Government funding of Ag export promotion groups like USDEC has contributed billions to the national economy while creating hundreds of thousands of jobs.

An important source of funding for the U.S. Dairy Export Council, as well as numerous other agricultural commodity groups, has been shown to have a huge multiplier effect when it comes to helping farmers and the nation as a whole. 

A new study shows that two export development programs from the U.S. Department of Agriculture -- the Market Access Program (MAP) and Foreign Market Development (FMD) -- working in tandem with ag industry groups, contributed $45 billion annually to the national economy from 2002 to 2019. 

Graphic: Ag Exports Count

This additional export revenue “bolsters the entire U.S. agricultural sector and creates a multiplier effect throughout the U.S. economy,” says Gary Williams, an agricultural economist at Texas A&M University, who helped conduct the study.

Export promotion pays off for farmers

The study, conducted by IHS Markit in cooperation with ag economists at Texas A&M University, showed that MAP and FMD increased cash receipts for farmers, livestock producers and dairy operators by $12.2 billion per year. 

USDEC is a beneficiary of these USDA programs, designed to build commercial export markets for U.S. agricultural products and commodities.

A majority of USDEC’s funding comes from another source –- the national dairy checkoff provided by farmers themselves -- but MAP and FMD funds provide a vital complement to those farmer investments. A third source of USDEC revenue is membership dues.

Combined, these funding sources have enabled USDEC to be a catalyst for U.S. dairy exports, helping U.S. dairy suppliers achieve record sales of $7.75 billion in 2021.

"MAP and FMD play a critical role in USDEC cheese and ingredient programming,” said USDEC President and CEO Krysta Harden. “Without such public-private partnerships supporting our market development efforts, U.S. dairy exports would not be where they are today. These programs are highly effective in helping us raise the profile of, and building demand for, U.S. dairy around the world.” 

The MAP and FMD programs are authorized by the Farm Bill and administered by the USDA’s Foreign Agricultural Service.

The study also analyzed the potential impact of the Agricultural Trade Promotion (ATP) program that USDA established in 2019.

The ATP program provided $300 million to cooperating organizations, to which they contributed $90 million in cash, goods and services. The study’s analysis of future expected returns from those investments between 2019 and 2026 predicts that incremental funding for agricultural export market development will provide an excellent return. 

The study projected ATP funding should generate:

• $11.1 billion in additional agricultural export revenue, about $1.4 billion annually.
• $6.44 billion in farm cash receipts, about $810 million annually.
• $22.6 billion in sales, about $2.8 billion annually.
• $11.2 billion added to the U.S. GDP, about $1.4 billion annually.
• 14,780 jobs in related fields.

MAP and FMD boost Ag exports, economy

The study also found that over a longer period -- from 1977 to 2019 -- MAP and FMD accounted for 13.7%, or almost $648 billion, of all the revenue generated by U.S. agricultural exports. 

“Not only do we bring the quality, reliability and sustainability of U.S. food and ag exports to the world marketplace, but we are also supporting our hardworking farmers and so many other industries at home with these increased jobs and income,” said Jim Sutter, board chair of the U.S. Agricultural Export Development Council. “It is rewarding to see the returns of these programs outlined in a way that shows their impact on the U.S. economy as a whole.”

Study just the latest to show benefits

The study was hailed in a news release by the Coalition to Promote U.S. Agricultural Exports, a group of 150 organizations, including USDEC, focused on protecting and enhancing U.S. agricultural export promotion programs. 

“Four studies of export promotion programs since 2007, using various econometric models, have all shown the same, bottom-line result – MAP and FMD work for American agricultural producers,” said Robbie Minnich, senior government relations representative with the National Cotton Council, and chair of the Coalition to Promote U.S. Agricultural Exports.

“Without question, the economic benefits they return far exceed the investment made.”

To download the 73-page study, click here. To learn more about the impact of MAP and FMD, visit www.AgExportsCount.org.  

Learn more:

• FAQ 4: How is the U.S. Dairy Export Council funded?

• U.S. dairy exports set multiple records in 2021

   

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The U.S. Dairy Export Council fosters collaborative industry partnerships with processors, trading companies and others to enhance global demand for U.S. dairy products and ingredients. USDEC is primarily supported by Dairy Management Inc. through the dairy farmer checkoff. How to republish this post.