Competition For Ag Export Markets Is Aggressive
Serious cuts to funding place U.S. agriculture at a disadvantage.
The result is reduced spending power over time for market development programs, even while demand for the benefits these programs provide increases.
In fiscal year 2022, just $177.5 million of the $200 million MAP appropriation was allocated to the 67 organizations participating in the program.
Just $26.8 million of the fiscal year 2022 FMD appropriation was allocated to the 22 organizations participating in the program.
In fiscal year 2022, the buying power of MAP, allocated at $200 million per year, was only $125.2 million after sequestration, administrative costs and inflation.
The Need For MAP And FMD Is Greater Than Ever
Less Equipped to Reach a Growing Market
With growing global food demand, MAP and FMD participants could serve more customers who want to buy more U.S. agricultural products. In fact, a 2018 study showed, since the 2002 Farm Bill, overall agricultural imports had increased by more than 330 percent, from $247 billion in 2002 to $834 billion in 2018. This significant increase in market size, combined with the diminished purchasing power of MAP and FMD funding since 2002, means that U.S. producers are not well equipped to take on more aggressive foreign competition.
Increased Global Competition
The latest analysis of foreign export promotion activities found that several competing countries and the European Union spent close to $1 billion in public funds on agricultural export promotion in 2016. In real dollars, that was a 70% increase from 2011. Since that year, allocated U.S. public funding to help farmers, ranchers and small food businesses export their products stayed flat at $234.5 million. Adjusted for inflation, that was a 12% decline in public support for agricultural export promotion.
Increased Demand for Funding
The organizations using MAP and FMD are prepared to make effective use of considerable increases in program funding. Private funding from cooperating organizations exceeds 70% of the total annual investment in the MAP and FMD programs. Applications for cost share funding consistently exceed federal allocation amounts. Econometric studies consistently indicate the export market development programs are underfunded.
Regulatory Strains on Funding
New demands on MAP and FMD funding needed to fight increasingly challenging tariff and non-tariff trade barriers available funding for market development and promotion activities. While this market access work reflects cooperator support for supplement efforts of FAS and other regulatory agencies, it is often defensive, not offensive.