Fear Oil #2 11/20/76

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Fear Oil #2 11/20/76 - USDA PREDICTS 6.5 MILLION TON DROP IN EXPORTS...
USDA PREDICTS 6.5 MILLION TON DROP IN EXPORTS PLANNERS Continued from Page One dation of OPEC economic experts, who were meeting there. The Journal said some hardliners, including Iran, are expected to demand a 25 per cent increase. Previously Optimistic on Exports The USDA up to now has been optimistic in its forecasts of 19^7, American agricultural.exports, saying the dollar volume will remain about the same hext"ye^iir r 'aii" in W76» However, the department has predicted that U.S. agricultural imports will increase, so that the net agricultural trade balance wull drop from the current $12.2 billion surplus to $10.8 billion. This favorable balance in farm trade had been paying for about one-half of this country's imported oil bill in the three-years- since the oil exporting countries drastically increased petroleum prices. This could drop to about one-fourth if oil prices are increased and American farm exports suffer, USDA experts say. Assistant Agriculture Secretary Richard Bell told the department's annual outlook conference this week that "forecasting exports of U.S. agricultural products is perhaps more hazardous than usual this year because of the weak financial positions of a number of countries and, in particular, the uncertainty related to a possible increase in petroleum prices by OPEC ,, Bell added, "many economists believe that a substantial increase in petroleum prices at this time would be more dangerous to the world economy in general — and could have a more adverse impact on agricultural exports --=_than-wa8-tbe-case-three-years-ago when the OPEC first raised prices." USDA officials said that since the big increase in prices three years ago, a number of countries which buy large quantities of U.S. farm products have incurred large foreign debts, and are moving to cut their purchases. These include Great Britain, Italy, Denmark and France. At the same time, the world grain supply situation has eased considerably with large crops in North America and in the Soviet Union. Thus, foreign demand for American grain has slackened and 1977 corn, wheat and soybean exports may drop by about 6.5 million tons, the USDA says. However, higher prices for soybeans, oilseed products and cotton, it is believed, will allow the U.S. to maintain its present $22.8 billion dollar volume on exports. Helping to-strengthen the U.S. export situation will be the,demand created by last summer's European drought, as well as the increased need for feed grains in some developing countries which are providing more livestock products for their citizens. Also, the Soviet Union, which has bought 8.4 million tons of U.S. grain this year, will continue to purchase U.S. grain under a five-year agreement signed in 1975. Japan, whose economy has recovered significantly from earlier depressed levels, is expected to continue to be this country's top agricultural customer. least free

Clipped from
  1. The Des Moines Register,
  2. 20 Nov 1976, Sat,
  3. Page 4

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