An Overview of the U.S. Commodity Exports Industry

The commodity exports of the United States are as vast as the natural resources the nation contains. It can be said that the bounty of the land has allowed the United States to become the preeminent economy of today. Although commodity exports provide only approximately 7 percent of the GDP (in 2010), the American economy was well positioned to have become the power that it is today due to its rich abundance in various types of commodities. 

Agricultural Exports

It is interesting to note that although the United States lags behind China and India in terms of total agricultural exports, in 2007, these US exports produced $78 billion. Agriculture is less than 1 percent of the GDP, yet this figure shows that, contrary to popular belief, the country can still be considered high in agrarian economy. Furthermore, the nation is home to many of the commodity exchanges that handle commodity trading. Domestically and internationally, markets in New York, Chicago and Kansas City trade millions, if not billions, of dollars in everything from soybeans to hogs and cattle. This helps to establish pricing in commodities that are traded, and by extension, it also helps producers to see pricing trends in products they are looking to bring to market. In any given year, about 25 percent of all production is exported, mostly to Asia, but in recent years, Canada and Mexico have picked up increasing shares of exports. It is safe to say that the agricultural industry, with increased demand and, thus, higher prices will likely continue to remain healthy and growing.

Metals, Energy and Others

The United States is unique in that although it is the largest consumer of energy in the world, it is also one of the largest producers. It ranks third after Saudi Arabia and Russia in oil production, producing 8.5 million barrels per day. It also possesses nearly 30 percent of the world’s coal, thus making the United States a potential coal powerhouse. Other commodities such as precious metals, lumber and steel continue to be exported from the United States, albeit at a smaller rate than in previous years. This is partly due to the decline of domestic manufacturing and service support jobs, some 15 million since 1999. However, the trend is on the verge of reversing, ironically enough, due to the higher costs of energy. A clear picture on this trend is still many years off.   

Future Trends

With the steady increase in population worldwide, there will continue to be a high demand for US goods and services. There is no doubt that the export of US commodities will continue to remain at a high level. Even as other players step onto the world stage, it remains to be seen how the technological skills and the abundance of the United States will be matched. American productivity remains high in spite of the global recession and will continue to remain so, especially with a looming labor demographic crisis that others such as Russia, the EU, China and Japan will be facing. With a well planned trade and human resources development program, the United States can continue to reap benefits similar to those it has enjoyed over the past 75 to 100 years.

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