USDA trade outlook lifts ethanol and sorghum export forecasts

USDA on May 28 raised its fiscal 2026 ethanol export value forecast to $5.1 billion, up from $4.6 billion in fiscal 2025 and above the $4.7 billion it had projected in February. The agency also pushed sorghum export volume to about 213 million bushels, more than double last year’s roughly 89 million bushels, giving two smaller farm-sector categories an outsized role in the spring trade update.

The May outlook from USDA’s Economic Research Service and Foreign Agricultural Service covers fiscal year 2026, which runs from Oct. 1, 2025, through Sept. 30, 2026. USDA put total U.S. agricultural exports at $176.5 billion and imports at $205.5 billion, leaving a $29 billion deficit. The next quarterly update is scheduled for Aug. 27.

For ethanol producers, the higher export forecast matters because it points to stronger foreign demand for a value-added outlet tied to corn processing capacity. The Renewable Fuels Association said U.S. ethanol exports hit a record 1.91 billion gallons in 2024, with shipments going to 80 countries and equal to 12% of U.S. ethanol production. The U.S. Energy Information Administration said fuel ethanol exports averaged 138,000 barrels per day in the first seven months of 2025, the highest January-through-July average in its data back to 2010.

Sorghum’s jump is even starker. USDA’s forecast implies a much larger pull from overseas buyers in the Plains and Southwest at a time when the agency’s Feed Outlook says the 2026/27 U.S. sorghum crop is projected at 367 million bushels, down 70 million from 2025/26. That tighter supply outlook makes exports more important as a clearing mechanism for the crop.

Dairy and cotton also added support to the trade picture, with dairy exports seen rising from $9.2 billion to $9.9 billion and cotton export volume forecast near 12.4 million bales. Cotton’s export value was still pegged slightly lower at $4.8 billion. Even with those gains, the broad farm trade balance remained negative, but ethanol and sorghum showed where marginal export growth is coming from: durable biofuels demand in one case, and a sharper-than-expected market outlet in the other.