist economy" and foreign ownership
rights. The constitution also gives the National Assembly enhanced powers and legislative oversight. The Socialist
Republic of Vietnam is a one-party state ruled by the Communist Party.
The transportation system and the high Summary and other prosperous Asian nations can
cost of transporting goods internally turn Vietnam into one of the new Asian
results in regional food shortages even Vietnam has the potential to be the next Tigers in the near future. If so, the
as Vietnam is self-sufficient in rice high-growth market in Asia. In the country's agricultural imports should
overall. Another major barrier is the short run. weaknesses in the rise substantially from present levels,
limited capacity of the seven transportation and port system are and the world's agricultural exporters
Vietnamese ports. Those ports are in significant barriers to trade expansion, will have an opportunity to aggressively
dire need of modernization if they are as are low per capita incomes. compete for Vietnam's business or
to handle containerized shipments. However, the same types of market- watch from the sidelines.
oriented development policies that For more information, contact Robert
transformed the economies of South Tse at [phone] or Ignacio Diaz
Korea, Taiwan, Hong Kong, Singapore, at [phone].
TEID/FAS [phone] February 1994 Trade Highlights - 7
Product Spotlight: Edible Fish and Seafood
the value of Japan's fish and shellfish
As the world's largest exporter of fish and seafood, U.S. sales of
imports increased by 95 percent from
these produets more than doubled in five years, from $1.6 billion in 1986 to 1992, rising $6.2 to $12.8
calendar 1987 to $3.4 billion in 1992, before dropping to $3 billion billion in the process. However, that
market has softened considerably over
in 1993. Sharply higher sales of surimi, roe and urchin, crab and
the last year as their economic recovery
canned salmon are most significant among the gainers. In addition
began to slide again, hitting Japanese
to the expansion in exports, the U.S.'s share of world trade rose to consumers in their pocketbooks and
more than 10 percent, primarily at the expense of the EU. Fueled bringing lower prices for seafood
exporters.
primarily by rapidly growing demand in the U.S.'s top markets, U.S.
exports of edible fish and seafood should continue to climb Also supporting the expansion of trade,
throughout the decade, and could reach $4.5-5 billion by 1999. the European Union (EU) strengthened
its seafood imports from $5.2 to $11.5
billion (excluding intra-trade) from
Edible fish and seafood products are a highly concentrated. Sixty-six percent
1986 to 1992. This growth is tied to
major U.S. export success story. go to Japan, and 87 percent is shipped
changes in eating patterns, overfishing
According to the Department Of to the top three markets (add Canada
in European waters, and the abundance
Commerce's National Marine Fisheries and the European Union). However,
of cheaper fish imports. In Europe, as
Service, the U.S. catch of edible even smaller markets are significant.
in the U.S., fish and seafood is
commercial landings and aquaculture For example. South Korea, which ranks
increasingly viewed as a healthy
production together grew more than 86 fourth as a destination for U.S. exports,
alternative to meat.
percent in volume from 4.4 billion lbs. is now a $110 million market. Sales to
in calendar 1987 to an estimated 8.3 Taiwan, which is the U.S.'s fifth largest
U.S. Gains in Global Market Share
billion lbs. in 1992. U.S. overseas sales market, is a $45 million market.
grew at an even more rapid pace,
Tire U.S.’ share of global exports
expanding more than 110 percent over The U.S. gained in global market share
(excluding EU intra-trade) climbed to
the same period to reach a record $3.4 even as the absolute value of
10.3 percent of world fish and seafood
billion in 1992, the eighth record set in international seafood trade expanded.
trade in 1990, the most recent year
as many years. This makes exports The growing affluence of overseas
available, up from 5 percent in 1971.
vital to the U.S. fisheries industry. customers, which makes offshore
Interestingly, most of the gain in market
Exports in 1992 accounted for shipments of live and frozen seafood
share has been at the expense of the
approximately one-quarter of U.S. possible for those who can afford it, is
European Union, which fell from an 11-
edible production volume. one reason for the expansion of trade.
percent to a 6-percent share over the
This is as true in Japan, the largest
same period. Tire EU's decline largely
U.S. edible fish and seafood exports, seafood importing country, as in other
reflects the depletion of resources
which were $3 billion in 1993, are Asian NICs. FAQ statistics reveal that
surrounding the European continent.
U.S. Gains on EU in Global Seafood Competition
There are marry reasons for the U.S.'
gains. Legislated changes in legal
Percent
fishing boundaries which excluded non-
u.s. U.S. fishing fleets from U.S. territorial
waters, the aggressive exploration of
EU marine resources, and rising incomes in
target markets help explain the increase
Rest ot World in U.S. exports. Improvements in cold
storage facilities and cargo techniques
have resulted in demand for product
year-round, rather than seasonally as in
previous times. Additionally,
international marketing efforts led by
industry associations such as the
Alaskan Seafood Marketing Institute
(ASMI), the U.S. Surimi Commission,
The Catfish Institute, the Southeast
Fisheries Association and 3 of the 4
regional cooperators increased the
Trade Highlights - 8 February 1994 TEID/FAS [phone]