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Global surplus, strong dollar weigh on U.S. ag exports

U.S. ag export demand is suffering from excess global supplies and a strong U.S. dollar.

CoBank economist Tanner Ehmke says there is a surplus of grain globally.

“You’ve got record crops down in South America, corn and beans. You’ve got record crops in the Black Sea (region) with Russia. And then we have a strong dollar on top of all that.”

He tells Brownfield domestic demand, especially for soybean oil, has helped support commodity prices.

“But the fact is we’re still in a world with a surplus of agricultural commodities, so as a result that’s why we’ve seen the ag sector see a bit of a dislocation when all these other commodities are going up.”

Ehmke says U.S. consumers continue to spend despite inflationary pressure, which is keeping the value of the dollar elevated.