How the US is Recalibrating Agricultural Exports Amid Global Trade Shifts

As trade talks with India advance and tensions with China linger, the U.S. is strategically realigning its agricultural export strategy to focus less on bulk commodities and more on high-value, consumer-ready products.

The U.S. agricultural export landscape is undergoing a pivotal transformation. Once dominated by bulk commodities like soybeans, corn, wheat, and cotton, American farm exports are now increasingly shaped by processed foods, fruits, vegetables, meat, and dairy products. This shift comes at a time of critical geopolitical and trade realignments - particularly as the U.S. pushes to expand agricultural exports to India and adjusts to the continuing fallout from the tariff war with China.

The Rise and Retreat of Bulk Commodities
A recent report by the U.S. Department of Agriculture’s Foreign Agricultural Service (FAS), “The Rise and Fall of Bulk Commodities as a Share of Total U.S. Agricultural Exports,” captures this shift with striking data. Between 2014 and 2020, bulk commodities made up about 31% of total agricultural exports. This share briefly rose to 38% in 2022, only to fall again to a projected 28.5% in the latest reporting period.

This volatility reflects both structural and external pressures. While volumes remain high, the value of bulk exports is declining relative to consumer-oriented and higher-margin products - an important consideration as the U.S. seeks new trade partnerships, including with India.

Trade Tensions and Strategic Diversification
The background to these shifts is complex. The U.S.–China tariff war severely disrupted trade flows. Retaliatory tariffs from China led to a sharp fall in U.S. exports: soybean sales to China, for instance, plunged from $25 billion in 2015 to under $10 billion in 2018. While some of this ground has been recovered, current export levels to China remain below pre-tariff levels.

India, on the other hand, is emerging as a potential growth market. As trade negotiations progress, the U.S. is lobbying for greater access for its farm products - including dairy, poultry, fruits, nuts, and processed foods - into India’s vast consumer base. This dovetails with Washington’s strategic pivot toward high-value exports, which are better suited to India’s growing middle class and rapidly modernizing food retail sector.

High-Value Products: The New Frontier
Consumer-oriented goods now account for 42% of U.S. agricultural export value, compared to bulk commodities’ 32%. These include tree nuts, processed foods, and fresh produce - products that offer higher margins, steadier demand, and branding potential. Importantly, they also align with India’s import trends, where demand for high-quality, value-added products is rising.

Advances in processing, refrigeration, logistics, and marketing have allowed U.S. agribusinesses to compete in this space globally. In 2024 alone, such products generated $37 billion, or 19% of total agricultural export value.

Diversifying Trade Routes
Amid shifting trade winds, the U.S. has diversified beyond China. In 2024, bulk export volumes hit record highs in Mexico (+29%), Colombia (+20%), Japan (+43%), and South Korea (+107%). While China still accounts for 24% of U.S. bulk export volume, falling prices have diminished its value share.

Policy Implications and Future Strategy
The FAS report underscores the need for a new approach. For decades, U.S. agricultural policy and infrastructure were geared toward bulk commodities. But now, success hinges on investing in value chains - processing units, cold storage, port logistics, and branding - to support consumer-ready goods.

At the same time, U.S. farmers face a volume-versus-price dilemma. While 2024 saw a 22% jump in bulk commodity export volumes due to strong harvests, overall export value stagnated at $191 billion - well below the 2022 peak of $213 billion - due to soft prices. The FAS analysis paints a clear picture: bulk commodities are no longer the defining face of American agricultural exports. They remain essential in volume, but the future lies in higher-margin, consumer-oriented products. 

As the Trump administration is in talks with India, these insights carry policy relevance. U.S. negotiators are likely to push for easing market access for value-added farm goods, while India will seek safeguards for its vast farm-dependent population. A balanced, reciprocal trade agreement could unlock substantial benefits for both sides.