Seasonally adjusted, US real GDP rose a strong 3.5% in the third quarter of 2016, but then slowed to a lousy 1.9% in the fourth quarter. (All growth rates are at an annual rate). Are these figures representative of an underlying economic trend? Believe it or not, soybeans were actually an important factor in the swings in growth.
The US had a bumper crop of soybeans last year and exported a huge amount to China, recorded in third quarter exports. Seasonally adjusted, total real exports of food surged 216% in that period, the largest quarterly gain since 1969. The rise in good exports accounted for most of the rise in merchandise exports that quarter and the surge boosted third quarter real GDP.Read More