International Trade, Output, Employment, Exports, International Relations/Trade, Q10, Q11, Q13, Q17,

Adcock, Flynn J.

Hanselka, Daniel D.

Paggi, Mechel S.

Rosson, C. Parr, III

English

Research Papers in Economics

  
 
 
1st  Quarter 2011 | 26(1)  
NATIONAL AND REGIONAL IMPACTS OF U.S. AGRICULTURAL EXPORTS 
Mechel S. Paggi, C. Parr Rosson, III, Flynn J. Adcock, and Daniel Hanselka 
JEL Classification: Q10, Q11, Q13, Q17 
Keywords: International Trade, Output, Employment, Exports 
Throughout the recent economic downturn, U.S. agricultural trade was one sector of the economy that 
remained relatively healthy. Agricultural trade provides a significant contribution to the U.S. agricultural 
economy and creates positive effects throughout the nonfarm sectors of economy as well. 
The United States is a net exporter of agricultural products and this trade surplus helps offset a portion of the 
U.S. nonfarm trade deficit. In 2010, U.S. agricultural exports reached $115.8 billion, setting a new record 
(Table 1). With imports valued at $81.9 billion in 2010, the agricultural trade sector recorded a trade surplus of 
around $33.9 billion; a sharp contrast to the over $668 billion deficit in nonagricultural trade. 
The purpose of this article is to provide background information on the important contribution agricultural 
exports make to the overall economy as a generator for output, employment and income. In addition we will 
provide an overview of how this contribution is distributed across the United States on a regional basis. 
The information provided in this article is based on an analysis using the Impact Analysis for Planning 
(IMPLAN). This economic input-output model was originally designed in the mid-1970s by the USDA Forest 
Service for community impact analysis (USDA, NRCS, Economics, updated 8/21/2009). The current version 
of the model is maintained and sold by the Minnesota IMPLAN Group, MIG, Inc. With over 1,500 clients 
currently reported to be using this modeling framework the results are accepted and widely used in inter-
agency analysis. The IMPLAN model shows the impact of how agricultural exports produce direct and indirect 
effects on the other industries and sectors that support the flow of U.S. agricultural commodities in 
international commerce. Accordingly, the output from the model reflects backward linkages in the economy 
and may actually understate the total overall contribution of the agricultural export sector to the U.S. economy. 
In this article we report the findings from our analysis of the contribution of U.S. agricultural exports to the U.S. 
economy. We provide results for the economy as a whole, along with results of the effects for four regional 
areas, the South, Midwest, Northeast and West. In addition we provide a comparison with earlier estimates 
from models that include both forward and backward linkages to provide a feel for the range of effects that 
agricultural exports may have on total output and employment.  
Effects on Economic Output and Employment 
In calendar year 2009, U.S. agricultural exports of $98.4 billion were supported by $280.5 billion in output in 
sectors throughout the economy (Table 2). Every $1 billion in U.S. agricultural exports generated 15,811 jobs. 
Employment resulting from agricultural exports included direct farm employment of 742,966 jobs and nonfarm 
related employment of 812,852 jobs for a total of 1.6 million jobs. The jobs resulting from agricultural exports 
reflect the output that is stimulated as farmers purchase inputs for production, and as commodities are 
harvested, transported and stored.  
Output and job creation related to agricultural exports is spread across supporting sectors of the economy. In 
2009, for example, the $280.5 billion in output created by agricultural exports was largely focused in the farm, 
services and food processing sectors but also made contributions in the manufacturing, trade and 
transportation sectors (Figure 1). In the same way employment associated with agricultural exports is also 
distributed across the various sectors (Figure 2). 
Regional Impacts 
All of U.S. agriculture is dependent to some extent on foreign demand, with some commodities being more 
dependent than others. The same is true for the areas where those products are grown. Accordingly, the 
economy in some areas of the country is more influenced by agricultural exports than in other areas. In 2009 
the Midwest region received the largest boost in output resulting from agricultural exports, while the Northeast 
area of the country received the least (Figure 3).  
 
 
  
The economic impact of agricultural exports on a regional basis reflects the relative importance of export 
markets for certain commodities and the geographical concentration of the production of those commodities. 
The dominant position of the Midwest in overall output generated and number of jobs related to exports 
reflects in large part the importance of feed grain and oilseed production in the region. In 2009, over 30% of 
the total value of all agricultural exports was accounted for by feed grain and oilseed products, in large part 
originating from the Midwestern region. Along with the host of other Midwestern products finding their way to 
international markets the economic stimulus from trade related activities is greatest for this region. Agricultural 
exports accounted for over $86 billion of output and around 410,000 jobs in the region in 2009 (Table 3). 
While the farm sector impacts were important, nonfarm sectors benefitted from Midwest agricultural exports. 
In fact, nearly 60% of the total output from exports can be attributed to non-farm sectors. Food processing 
was most important, with $16 billion in output, followed by services, manufacturing and trade and 
transportation. The nonfarm sectors accounted for 49% of employment, with trade and transportation being 
the most important. 
The next largest regional impact from agricultural exports is reported for the Southern region. Benefiting from 
the increasing prices of feed grain and oilseed exports as well as rice and cotton, states in the Southern 
region are well positioned to meet a sustained increase in international demand for U.S. agricultural products. 
In addition the numerous sea ports in the Southern region play a vital role in facilitating the movement of 
products from other regions of the United States to international destinations. In 2009 agricultural exports 
accounted for $43.8 billion and 336,385 jobs in throughout the region (Table 4). 
 
 
 
About 65% of the Southern region output can be attributed to nonfarm sectors. Food processing and services 
were dominant. Manufacturing and trade and transportation accounted for about 19% of output. Employment 
concentration was dominated by the farm with 63% of the total jobs. Services accounted for 19% of 
employment, while trade and transportation was nearly 8% and manufacturing only 2% of jobs attributed to 
exports. Employment concentration in the farm sector indicates the relative importance of labor intensive jobs 
associated with crop and livestock production in the region. 
The third largest area of impacts resulting from agricultural exports occurs in the Western region. Led by 
California with individual state agricultural exports valued at $34.8 billion in 2009, the Western region is the source of a wide variety of agricultural commodities including the majority of fruit, tree nuts and vegetables 
produced in the country, many with important export markets as well. From the total $98.4 billion in U.S. 
agricultural exports the Western region is assigned an additional $38.9 billion in output (Table 5). An 
additional 245,664 jobs are also estimated to result from the activities associated with agricultural exports for 
the western region. 
 
Economic output is concentrated in nonfarm sectors of the Western region economy. Food processing and 
services dominate, while manufacturing and trade and transportation are about evenly split. Employment from 
exports favors the farm sector, accounting for 56% of the jobs. Services, however, are also important and 
account for 24% of jobs, followed by trade and transportation, and then manufacturing. 
Characterized by smaller farm size, the Northeast region contributes the least output from U.S. agricultural 
exports. In 2009 U.S. agricultural exports accounted for a relatively small but important $7.6 billion in output 
and 53,333 civilian jobs in the region.  
Northeast region exports are supported by output attributed mostly to nonfarm sectors, as with the other 
regions. Food processing is dominant with 28% of output attributed to that activity. Employment is quite 
different, though, with two-thirds of all regional jobs concentrated on the farm. This high degree of farm jobs 
associated with exports likely reflects the more labor intensive production of tree fruits and other fresh 
commodities, along with dairy farming. 
Agricultural Imports 
While beyond the scope of this report, agricultural commodities imported into the United States also generate 
additional output. The transformation of imports to consumer goods involves the same type activities—
transportation, management, marketing—as do exports. As a result each dollar spent on imports has been 
estimated to result in additional output from support activities to produce a multiplier of 2.48 (USDA, ERS, 
FAU-124, April 2008). Using this measure the imports of $71.7 billion of agricultural commodities in 2009 
would have generated a domestic output of $177.8 billion. It is important to note that while imports of 
agricultural products can have a negative effect if they displace products that would otherwise be produced 
domestically, they do bring a benefit due to their linkage to supporting industry activity. 
Implications 
U.S. agricultural exports make a significant contribution to the overall U.S. economy, supporting $280.5 billion 
in economic output and 1.6 million jobs nationwide. This output is most heavily concentrated in the 
Midwestern United States, followed by the Southern region, the West, and then the Northeast. Employment attributed to exports is about evenly split between the Midwest and South, followed by the West and 
Northeast. Important too is that these economic gains associated with exports are not just accruing to the 
farm sector. In fact, in most regions of the country, the non-farm sectors of food processing, services, and 
trade and transportation receive an equal share of both output and employment. 
Also important to note is that as the U.S. Congress considers pending trade agreements with Korea, 
Colombia and Panama, there will be economic gains if these agreements are implemented. The Trans Pacific 
Partnership also holds promise as creating new markets for U.S. agricultural exports and the associated 
output they would create. Further, successful completion of the Doha Development Agenda is also important 
because of potential economic gains associated with exports to a wider array of countries than in the past. 
For More Information 
Edmondson, W. (2008). U.S. Agricultural Trade Boosts Overall Economy. U.S.D.A., Economic Research 
Service, FAU-124, pp. 11, April 2008. Available online: http://www.ers.usda.gov. 
Minnesota IMPLAN Group. (2008). IMPLAN Professional 2.0 and 2008 data. Input/Output Economic Impact 
Analysis Software. Stillwater, Minn. 
United States Census Bureau Foreign Trade Statistics. (2011). U.S. Trade in Goods (Imports, Exports and 
Balance) by Country. Available online: http://www.census.gov/foreign-trade/balance/index.html. 
United States Department of Agriculture Foreign Agricultural Service. (2011). U.S. Global Agricultural Trade 
System. Available online: http://www.fas.usda.gov/gats/default.aspx. 
United States Department of Agriculture Natural Resources Conservation Service. (2011). Economics, 
Technical Resources, IMPLAN Analysis Site. Available online: 
http://www.economics.nrcs.usda.gov/technical/implan/index.html. 
United States Department of Agriculture National Agricultural Statistics Service. (2010). Various production 
data resources. Available online: http://www.nass.usda.gov. 
Mechel S. Paggi (mpaggi@csufresno.edu), is Director, Center for Agricultural Business, Jordan College of 
Agricultural Science and Technology, California State University, Fresno. C. Parr Rosson, III 
(prosson@.tamu.edu), is Professor/Economist and Director, Center for North American Studies, Department 
of Agricultural Economics, Texas AgriLife Extension Service, Texas A&M University System, College Station, 
Texas. Flynn J. Adcock (fjadcock@tamu.edu), is International Program Coordinator and Assistant Director, 
Center for North American Studies, Department of Agricultural Economics, Texas AgriLife Research, Texas 
A&M University System, College Station, Texas. Daniel Hanselka, (dan@afpc.tamu.edu), is Extension 
Associate, Department of Agricultural Economics, Texas AgriLife Extension Service, Texas A&M University 
System, College Station, Texas. 
© 1999-2011 Choices. All rights reserved. Articles may be reproduced or electronically distributed as long as 
attribution to Choices and the Agricultural & Applied Economics Association is maintained. 
 
 
 

National and Regional Impacts of U.S. Agricultural Exports

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