The USDA has shared its Economic Research Service and Foreign Agricultural Service Situation and Outlook Report for August, which places agricultural exports in Fiscal Year(FY) 2025 forecast at $169.5 Billion and imports at $212.0 Billion.

The report states that exports are down $4.0 billion from the revised forecast for FY 2024, primarily driven by lower unit values of soybeans, corn, and cotton, as well as lower volumes of beef.

Additionally, Mexico and Canada are projected to remain the first and second largest U.S. agricultural markets, respectively.

For FY 2024, the latest outlook places the export forecast at $173.5 billion, up $3.0 billion from the May projection, largely due to higher horticultural and grain exports.

On the other hand, imports for FY 2025, forecasted at $212.0 Billion are $8.0 billion higher than the revised 2024 estimate, largely due to rising imports of horticultural as well as sugar and tropical products, according to the report.

Exports

The upcoming year is expected to be record-breaking for U.S. horticulture product exports. According to the report, they will reach a record $41.5 billion, up $1.2 billion from 2024. 

"Fresh fruits and vegetables are forecast $100 million higher to $7.6 billion due, in part, to rising apple shipments to India following last year’s lifting of retaliatory tariffs that had been in place since 2019," the report says. 

Additionally, processed fruits and vegetables are forecast $300 million higher to $8.3 billion on rising exports to Canada, Mexico, and Europe.

For FY 2024, the estimate for horticultural products is raised $1.3 billion, to $40.3 billion. Fresh fruits and vegetables are revised $400 million higher to $7.5 billion and processed fruit and vegetables are up $300 million to $8.0 billion on stronger strawberry shipments to Canada and dried bean exports to Mexico.

For Canada in particular, the report states that the export forecast for Canada is unchanged at $28.9 billion, as higher prospects for horticultural products balance out lower exports of beef.

Imports

In terms of imports, which are forecast at $212.0 billion, mark an $8.0 billion increase over the FY 2024 forecast.

In FY 2024 imports are forecast at $204.0 billion, $8.6 billion more than the $195.3 billion recorded for FY 2023 and $1.5 billion higher than the May forecast.

The U.S. economy remains strong going into the final months of FY 2024, although that growth is predicted to slow into FY 2025. While FY 2024 imports are expected to grow by 4.4 percent, the FY 2025 growth forecast is expected to be slightly lower at 3.9 percent.

Both remain below the average annual import growth rate of 5 percent between FY 2010 and FY 2020, the 10 years before the Coronavirus (COVID-19) pandemic, the report says.

The FY 2025 horticultural import forecast is $104.5 billion, which is a $4.0-billion, or 4 percent, increase over the FY 2024 forecast.

Fresh fruits are the largest component, growing by $800 million (4 percent) to $20.3 billion.

Additionally, fresh fruit import volumes are projected 100,000 metric tons higher, in part, due to the expectation of improved growing conditions, especially in Mexico and portions of South America.

Processed fruit import values are raised $500 million over FY 2024 to $9.0 billion.

FY 2025 projections for fruit juice imports have raised by $200 million from the previous fiscal year forecast to $3.7 billion.

"Orange juice is the largest component of fruit juice imports and imports have increased primarily due to the long-running trend of decreased orange production in the United States. Imports from Brazil and Mexico are expected to continue to be important sources of orange juice necessary to fulfill domestic demand through FY 2025," the report says.

Additionally, the FY 2024 import forecast for horticultural products is adjusted up $900 million from the May outlook to $100.5 billion. This represents a $3.7-billion, 4-percent year-over-year increase. 

U.S. imports from the Western Hemisphere in FY 2024 are forecast at $121.8 billion, up 5 percent from FY 2023 and $400 million above the May forecast. Growth in U.S. imports from the Western Hemisphere are supported by strong imports of horticultural products such as processed food and beverages and fresh fruits from Mexico,

Import growth from Mexico for FY 2025 is projected up 4 percent over FY 2024 at $49.9 billion, driven by strong domestic demand for fruit and vegetable products.