We talk a lot about agricultural exports here in Virginia. One reason is that we continue to break previous records for annual exports. I hope you all know that by now. I certainly mention it every chance I get.
It occurs to me, though, that there likely are many things you don’t know about Virginia exports. Let’s examine some of those surprising facts.
Virginia has been exporting agricultural products for 401 years now. Ag exports have been a significant part of the state’s economy since 1612 when John Rolfe exported his first crop of New World tobacco to England. You may have heard of Rolfe, the man who married Pocahontas.
With the advent of Nicotiana tabacum tobacco brought to Virginia by Rolfe in the form of seeds from Trinidad, a cash crop for export was off and running. These exports helped make the Virginia Colony profitable and they were the mainstay of the farming plantations for generations. Huge warehouses, such as those on Richmond's Tobacco Row, attest to its popularity. Even now, 400 years later, tobacco figures prominently in Virginia's economy and its exports.
Some of our top export markets may surprise you. Our top two markets, China and Canada, are not particularly surprising. Agricultural exports to China, largely driven by soybean and grain shipments, have increased by almost 230 percent since 2010 to more than $638 million in 2012. Approximately 15 percent of Virginia's agricultural export trade in 2012 was with China.
Canada holds the second spot with exports totaling more $205 million in 2012.
The third country on the list, Morocco, is a little less obvious, with approximately $139 million in goods purchased. Perhaps even more surprising is that in 2011, Morocco was Virginia’s top agricultural export destination.
Virginia's other top export markets include Switzerland, Turkey, Saudi Arabia, Indonesia, Vietnam, Venezuela, Cuba (Virginia is now the second largest U.S. agricultural exporter to Cuba), Mexico, Japan, Egypt, Ireland, Taiwan, Russia, Malaysia, Hong Kong, Chile, Poland, Italy, Tunisia, Jamaica, Georgia (the country, not the state), Germany and India.
Some of our export products may surprise you, too. Would you have guessed our greatest growth in 2012 was in wood pellets? Well, it was. Wood pellets saw a more than 800 percent increase from 2011 to 2012 with exports growing from almost $4 million to approximately $35 million, largely driven on new sales to the European Union.
Top export products in 2012 included soybeans and soybean meal; lumber, logs and wood products; unmanufactured leaf tobacco; soybean oil; wheat, corn, barley and other grains; pork; animal feed; processed foods and beverages, including wine; animal fats and oils; the aforementioned wood pellets; cotton; seafood and raw peanuts. Pork, peanuts, soybeans – no surprises there – but animal feed or animal fats and oils, who knew?
Agricultural exports generate approximately $1.40 in-state for every $1 shipped out. Ag exports not only produce revenue for our producers but for everyone along the business chain, from the farms and processors to our ports. They also create good jobs all across Virginia.
We set another record in 2012. Even in rough economic times, our exports have continued to grow. I don’t know of too many other economic sectors that can make that same claim. In 2012, agricultural exports from Virginia reached a new all-time high of $2.61 billion, shattering the previous record set the year before by almost 12 percent.
Our previous record level of agricultural exports was in 2011, when we shipped more than $2.35 billion in products into the global marketplace from Virginia ports. The 2011 figure was a six percent increase from 2010. Agricultural exports, which also include forestry products, have grown in value by approximately 17 percent since 2010. This growth comes despite a continued slow economic recovery worldwide.
Virginia’s success with ag exports is enhanced by a number of factors. These include quality producers, agribusinesses and exporters; an excellent sea, air and land port system; and a diversified portfolio of export markets and products.
The transportation system alone is one that few states can boast. At 50-feet, the Port of Norfolk offers the deepest shipping channels on the U.S. East Coast and is able to accommodate the 10,000+ container ships with more than twenty-foot equivalent units. More than 30 international steamship lines service the Port today, with Norfolk Southern and CSX railroads offering on-dock, double-stack intermodal service to key inland markets in the Midwest, Ohio Valley and the southeast. Virginia also boasts inland ports in Richmond and Front Royal.
The Virginia Department of Agriculture and Consumer Services has trade representatives stationed in key world markets. For more than 20 years, VDACS has maintained a marketing office in Hong Kong. Over the last three years, we have opened agricultural trade offices in India, China, Latin America and the European Union. These regions contain some of the world's largest and fastest growing economies. Later this year, Virginia will open an agricultural trade office in Canada.
In these areas served by our trade reps, exports have boomed. Our agricultural exports to China increased by more than 100 percent from 2011 to 2012. Exports to India grew from $5 million in 2011 to $28 million in 2012. Most of this growth was associated with new sales of soybean oil, lumber, logs and wood products. Exports to Mexico grew by more than $20 million, with new business in poultry and pork, and exports to Cuba reached an all-time high of $66 million.
With the trade offices Virginia has established in key global regions and new ones it will open this year, I expect that Virginia agricultural exports will continue to grow and to set new records. I truly believe that Virginia has never been better positioned than we are now to capture new export opportunities in the future as demand grows.
What began with a few tobacco seeds in John Rolfe’s pocket has grown into an export market that blankets the world. Would John Rolfe be surprised, or not? I don’t know, but I am absolutely certain that he would be pleased.
By Matthew J. Lohr, Commissioner, Virginia Department of Agriculture and Consumer Services