Food Exports ($13b), Food Trade Surplus ($10b) w/China Set Record Highs in 2009; Is It Beholden?
There are a lot of articles like this one that say things like:
NEW YORK (CNNMoney.com) -- "It looks as if China still can't get enough of one of America's finest exports: our debt. Some worry that the U.S. is becoming too beholden to China. Some have speculated that a trade war with China could result in China selling some of its U.S. Treasury stake as retaliation for any further tariffs on goods imported from China."
But there's another one of America's finest exports that China can't get enough of: U.S. food.
According to USDA data, the Chinese purchased more than $13 billion worth of U.S. food in 2009, and surpassed Mexico and Japan to become the second-largest destination for American food exports behind Canada. In 2008, China surpassed the European Union in U.S. food exports for the first time ever, and took over the fourth place ranking for U.S. food exports. In just the last three years, U.S. food exports to China have doubled from $6.7 billion in 2006 to more than $13 billion last year, and there is no other country whose appetite for U.S. food exports is growing faster than China's.
Our food trade surplus with China topped $10 billion last year for the first time, and has almost doubled in the two years since 2007, when the food trade surplus was $5.4 billion (see chart above). We hear a lot about our overall trade deficit with China, especially for manufactured goods, but there's been almost no attention paid to our large and growing trade surplus with China for agricultural products.
Q: As China increases its reliance on U.S. farms to feed its growing population of 1.3 billion, will it worry that it is becoming "beholden to the U.S." as a food source?
Actually, a better way to look at international trade is that is generates interdependence, cooperation, peace and goodwill among trading partners, and not the "dependence" that "beholden" implies.