AGEC 450 International Agricultural Trade

1
AGEC 450 International Agricultural Trade

• Slides for Week 2
• (includes updated figures and tables for Chapter
  1)

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Results from Quiz 1
Distribution of results Distribution of results
Score Number of People
0-10 0
11-12 1
13-14 8
15-16 16
17-18 16
19-20 0
Total 41
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Answers to Quiz 1

• In AGEC 450
• 1. there is no final exam, but only a course
  project. T F
• 2. the course project is to be presented orally
  to the class T F
• 3. the course project is to be submitted as a
  written report T F
• 4. the presentation(s) of the course project is
  (are) subject to strict limits on length T F
• 5. the in-class quizzes all count equally, so
  students must complete all of them T F
• Note logic problem what is the correct answer
  to this question?
• In world agricultural trade, since the 1970s
• 6. The dollar value of world agricultural trade
  has risen in every decade T F
• 7. The value of trade in nominal dollars could
  have risen due to inflation alone T F
• 8. The value of ag. exports from the U.S. is
  more variable than exports from Europe T F
• 9. The value of ag. exports from the U.S. has a
  similar trend to exports from Europe T F

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Quiz 1 (continued)

• In the United States, since the 1970s
• 10. Agricultures share of consumer expenditure
  has declined T F
• 11. Agricultures share of total output (GDP) has
  declined T F
• 12. Agricultural exports have risen T F
• 13. The share of bulk commodities in U.S.
  agricultural exports has fallen T F
• 14. The value of bulk commodities exported has
  fallen T F
• 15. The value of bulk commodities exports are
  more variable than other ag. exports T F
• 16. The merchandise trade deficit (value of
  exports minus imports) has grown T F
• 17. The value of merchandise imports has risen T
  F
• 18. The value of merchandise exports has fallen
  T F
• 19. The agricultural trade surplus (value of
  imports minus exports) has grown T F
• 20. The agricultural trade surplus varies due to
  fluctuation in agricultural imports T F

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Questions for the semester ahead...

• About the whole economy
• How the economy affects agriculture
• How agriculture affects the rest of the economy
• How other countries perceive the U.S.
• How the U.S. can help other countries
• In what time frame do prices affect business,
  consumers?
• Is there great potential for the future of
  agriculture?
• What does the future look like?
• Is society completely dependent on trade?
• Can we rely on goods from other countries?
• What happens when trade is increased?
• Is it possible to fix the deficit?
• Why society/economy does what it does.

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Questions for the semester ahead...

• Career skills
• Understanding of trade, agriculture
• Ability to work in sales, marketing, production
• Interpreting foreign markets
• Dealing with businesses from foreign countries
• I need to be able to understand why we do what
  we do.
• Other objectives for this class
• How international trade affects me personally
  family city state country
• Make fun and interesting, real data and current
  events
• Humor!
• I like real life applications and examples
• Applicable and practical is a must

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In sum why take this course?

• Why agricultural trade?
• Why economics of agricultural trade?

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Whats happening to world ag. trade?
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Whats happening to world ag. trade?
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Who are the ag. exporters? Why?
Income per person, 1995 (with sub-national data
for 19 countries)
Source Sachs, JD, Tropical Underdevelopment.
NBER Working Paper 8119. Cambridge, MA NBER.
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Agricultural Employment as a Share of Civilian
Employment and Real Farm Output as a Share of
Real GDP
SOURCE U.S. Department of Commerce and the
Federal Reserve Bank of St. Louis. Reprinted
from K.L. Kliesen and W. Poole, 2000.
"Agriculture Outcomes and Monetary Policy
Actions Kissin' Cousins?" Federal Reserve Bank
of Sf. Louis Review 82 (3) 1-12.
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Food Expenditures as a Share of Total Consumer
Expenditures in the US
Source K.L. Kliesen and W. Poole, 2000. " Agriculture Outcomes and Monetary Policy Actions Kissin' Cousins?" Federal Reserve Bank of St. Louis Review 82 (3) 1-12.
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(No Transcript)
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(No Transcript)
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Table 1.1 U.S. Merchandise Exports and Imports
Since 1950, Selected Years, in billion
dollars. Exports Imports 1950 10.3
8.9 1955 15.5 11.3 1960
20.4 15.1 1965 27.2
21.4 1970 42.6 40.0 1975
107.7 98.5 1980 216.7
244.9 1985 206.9 345.3 1990
393.6 495.3 1995 584.7
743.4 2000 772.0 1,224.4 2004 1,151.4
1,769.0 Source U.S. Bureau of Census
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Table 1.2 U.S. Agricultural Exports and Imports
Since 1950, Selected Years, in billion
dollars. Exports Imports 1950 3.4
5.1 1955 3.5 4.1 1960 4.5
4.0 1965 6.1 4.0 1970
6.7 5.6 1975 21.9 9.3 1980
41.2 17.4 1985 29.0 20.0 1990
39.4 22.8 1995 56.2 30.1 2000
51.2 39.0 2004 62.3 52.7 Source
Economic Research Service, U.S. Department of
Agriculture
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Table 1.3 Leading Agricultural Exporters, in
billion dollars, 2003. Country Value of
Exports United States 62.3 France 42.1 Neth
erlands 41.9 Germany 32.8 Belgium-Luxembourg
22.6 Spain 21.4 Brazil 20.9 Italy 2
0.6 Canada 17.6 United Kingdom 17.2 E.U.-15
62.6 World Total 522.2 Source FAO
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Table 1.4 Leading Agricultural Importers, in
billion dollars, 2003. Country Value of
Imports United States 53.5 Germany 45.6 Japa
n 37.0 United Kingdom 35.1 France 30.7 I
taly 26.8 Netherlands 25.1 Belgium-Luxembou
rg 20.2 China 23.5 Spain 16.3 E.U.-15
68.2 World Total 548.5 Source FAO
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Table 1.5 U.S. Agricultural Exports by Major
Products, 2004 in billion dollars. Product Value
of Exports Soybeans 6.67 Coarse
Grains 6.45 Wheat 5.09 Cotton
4.25 Red Meat 2.81 Fresh Fruit
2.39 Processed Fruits and Vegetables
2.35 Poultry Meat 2.17 Tree Nuts
2.03 Total 61.38 Source Economic Research
Service, U.S. Department of Agriculture
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Table 1.6 Leading Destinations for U.S.
Agricultural Exports, 2004, in billion
dollars. Product Value of Exports from
U.S. Canada 9.74 Mexico
8.49 Japan 8.14 Peoples Rep of China
5.54 Korea 2.49 Taiwan
2.06 United Kingdom 1.16 Germany
1.16 Netherlands 1.10 Turkey
0.94 (E.U.-25 6.79) Total
61.38 Source Economic Research Service, U.S.
Department of Agriculture
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Table 1.7 U.S. Agricultural Imports by Major
Products, 2004, in billion dollars. Product Va
lue of Imports Wine and Beer 6.19 Red
Meat 4.93 Snack Foods 4.13 Fresh
Fruits 3.77 Processed Fruits and Veg.
3.54 Fresh Vegetables 3.36 Vegetable
Oils 2.15 Essential Oils 2.02 Raw
Coffee 1.64 Rubber
1.47 Total 53.98 Source Economic
Research Service, U.S. Department of Agriculture
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Table 1.8 Leading Origins for U.S. Agricultural
Imports, 2004, in billion dollars. Country Valu
e of Imports to U.S. Canada
11.45 Mexico 7.26 Australia
2.49 Italy 2.30 Ireland
1.96 Netherlands 1.94 France
1.74 Brazil 1.66 P.R. China
1.62 New Zealand 1.60 Indonesia
1.49 Chile 1.34 Colombia
1.16 (E.U.-25 12.33) Total
53.98 Source Economic Research Service, U.S.
Department of Agriculture