U.S. farm exports to Asia may fall further

U.S. farm exports to Asia may fall further

CHICAGO (Reuters): U.S. agriculture exports to Southeast Asia this fiscal year may drop by more than the US$500 million the U.S. Agriculture Department estimated last month, U.S. Agriculture Department Deputy Chief Economist Joseph Glauber said Tuesday.

"The situation since Dec. 2 has worsened a bit. I would expect a revision downward in terms of exports to that region," Glauber told a Chicago Board of Trade economic outlook conference. He said his forecast assumed no further increases in USDA-issued GSM-102 export credits.

On Dec 2, the USDA estimated U.S. farm exports at $58.5 billion for the current fiscal year. The economic crisis in Southeast Asia was expected to trim sales to that region by $500 million, the USDA said then.

Since December, the USDA has approved $1 billion in GSM credits to South Korea. Credits available to Southeast Asian countries swelled to more than $1 billion on Monday when USDA extended an additional $545 million in loan guarantees to help the financially troubled region buy U.S. farm goods.

The credits announced Monday included a new $100 million export credit line for Malaysia, and increases in existing credit lines to Indonesia, Thailand and the Philippines.

Glauber said the GSM credits may prompt some Asian grain purchases but not enough to raise U.S. prices.

Exports of U.S. farm goods to East Asia have shrunk dramatically in the current marketing year, which began on Sept. 1. As of Dec. 25, according to USDA figures, South Korea had bought 789,900 tons of U.S. corn in the current season compared with 2.421 million a year ago. Indonesia had bought no corn, versus 103,000 tons a year ago, and Malaysian had bought 52,000 tons compared with 438,200 a year ago.