By Emmy Powell
Communications Specialist

The U.S. Department of Agriculture (USDA) is projecting the U.S. agricultural trade deficit will have the largest increase on record in fiscal year 2025.

Imports have been growing faster than expected, further widening the trade deficit.

USDA estimates agricultural exports for fiscal year 2025, which began Oct. 1, will fall to $170 billion from $174.4 last year.

The trade outlook “confirmed once again that both fiscal years 2024 and 2025 are going to be record trade deficits in agricultural products,” Betty Resnick, American Farm Bureau Federation economist, said. “USDA currently projects the third year in a row of declining exports by value, which combined with continuously climbing imports, exasperates the ag trade deficit.”

Beef, dairy, corn, sorghum and fruits and vegetable exports were revised upward from previous estimates. In global markets, corn and sorghum prices are higher than expected, and increased beef export volumes help offset declining prices.

Exports to Asia are expected to fall. Chinese buyers are forecast to buy $23.3 billion worth of U.S. agricultural goods this year, which is down $2.4 billion from 2024.

Because of horticultural products, sugar and tropical products, USDA expects U.S. imports to be $215.5 billion, up $9.5 billion from fiscal year 2024 and $3.5 billion more than the agency projected in August.

USDA anticipates orange juice prices will remain elevated and import values will remain robust after damage from hurricanes Milton and Helene.

Vegetable imports from Mexico are expected to increase and the value of U.S. coffee imports to rise, USDA noted.

A $1 billon increase in vegetable oil imports is expected due to U.S. demand for biofuels and improved conditions for olives in Europe.

Since 2019, the U.S. has faced an agricultural trade deficit in four of the last six years. In 2019, an agricultural trade deficit began after China responded to tariff hikes introduced by then-President Donald Trump by imposing new tariffs on U.S. ag exports and ending a decades-long U.S. trade surplus.

The 2024 trade deficit of $32 billion was the largest on record.