U.S. agricultural exports this year are expected to reach $104.5 billion, the second-highest level ever, with stronger than expected demand from Canada and China lifting fruit, vegetable and nut shipments to a record level.

Horticultural exports, including fresh and processed fruits and vegetables as well as tree nuts, will total $22.5 billion in 2010, according to a U.S. Department of Agriculture trade update released in late May.

The USDA’s horticultural exports estimate is up $1 billion, or 4.7%, from a February projection and up 9.2% from $20.6 billion in 2009.

Higher fresh fruit and vegetable exports are primarily due to increasing sales volume to Canada, the USDA said.

Additionally, the USDA cited “surging volumes” of almonds, pecans and walnuts to China and Hong Kong.

“U.S. exporters have significant market share in this region and have benefited from skyrocketing demand,” the USDA said.

The USDA raised projected fresh fruit and vegetable exports in the 2010 marketing year, which ends Sept. 30, to $5.9 billion, up $200 million from a February estimate.

Expected 2010 fresh fruit and vegetable exports would be up 9.1% from $5.41 billion in 2009. For the first six months of the 2010 marketing year, exports were up 7.3%, to $2.79 billion.

Overall, U.S. agricultural exports were up 14% during the first six months of fiscal 2010, illustrating the expanding role of China, and the rest of Asia, as a major customer for U.S. agricultural products.

This year, Asia is expected to surpass the Western Hemisphere as the largest region market for U.S. exports, the USDA said.

Higher exports also reflect the USDA’s stepped-up efforts to sell farm products overseas, the agency said.

“The USDA has been working aggressively to improve opportunities for U.S. agricultural exports,” Agriculture Secretary Tom Vilsack said in a separate statement today.

“Efforts to increase trade are an important part of the administration’s effort to strengthen our economy here at home,” Vilsack said.

Those efforts include opening new offices overseas and “more constructive, effective dialogue on trade issues with growing market economies,” Vilsack said.

This year’s projected U.S. ag exports of $104.5 billion, revised higher by 4.5% from a previous estimate in February, are second only to the $115.3 billion exported in 2008, the USDA said. Exports for fiscal 2010 would be up 8.2% from $96.6 billion in 2009.

While U.S. and Europe struggle to recover from recession, China went largely unscathed from economic turmoil of recent years. China’s economy is expected to grow 9% to 10% this year, compared with 1% growth for Eurozone countries, the USDA said.

“Emerging Asia will lead the world economic turnaround,” the USDA said in the report.

U.S. ag exports to China are expected to total $14 billion in 2010, up from $11.7 billion projected in February and up from $11.2 billion in 2009, USDA said. China would be the third-biggest single-country market for U.S. farm exports behind Canada and Mexico. Last year, China ranked fourth.