That was the case this year when Leslie Meyer presented USDA’s cotton forecast. Meyer said USDA believes China will import 7 million bales of cotton this year. Moments later, Gary Taylor, president and CEO of Cargill Cotton, said Cargill was predicting Chinese imports of 9 million to 10 million bales.
Sometimes, the administration tries to spin the numbers. This year, Keith Collins, USDA’s chief economist, gave an optimistic U.S. economic outlook that might not be shared by all of his peers. But there was little dissent with Collins’ forecast that U.S. agriculture has a better outlook than it had at last year’s Forum.
Speaking last week, Collins predicted U.S. farm exports could reach $59 billion and might have exceeded the 1996 record of $60 billion if not for the discovery of the first case of mad cow disease in the United States.
Most Outlook Forums provide a new take on some aspect of agricultural trade. This year’s magic moment may have been Collins’ observation about the increasingly competitive nature of global commodity markets.
He noted that if you take the 2002 soybean exports of Brazil and Argentina, the coarse grain exports of China and the Former Soviet countries and the wheat exports of India and the Former Soviet countries you have a total of 85 million metric tons of grain. Those countries exported less than 10 million tons in 1994.
A close second might have been his comments on China. In 1997 or 1998, the Forum was rife with predictions of how much grain China would have to import to feed its population. Instead, China embarked on a program of self-sufficiency that made it a grain exporter.
Now China may be coming full circle, buying large quantities of U.S. soybeans and cotton. “The question, Collins said, is: “are we at the long-awaited turning point where China focuses resources on more labor-intensive crops and becomes a more sustained importer of bulk crops?”
Then, there’s Brazil. “Most people know Brazil has increased its soybean planted area by 25 million acres since the mid-1990s,” he said. “But Brazil is not just soybeans. They have increased production of cotton, soybeans, broilers, pork, corn and beef by 25 to 75 percent since the late 1990s.
“While I am portraying a positive economic picture for U.S. production agriculture in 2004,” he said, “that optimism should be tempered by potential consequences of the continued production growth of Brazil and other emerging competitors.”
Cargill’s Taylor, who gave a cotton merchant’s perspective on China, also offered this take-home nugget: “It doesn’t matter what the United States does to reduce textile imports from China – they (Chinese manufacturers) will just move to Indonesia (or some other low-cost labor country.)”