The global coronavirus negatively impacted Wisconsin’s agricultural exports last year, but the industry is showing signs of recovery from the preceding years’ trade wars.
Wisconsin agricultural exports totaled $3.32 billion in 2020, up from the previous year, but down compared to the five-year average, according to Mark Rhoda-Reis, director of DATCP’s International Agribusiness Center.
“A number of things have affected the export volumes and how they’ve been down year on year for food and agricultural products,” Rhoda-Reis said in an export update from end-of-year 2020 March 4 at the Wisconsin Board of Agriculture, Trade and Consumer Protection meeting.
Wisconsin Department of Agriculture, Trade and Consumer Protection Secretary-designee Randy Romanski said the numbers were promising and the state will benefit from continued recovery from the coronavirus pandemic.
“We are optimistic that we’ll continue to see that upward trend,” Romanski said. “It’s important to continue to build relationships. I think our team has done great using virtual platforms to stay connected. But as we see things open up, it’ll be really helpful to get back out.”
Rhoda-Reis’ International Agribusiness Center identifies export opportunities around the world and provides export assistance to Wisconsin’s food and agricultural industries. The Center’s economic development consultants provide technical expertise and market development initiatives to aid the growth of Wisconsin agriculture through increased exports and the development of trade enhancing partnerships, and they offer export education, market access support, market development and promotion.
IAC just wrapped up a virtual trade mission to Japan, making efforts at connecting seven Wisconsin processors with partners and consumers there. They made several similar missions throughout the year in 2020, including e-commerce efforts directed at China and virtual trade show appearances in areas of Latin America, Asia and the Middle East.
“It’s not ideal but we’re able to still help folks to gain new customers, new areas in the market,” Rhoda-Reis said. “Although we’re not able to get out of the country to see our customers directly, we are able to do that at work.”
Rhoda-Reis said the Center officials are hoping that by September they are again able to make in-person appearances at shows in the U.S. or overseas.
“We know that although virtual is working and it’s easier to travel that way, it is not ideal, especially if you’re looking to open a new market or meet a new customer, establishing the relationship,” he said. “You really need to be present in person with them to do that.
“So we’re holding our own. If you sold in a place before with similar products, you’re able to move that forward. But to really grow the business, we need to be there.”
Overall, agricultural exports were up about 1.4% in Wisconsin and about 4% for the U.S., up from 2019 but down from previous years.
China was the only market that went up out of our the state’s top five trading partners, which make up about 60% of the total export market, Rhoda-Reis said. China was up about 30%, driven by recovery their swine herd and early recovery from the pandemic for their economy and the resulting increase in demand, as well as the initial commitments in the Phase One U.S.-China trade deal.
“They’ve lived up to some, not all of those of those (Phase One commitments),” he said. “Those have helped, at least in the areas a lot of our companies are working.”
Mexico had been the state’s No. 2 market, but now they’ve dropped to No. 5, which is troubling, Rhoda-Reis said. Mexico imports are currently below the five-year average of $282 million and well below the 10-year high of $412 million.
“It’s a precipitous drop,” he said. “We really need that market to help pull the rest of the international sales up.”
While Canada is the state’s largest market, without the demand and volume going to Mexico, it would require big increases from the state’s other markets to return overall state exports to closer to average, Rhoda-Reis said.
“We need to work in a number of different areas, both the traditional markets that we know and also reach out to those new and growing markets and to really redouble our efforts,” he said. “Certainly when we’re able to travel, we need to help folks get out there to meet new buyers.”
Romanski said he’s optimistic that efforts put forth by Gov. Tony Evers in his 2021-23 budget proposal will help Wisconsin officials advance the state’s efforts when it comes to international trade.
“International trade is a critical piece of Wisconsin’s economic success,” Romanski said. “When it comes to international trade Wisconsin punches above its weight. It takes a lot of work to build our state’s intercultural markets at all levels from local to international.”