Bernadette Wiltz, SUSTA
In collaboration with World Perspectives, Inc.
Every February the U.S. Department of Agriculture (USDA) releases its 10-year baseline projections for agriculture, typically in conjunction with the Ag Outlook Forum. This year’s forum will be held February 22-23, 2018 and is entitled “The Roots of Prosperity,” which for Southern exporters is global demand. Indeed, in addition to forecasts on commodity supply and demand, the USDA’s 2018-2027 baseline projections will include a full discussion of projections for global trade and economic trends and conditions.
This month, USDA released the preliminary estimates of their long-term forecast, using the market and trade data collected through the first 10 months of 2017 as a starting point. The early release projections give a promising glimpse of the global market in the coming decade. Global GDP is projected to grow an average of 2.9 percent per year over the next 10 years – faster than the 2.3 average annual rate experienced over the past 10 years.
As the chart above shows, the forecast over the next 10 years is for higher economic growth than the last 10 years in most all regions. The exceptions are Oceana, where future growth is still pegged at a healthy 2.5 percent, and in Asia, which is still the highest growth region in USDA’s forecast. Asia’s growth is down slightly over the past 10 years in part because of China slowing down from its red-hot growth rate of more than 8 percent to a still robust 5.5 percent. The most important point, however, is that positive economic growth is expected in all regions were SUSTA’s export promotion activities take place.
Another key indicator for the future found in the USDA’s preliminary numbers is the growth trend in global population. The four fastest growing regions – Asia, Africa, the Middle East and Latin America – are also the regions which will see the greatest population growth, ranging from an annual average of 0.8 percent in Latin America to 2.2 in Africa.
Population and economic growth are the drivers of world food and agricultural trade. More people with more economic means demand more products. Southern U.S. companies committed to the long-term opportunities through a carefully executed global marketing strategy, supported by SUSTA and the USDA’s Market Access Program (MAP), stand to benefit from these global trends – and SUSTA will continue supporting small businesses who want to connect with the more than 95 percent of the world’s potential customers who live outside of the U.S.