Economic Crises and U.S. Agricultural Exports

During the past few decades, economic crises have become commonplace, affecting both developing and developed countries and often hitting a number of countries simultaneously. These crises typically reduce the impacted countries’ imports, including agricultural products. Given that the United States is a major agricultural exporter, its farm sector is particularly vulnerable to such crises.

Examination of past crises and a simulation exercise of the effects of possible future crises show that such shocks can reduce U.S. agricultural exports considerably, especially if a crisis hits a number of countries simultaneously rather than a single country alone, as happened in the 1997-98 East Asian Crisis and 2008-09 world financial/economic crisis. In 1998 and 2009, agricultural imports from the United States by the major foreign markets struck by these crises fell collectively by 16 and 17 percent, respectively.