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Texas: U.S. Ag Trade Fueled by Demand, Steady Yields

Ernst Undesser
By Blair Fannin, Texas AgriLife Extension December 6, 2017

Texas: U.S. Ag Trade Fueled by Demand, Steady Yields

Flags of Mexico and the United States of America. Photo: David Carillet1

U.S. agricultural exports value totaled $135 billion in 2016 and experts anticipate future growth if production yields, trade agreements and borrowing power work in lockstep.

“Trade is very, very important,”  Dr. Luis Ribera, Texas A&M AgriLife Extension Service economist in College Station, told attendees at the Texas Plant Protection Association Conference Dec. 5 in Bryan. “That $135 billion is huge.”

Ribera said U.S. agricultural imports were valued at $115 billion in 2016.

“As you can see, both imports and exports generate positive economic impacts,” he said. “Overall, when you look at what we export, we are really good at producing corn and cotton as well as several other commodities. The winners are consumers. We have a year-round supply of everything you can think of, and we can get it from the around the world even if it’s not in season.”

Ribera said trade agreements play a pivotal role in being the driving force of both import and export activities. When comparing North American Free Trade Agreement from 1994 to 2016, there was a 192 percent increase in total U.S. agricultural exports. Mexico plays a large role in the U.S. export market.

Imports from Mexico are also prominent, Ribera said.

“Vegetables are the largest share of imports from Mexico due to seasonality,” Ribera said. “The good news? We can get year-round supplies of vegetables. What is good for us is good for Mexico as well. It helps their economy do well and helps our economy here in Texas.”

Ribera said more than 19,000 jobs have resulted from Texas’ export trade to Mexico. He noted in 2016 alone there were more than 464,000 trucks of produce coming in from Mexico to Texas.

“Imports have been a positive on our economy,” he said. “With regards to agricultural imports from Mexico, tomatoes have been the most popular item. Mexico has made a large investment in greenhouse facilities because we are willing to pay-up for nice, big red tomatoes.”

Storage infrastructure continues to be expanded in the Valley region of Texas as 80 percent of cold storage facilities are located there, he said.

“NAFTA has been good,” he said. “This trade is not the U.S. government buying from the Mexican government. You have to realize this is business to business. You have years and years of relationships that have been established.”

Dr. Mark Hussey, vice chancellor and dean of the College of Agriculture and Life Sciences at Texas A&M University in College Station, opened the conference discussing the importance of trade agreements and how they will weigh heavily in producing enough food and fiber to meet a global population expected to reach more than 9 billion by 2050.

“It’s going to require that we have new partnerships not only public and private, but domestic and globally,” he said. “We also are going to need greater awareness of food and fiber production systems.”

The conference continues through Dec.  6, featuring presentations from representatives throughout the Texas agricultural industry.

Ernst Undesser
By Blair Fannin, Texas AgriLife Extension December 6, 2017