The U.S. agricultural trade deficit is projected to hit a record $45.5 billion in 2025, driven by rising imports of fruits, vegetables, coffee, beef and other goods, according to the latest USDA Outlook for U.S. Agricultural Trade report. This figure is higher than the USDA’s forecast of a $42.5 billion deficit in the August report.
The report projects agricultural exports for the fiscal year 2025—from Oct. 1, 2024, to Sept. 30, 2025—to be $170 billion, up $500 million from the August forecast. According to USDA, the increase is primarily driven by increased dairy and livestock exports in fiscal year 2025 by $700 million, reaching $39.3 billion, due to growth across most categories.
U.S. beef exports are expected to rise by $400 million to $8.8 billion, with higher shipment volumes compensating for lower prices. Dairy exports are forecast to increase by $300 million to $8.4 billion, driven by enhanced price competitiveness for skim milk powder, whey, cheese and butter products.
Pork exports are set to grow by $100 million, reaching $7.5 billion, reflecting strong global demand and improved U.S. export prices. The combined export value of beef and pork variety meats is forecast to hold steady at $2.2 billion, as gains in beef variety meat exports balance declines in pork. Exports of hides and skins are anticipated to decline by $100 million, reflecting reduced global demand for leather products and a decrease in U.S. cattle slaughter.
USDA projects grain and feed exports for fiscal year 2025 to reach $36.5 billion, an increase of $200 million from the August forecast, driven by higher corn and sorghum exports that outweigh declines in wheat and feed and fodder shipments. In contrast, oilseed and product exports are forecast to decline by $500 million to $33.5 billion, reflecting reduced volumes of soybeans and peanuts. Ethanol exports are also revised down by $100 million to $4.2 billion, as declining unit values offset marginally higher export volumes.
Imports
The agency projects U.S. agricultural imports for fiscal year 2025 to reach $215.5 billion, an increase of $9.3 billion from the $206.2 billion recorded in fiscal year 2024 and $3.5 billion higher than the August forecast. This growth is attributed to a wide range of products, including horticultural goods, alcohol, meat, coffee, sugar and tropical products.
Livestock, poultry and dairy imports are expected to rise by $700 million to $30.3 billion, with increases across all categories except live cattle, which remain unchanged. Beef imports are forecast to grow by $400 million to $11.3 billion, driven by tight domestic supplies.
Pork imports are anticipated to increase by $100 million, with higher values offsetting slightly lower volumes, as high-value pork from the European Union continues to capture a significant share of the U.S. market. Dairy imports are projected to rise by $100 million to $5.7 billion, reflecting higher demand for imported cheese and butter amid moderate growth in domestic milk production.
USDA forecasts oilseeds and product imports to rise by $100 million from August estimates, reaching $20.6 billion, a 3% increase from fiscal year 2024. Growth is expected to be driven by solid demand for vegetable oils, with import values revised to $15.8 billion and volumes projected to increase by 500,000 metric tons, particularly for canola, processed oils and palm oil. High demand for biofuel feedstocks, including processed oils like used cooking oil, continues to support imports, which accounted for 17% of vegetable oil import value in 2024.
Mexico/Canada
President-elect Donald Trump said on social media platform Truth Social he would impose a 25% tariff on products coming from Mexico and Canada through an executive order on the first day of his administration unless the countries stem the flow of drugs and illegal immigrants into the U.S. Such tariffs could potentially lead to retaliatory measures from Mexico and Canada.
Mexico President Claudia Sheinbaum said retaliatory tariffs could be imposed, but she is open to negotiations. Canadian Prime Minister Justin Trudeau flew to Mar-a-Lago after Thanksgiving, where talks were “centered on collaboration and strengthening our relationship.” Both leaders said the tariffs will harm all three nations.
The report noted exports to Mexico, the U.S.’ top agricultural market, are projected at $29.9 billion, driven by strong demand for beef, pork, dairy and produce. Canada, similarly, is set to achieve a record $29.2 billion in U.S. agricultural imports, bolstered by increased demand for beef and horticultural products.
On the import side, Mexico maintains its position as a significant supplier to the U.S., with agricultural imports valued at $49.9 billion. These include processed foods, beverages and various livestock products, with anticipated improvements in Mexico’s growing conditions expected to sustain this trend.
Similarly, Canadian imports, projected at $42.5 billion, reflect strong trade in prepared foods, grain products and horticultural goods, alongside substantial contributions from livestock and dairy imports. — Charles Wallace, WLJ contributing editor
