KEY POINTS
- The United States is now on pace to reach a $39 billion agricultural trade deficit in 2024 amid all-time record imports.
- Despite a steady trade surplus in grains and oilseeds, the U.S. faces widespread agricultural trade deficits across all other products
- U.S. meat/seafood trade deficit has reached $19.5 billion
- U.S. fruit trade deficit reaches $12 billion and vegetables reaches $4.8 billion, whereas in the 1970s, the U.S. was a net-exporter of fruits and vegetables
- Beef, seafood, tomatoes, berries, potatoes, and onions seeing largest trade deficit declines in the past decade
- Highest agricultural trade deficit with Mexico ($17.2 billion) and Canada ($11.5 billion)
From Breadbasket to Net Importer
For much of its history, the United States has been a global agricultural breadbasket, exporting vast quantities of grains, meats, and produce to countries worldwide. However, over the past decade the U.S.’s long-standing agricultural trade surplus has now flipped. 2024 agricultural imports are now at an all-time high, and the overall U.S. agricultural trade deficit is the worst in history.
As shown in Figure 1, since the beginning of the U.S. Department of Agriculture’s trade data in 1967, the United States has maintained agricultural imports steadily below exports despite rising levels of both. However, this balance closed in the late 2010s, and imports have now soared above exports in the past two years.
FIGURE 1:
This shift has made the United States a net agricultural importer by a wide margin in just the past few years. As shown in Figure 2, the U.S.’s trade balance since 1967 has varied but always remained healthily positive. As recent as 2014, the U.S. maintained a nearly $35 billion agricultural trade surplus. However, by 2019, the U.S. was in an agricultural trade deficit. In 2023, this deficit surged to over $21 billion. And in 2024, the United States is now on pace to reach a $39 billion agricultural trade deficit, the worst in our history. This 2024 deficit is larger than any trade surplus year besides 2011.
FIGURE 2:
Highest Agricultural Trade Deficit with Mexico and Canada
Broad trade liberalization through agreements such as the Uruguay Round of GATT negotiations and many other free trade agreements have steadily diminished U.S. agriculture’s position and given up vast market share to imports. Currently, the largest agricultural trade deficits for the United States are with Mexico and Canada. These two countries are vivid examples of how trade liberalization has led to worse trade deficits for U.S. agriculture. Agricultural trade with Mexico and Canada has been extensively liberalized through trade agreements such as the North American Free Trade Agreement (NAFTA), effective 1994, and most recently, the U.S.-Mexico-Canada Trade Agreement (USCMA).
USMCA came into effect in 2020 and carried over all the zero tariffs rates for agricultural products from NAFTA. USMCA also introduced additional market access for foreign agricultural imports in exchange for U.S. export access. For example, the U.S. granted Canada additional market access for dairy, peanuts, processed peanut products, and sugar products (1). However, this trade in U.S. agricultural market access in an effort to benefit exports backfired.
According to U.S. Department of Agriculture trade data, in the aftermath of the USMCA agreement, the U.S. agricultural trade deficit with Mexico expanded by $9.7 billion from 2020 to 2024. And the agricultural trade deficit with Canada increased by $3.8 billion during the same time period (2).
As shown in Figure 3, the U.S. is on pace for a $17.2 billion agricultural trade deficit with Mexico and a $11.5 billion agricultural trade deficit with Canada in 2024. The U.S. also has major agricultural trade deficits with South American countries such as Brazil, Peru, and Chile, as well as European countries like Italy, France, and Ireland. Meanwhile, the United States’ trade surpluses with countries in East Asia, most notably with China (at $16.8 billion), as well as Japan and South Korea, fail to make up the deficit losses elsewhere.
FIGURE 3:
U.S. Only Maintaining Agricultural Trade Surplus in Grains & Oilseeds
The U.S. agricultural trade balance picture is very stark across different product categories, with only a few select agricultural products holding up total exports.
As shown in Figure 4, the U.S. has maintained a strong trade surplus for grains and oilseeds over the past two decades. This surplus has also grown overall. The grains and oilseeds trade surplus increased from $14.9 billion in 2002 to $44 billion in 2024.
FIGURE 4:
However, as shown in Figure 5, the grains and oilseeds trade is dominated by just a few products generating nearly all the trade surpluses by total value. These include soybeans ($22.7 billion surplus), corn ($13.8 billion surplus), and wheat ($5.3 billion surplus). These three products alone account for about 95% of the U.S.’s total trade surplus in 2024.
FIGURE 5:
The high trade surplus in soybeans is a growing development over the past decade. Figure 6 below shows the top U.S. cereal exports by volume. U.S. soybean exports reached significant levels in the late 2010s, surpassing traditional grain products like wheat and rivalling corn exports in volume.
FIGURE 6:
However, despite continuing trade surpluses, U.S. trade liberalization over the past decades has not substantially expanded export levels for most grain products such as corn, wheat, and rice. In fact, wheat exports are currently below what they were in 2000. This further shows the failings of trade liberalization over the past 20 years in increasing export opportunities for even the biggest agricultural export sectors, while the consequences for all other agricultural sectors has been substantial trade and market share losses.
As shown in Figure 7, the agricultural trade deficit ranges across a wide range of product groups. The largest deficits are for Food Products ($33.7 billion), Beverages & Tobacco ($22.9 billion), and Meat & Seafood ($10.9 billion). Even products like Fruits and Vegetables, where the U.S. used to have a trade surplus, now have amassed large and worsening trade deficits, at $12.1 billion and $4.8 billion respectively.
FIGURE 7:
Worsening Beef/Seafood Trade Deficit Outweighing Gains in Chicken/Pork
Despite the U.S. trade surplus in grains and oilseeds, all other agricultural product categories such as livestock/meat, seafood, fruit, vegetables, beverages, tobacco, and food products have all seen large and widening trade deficits as previously shown in Figure 4. The trade deficit for meats and seafood, for example, has worsened substantially over the past decades.
As shown in Figure 8, the largest contributors to this deficit are beef, fish, and other seafood (such as crustaceans). The U.S. had a surplus in beef trade as recently as 2022 at $1.96 billion. However, just like the U.S. agricultural trade balance as a whole, this surplus has turned into an increasingly large deficit, with the beef trade deficit reaching $190 million in 2023 and forecasted at a $1.68 billion deficit in 2024. Meanwhile, U.S. fish and seafood trade has long been at a substantial deficit despite the huge potential of U.S. fish/seafood production (3). The fish/seafood deficit has also worsened significantly in recent years, forecasted to reach a $20.3 billion deficit in 2024, compared to just $7 billion in 2000.
FIGURE 8:
The strong points for U.S. meat trade have been chicken and pork. The U.S. has maintained its trade surplus for these products, with the trade surplus in pork at $5.1 billion in 2024, and the trade surplus in chicken at $4.5 billion. However, despite these surpluses export growth has not kept pace with imports, and the trade surplus for poultry has even fallen by 10% since 2012. Moreover, U.S. meat/seafood trade balance as a whole has been on the decline. In total, the U.S. meat/seafood deficit is forecasted to reach $10.9 billion in 2024, a stark reversal from the $198 million surplus height in 2012.
As shown in Table 1, the U.S. trade balance for live animals is similar to the balance for meats. The largest trade surplus is for live chickens (16.3 million) and one of the largest trade deficits is for live cattle (2.15 million). However, the starkest difference is for swine. While the U.S. has a 637,000 ton trade surplus for pork, the U.S. has a 6.7 million ton trade deficit in live swine.
Table 1: 2024 U.S. Live Animal Trade Balance
Product | 2024 Trade Balance (number of animals) | Trade Balance Change since 2000 |
Live Poultry | 16,339,766 | -24,958,893 |
Live Sheep | 2,002 | -327,707 |
Live Horses/Mules | -21,991 | 211,400 |
Live Buffalo | -34,235 | -30,322 |
Live Cattle | -2,149,694 | 22,112 |
Live Swine | -6,745,152 | -2,408,987 |
Source: U.S. Census Bureau
U.S. Maintains Trade Deficit in All Fruit & Vegetable Product Categories
Even though certain meat/seafood product sectors have managed to maintain a trade surplus, this has not been the case for fruit and vegetables. The U.S. now has a trade deficit in all major fruit and vegetable product categories.
As shown in Figure 9, in 2024, the U.S. had a trade deficit for all fruit products. The largest deficits are for many tropical fruits. These include bananas (5.3 million ton deficit), pineapple (1.4 million ton deficit), and avocados (1.2 million ton deficit). Even though these are tropical fruits, the U.S. can and has produced substantial quantities of these products. For example, Hawaii used to have a booming pineapple industry and California maintains substantial avocado production. Moreover, greenhouse technology is making it increasingly economical to produce any agricultural products in any climate (4).
FIGURE 9:
The U.S. also has large and widening trade deficits for many fruits that have traditionally been produced widely domestically. For example, the U.S. has substantial trade deficits in apples (91,000 tons), blueberries (282,000 tons), strawberries (418,000 tons), and watermelons (858,000 tons). These trade deficits have also increased significantly over the past decade. Since 2014, the trade deficit for watermelon has increased by 31%, the deficit for strawberries by 59%, and the deficit for blueberries by nearly 200%.
The trade picture is even worse for vegetables. As shown in Figure 10, the U.S. also has a trade deficit for all major vegetable product categories, all of which can be produced domestically. These major deficits include cucumbers/gherkins (1.7 million ton deficit), onions/shallots/leeks/garlic (834,000 ton deficit), and potatoes (503,000 ton deficit). Furthermore, nearly all vegetable products have seen large negative trade shifts in recent years. For example, some of the largest negative deficit shifts since 2014 have been mushrooms (98%), and celery (108%), and Cabbage/Cauliflower/Kale (118%).
FIGURE 10:
However, the largest vegetable trade deficit is for tomatoes. The U.S. has a 1.9 million ton trade deficit in tomatoes. This trade deficit has risen by 581,000 tons since 2014 (43%). The staggering deficit in tomato trade is another example of the failing of current U.S. trade policy. In order to try to protect the U.S. tomato market from imports, the United States negotiated the Tomato Suspension Agreement (TSA) with Mexico, which went into effect on September 19, 2019. This agreement with Mexico aimed to ensure “exporters sell Mexican tomatoes at or above the TSA reference price to eliminate the injurious effects of exports of fresh tomatoes to the United States.” However, this has done nothing to stem the import surge.
As shown in Figure 11, Mexico’s share of total U.S. tomato imports has remained at about 90% since the agreement was signed, and total tomato imports from Mexico have actually increased by 252,000 tons (15%) since 2019. This demonstrates the weakness of negotiated agreements like the TSA, which has no mechanism to stop the import of tomatoes sold for less than the minimum floor, and the vital need for hard quotas and/or tariffs.
FIGURE 11:
Finally, the U.S. also has extensive trade deficits for processed foods. As shown in Figure 10, the U.S. had a 2.1 million tons trade deficit in bread, pastries, and cake. The U.S. also has large trade deficits for frozen potato products such as fries (nearly 700,000 tons), sauces (590,000 tons), and jams (250,000 tons). In addition to the data in Figure 12, the U.S. also has a 4.9 billion liter trade deficit in fruit, nut, and vegetable juices.
FIGURE 12:
Trade Balance Shifts Leading to Consolidation
The worsening U.S. agricultural trade deficit is already having a substantial impact on domestic producers. Net farm income dropped among row crop farmers in 2024, and 2025 is forecasted to see continuing negative margins. Most agricultural economists are also now indicating that the U.S. agriculture sector is in a recession (5).
Most agricultural economists also project that the current agricultural trade and market conditions and a reliance on just a few specific export products will lead to increased market consolidation. Low agricultural commodity prices pushed down by record import levels combined with high input costs, will force the most vulnerable small farms out of the market and lead to increased consolidation around the corporate agricultural giants (6).
Indeed, this consolidation has been the overarching trend of the U.S. agricultural industry over the last three decades as outlined by a comprehensive USDA study (7). The study outlined a clear and substantial shift of sales from small- and mid-sized farms to large-scale farming operations. In 1987, small farms accounted for 37.2% of market value of agricultural products sold, and just 14.5% in 2012. Conversely, large-scale farming operations increased their total market share from 38.3% in 1987 to 66.4% in 2012 (8).
With trade surpluses increasingly dominated by a few select crops such as soybeans, corn, and wheat, large agricultural giants who specialize in the production of these crops have gained substantial market share. These giant firms are the primary agricultural exporters while small family farms are overwhelmingly domestic focused. The corporate agricultural giants can also cope with lower commodity prices pushed down by surging imports far better than small-scale farms can, who are facing an onslaught of zero-duty imports. And the primary losers of this policy have been local small family farms.
The agricultural trade deficit has also been exacerbated by the high and rising U.S. dollar value. The U.S. dollar is now at a 2-year high (9), which has made imports increasingly cheaper (essentially subsidizing foreign goods) while making U.S. exports less competitive in foreign markets. Moreover, agricultural products are also low-margin commodities and so price fluctuations caused by the U.S. dollar’s overvaluation are especially significant.
Need For Tariffs and Quotas
The vast and widespread impact of surging agricultural imports has been extremely harmful for so many U.S. farmers. Net farm income has declined in recent years as agricultural imports have soared, and the resulting consolidation has led to a continuously declining total number of U.S. farms (10). In order to stem the import surge and protect family farms, the U.S. government must take action. The most effective course of action would be to implement broad global tariffs on agricultural products coming into the United States. This will help protect local U.S. farms against imports and would boost domestic agricultural production due to the increased domestic demand.
Furthermore, quotas can also play a crucial role, especially for the countries where the U.S. has the highest trade deficits (i.e. Mexico and Canada). Quotas can often be even more effective than tariffs because they directly target and restrict volume. This provides a much clearer and established domestic market share for U.S. producers to compete in, allowing private farms to have much better domestic production planning and protections from fluctuating prices weakening tariffs.
Conclusion
The U.S.’s fall to a net agricultural importer marks a pivotal moment in its agricultural history. Within just a decade the United States reached a record agricultural trade deficit, with only a few select products holding any trade surplus. This shift shows that export gains for a few specific products and corporate giants have not made up for the wide-spread losses for all the domestically-focused family farms. Most agricultural products saw rapidly expanding trade deficits and substantial downward price pressure in the era of trade liberalization. This has only harmed most U.S. agricultural product sectors and led to a consolidation of sales and market value around large-scale farming operations.
(1) UNITED STATES–MEXICO–CANADA TRADE FACT SHEET Agriculture: Market access and dairy Outcomes of the USMC Agreement. (n.d.). United States Trade Representative. https://ustr.gov/trade-agreements/free-trade-agreements/united-states-mexico-canada-agreement/fact-sheets/market-access-and-dairy-outcomes
(2) U.S. Department of Agriculture: Global Agricultural Trade System (GATS)
(3) S.E. Lester, R.R. Gentry, C.V. Kappel, C. White, S.D. Gaines, Offshore aquaculture in the United States: Untapped potential in need of smart policy, Proc. Natl. Acad. Sci. U.S.A. 115 (28) 7162-7165, https://doi.org/10.1073/pnas.1808737115 (2018).
(4) Leroux, David, and Mark Lefsrud. 2021. ‘The Canadian Integrated Northern Greenhouse: A Hybrid Solution for Food Security’. Next-Generation Greenhouses for Food Security. IntechOpen. doi:10.5772/intechopen.96214.
(5) Morgan, T. (2024, December 16). Majority of Ag Economists say U.S. Agriculture is Ending the Year in a Recession. AgWeb: Farm Journal. https://www.agweb.com/news/policy/ag-economy/majority-ag-economists-say-u-s-agriculture-ending-year-recession
(6) Id.
(7) MacDonald, J. (n.d.). Three Decades of Consolidation in U.S. Agriculture. USDA. https://www.ers.usda.gov/webdocs/publications/88057/eib-189.pdf
(8) Id.
(9) U.S. Dollar Index (DXY). (n.d.). Wall Street Journal. https://www.wsj.com/market-data/quotes/index/DXY/advanced-chart
(10) Ag and Food Statistics: Charting the Essentials – Farming and Farm Income | Economic Research Service. (n.d.). https://www.ers.usda.gov/data-products/ag-and-food-statistics-charting-the-essentials/farming-and-farm-income
