Ms Mordaunt told MPs that she has just returned from a trip to Texas which expects to sign a trade deal with the UK in October. But she said that the first of 20 such deals with US states are about to be signed representing 20 percent of US GDP. She pointed out that while many EU states have very small economies, Texas alone would be the seventh largest in the world if it was an independent country.
It came as Labour and SNP MPs again complained about Britain leaving the EU in a Parliamentary session.
The issue came up with veteran Tory backbencher Damian Collins raising it in International Trade questions in the Commons.
He said: "States in the USA like Texas and California have larger GDP than many European nations.
"Aside from the UK/ US negotiations, could the minister say what progress is being made in doing trade deals between the UK and individual states in the USA?"
Ms Mordaunt said: "We are making considerable progress on this and we are in discussions with around 20 US states.
"I have just returned from Texas which, if it was a country in its own right, would be the seventh largest economy in the world.
"We are going to do a state level agreement with Texas we hope by October of this year and we will start signing these agreements with US states next month.
"The first eight we have in the pipeline will be the equivalent to 20 percent of the US economy."
The good news comes despite US President Joe Biden being reportedly not prioritising a US trade deal with the UK because he disagreed with Brexit.