The U.S. Trade Surplus With China: Farm Products

From today's Financial Times (free subscription may be required):

"As U.S. politicians lose sleep over the trade deficit with China and the dollar-renminbi exchange rate, American farmers are eyeing a record $14 billion in exports there this year. The U.S. had a $4 billion trade surplus in agricultural products with China in the first four months of 2010, helping shave the total deficit to $71 billion in the period.

The U.S. is the world’s largest exporter of soybeans and cotton, commodities for which China is the world’s top importer. Exports “exploded” after China’s 2001 accession to the World Trade Organisation, says the US Department of Agriculture. Growing livestock and textile industries have stoked demand for animal feed and fibres.

“It’s huge,” says Randy Mann, who cultivates corn, soybeans and wheat on 2,500 acres (1,000 hectares) in Kentucky and chairs a trade and international affairs committee of the American Soybean Association. “Probably a third of the price on the Chicago Board of Trade is related to the soybean market in China. That’s the impact it can have.” Soybean prices have doubled in a decade to $10 a bushel."