1985 Worst Foreign Trade Year for U.S. : Wheat Sales Plunge, Auto Imports Soar; Deficit $124.3 Billion

Led by a slump in demand for American farm products, the United States had its worst trading year ever in 1985, ringing up a $124.3-billion trade deficit, the Commerce Department said today.

The 1985 deficit was up 8.9% from the previous record of $114.1 billion set in 1984 and included a 24% drop in agricultural exports. U.S. farm exports of $29.2 billion last year were the lowest since $24.3 billion in 1977, and reflected a 40% drop in wheat sales.

The government said a 20% jump in auto imports also contributed to the trade imbalance.

For the year, imports rose 1% to $338.3 billion while exports fell by 3% to $214 billion.

Early Figures Confirmed

The new Commerce Department report confirmed parallel figures released two weeks ago which showed an even larger $148.5-billion deficit for 1985. The latest report on a balance-of-payments basis shows a smaller deficit because it omits such factors as military sales and the cost of shipping and insurance.

The deficit for all of 1985 included a record imbalance during the final three months of the year of $39.5 billion, contrasted with a deficit in the third quarter of $33 billion.

The big decline in exports was led by the 24% fall in agricultural exports. U.S. farm sales totaled $29.2 billion, the lowest level since $24.3 billion in sales in 1977.

Less Wheat Sent to Soviets

“Excess global production, the strong dollar, competition from other suppliers and increases in local production in traditional markets all combined to reduce agricultural exports,” the department said.

The government said the biggest decline occurred in wheat sales, which were down 40% from 1984, mainly because of reduced shipments to the Soviet Union.

The volume of corn exports dropped by 12% while soybean sales were down 10%.

The average price of soybeans was down 22% in 1985 contrasted with 1984 while corn prices dropped 17% and wheat prices were off 5%.

Japanese Cars Up 16%

The 1% rise in imports for the year was led by the 20% jump in car imports from countries other than Canada. Imports of Japanese cars were up by 16%.

Petroleum imports fell 12% last year to a total of $50.4 billion, the lowest level since 1978.

The average price per barrel decreased to $26.37, down from $27.95 in 1984. This price is expected to fall further this year, given the sharp declines in oil prices of recent weeks.

The average number of barrels imported daily dropped to 5.24 million in 1985 contrasted with 5.62 million barrels in 1984.