(NAFB.com) – The USDA is forecasting that the agricultural trade deficit will shrink in 2026 more than previously anticipated. Agri-Pulse said USDA expects the trade deficit to drop from $43.7 billion in fiscal year 2025 to $37 billion in fiscal year 2026. That’s according to the Quarterly Trade Forecast published on Tuesday. During a previous report released in August, the USDA originally predicted a trade deficit of $41.5 billion in this fiscal year. Driving the adjusted outlook are factors like larger-than-expected exports. USDA’s export prediction during FY2026 is now $173 billion, up from the projected $169 billion in August. However, even with the revision, exports are still set to contract year-over-year after the U.S. recorded $175.6 billion in exports during fiscal year 2025. “A significant portion of the better outlook can be attributed to improvements in the Chinese market,” Agri-Pulse reported. “Exports are also projected to improve in South Korea, Japan, Mexico, and Southeast Asia.”
