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Economic growth

Agricultural Trade: A Vital Component of the US Economy

Strategic Insights

— 1 min read

The US agricultural trade plays a significant role in driving economic growth and job creation across the country. With over 20% of US agricultural production sold abroad, exports are a key part of this picture, generating $2.06 in additional economic activity for every dollar of agricultural exports. The US Department of Agriculture (USDA) has updated its Agricultural Trade Multipliers, which measure the full impact of agricultural exports. This market intel highlights how trade benefits the US economy, key challenges such as non-tariff barriers, and reviews recent trade policy developments ahead of the August 1 tariff deadline.

Key Takeaways:

  • In 2023, US agricultural exports were valued at $175.5 billion, supporting an additional $186.9 billion in related economic activity, for a total of $362.4 billion in output.
  • Agricultural trade supports a significant number of American jobs, with 1.05 million full-time jobs supported in 2023, including 469,000 on farms and 580,000 in related sectors.
  • The value created by agricultural exports reaches far beyond the farm, extending across the economy, especially in sectors like transportation, logistics, and port operations.
  • Non-tariff barriers, rules or regulations that make it harder or impossible for foreign goods to enter a market, continue to restrict farmers' ability to compete in global markets.
  • Recent trade pacts announced ahead of the August 1 deadline offer new markets for US agriculture, including deals with the United Kingdom, Vietnam, Japan, Indonesia, and the European Union.
  • These deals address long-standing non-tariff barriers and create opportunities for US exports, especially in agriculture, but near-term export gains may be limited due to various factors such as price differences and regulatory barriers.

Statistics:

  • US agricultural exports generated $362.4 billion in economic activity in 2023, with related economic activity generating an additional $186.9 billion.
  • 1.05 million full-time jobs were supported by US agricultural exports in 2023, including 469,000 on farms and 580,000 in related sectors.
  • Agricultural trade generated $175.5 billion in exports in 2023, equivalent to 20% of US agricultural production.
  • Non-tariff barriers restrict farmers' ability to compete in global markets, slowing export growth and reducing farm income.

Sources:

  • [https://www.fb.org/](https://www.fb.org/)
  • [https://www.usda.gov/](https://www.usda.gov/)
  • [Executive Order 14316](https://www.whitehouse.gov/executive-orders/)

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