Asia’s Growing Consumerism Driving Demand for US Specialty Foods
Photo Credit: Dean & Deluca Japan
Could growing crops and producing food actually become cool again – not to mention lucrative?
Experts say the growing middle class populations in developing countries around the world are driving up demand for meat, vegetables and prepared food products from the United States. Rising demand and the resulting higher prices are drawing people back to the farm in record numbers. After decades of declining profits and fewer family farms, producing food is starting to become the “in” thing again.
With Georgia leading the nation in producing poultry and pecans, residents of the Peach State have a great opportunity to get in on the leading edge on an agricultural rebirth. And it’s not just farmers who stand to profit. Sophisticated consumers in countries like China and India have money to spend and a hunger for prepared foods and gourmet specialties. Even small mom-and-pop businesses in Georgia can succeed by exporting unique regional products like peach preserves, authentic Southern BBQ sauce and muscadine jelly.
According to the U.S. Department of Agriculture, the nation’s agricultural exports are forecast at a record $135.5 billion in fiscal 2011. That estimate represents a $26.8 billion increase over the prior year and $20.6 billion more than the previous record set in 2008. The USDA also anticipates a record $20 billion in exports to China, which will surpass Canada and Mexico to become the United States’ top market this year. U.S. agricultural exports to Asia are expected to hit a record $58.5 billion, with Japan, South Korea, Taiwan and Hong Kong rounding out the top five Asian markets in the forecast.
The USDA added the “world macroeconomic environment supports growing U.S. agricultural exports. Solid world growth and a weaker dollar support U.S. agricultural product export growth through increased demand for U.S. agricultural commodities.”
Agriculture is Georgia’s largest and oldest industry, contributing more than $65 billion to the state’s $786.5 billion economy in 2009, according to the Georgia Farm Bureau. The state Department of Economic Development noted that agriculture was a major factor in 2010’s record $28.7 billion in total exports.
Georgia ranked 17th among the 50 states in agricultural exports, contributing $1.78 billion of the fiscal 2010 total of $108.7 billion, according to the USDA’s Economic Research Service. Georgia led the nation in the exports of poultry and peanuts. The state’s top crop exports in 2010 include cotton ($572.5 million); poultry, eggs and related products ($468.7 million); peanuts and related products ($154.6 million); pecans and other tree nuts ($76.4 million); vegetables ($70.4 million); wheat ($55.9 million); tobacco ($47.2 million); peaches and other fruit ($46.7 million); soybeans ($44.8 million); coarse grain ($34.1 million); live animals and meat ($26.5 million); cottonseed ($14.1 million).
Miscellaneous food products accounted for $104.2 million of the Georgia total. Prepared foods and food ingredients fall into the “other” category, which includes wine, beverages, sugar, and “horticultural products such as starches, soy sauce, condiments, soups, gelatins, yeast, baking powder, vinegar and food preparations,” the USDA stated. Georgia’s exports in the “other” category have more than doubled over the past 10 years, and grew by almost $10 million from $95.2 million in fiscal 2009 to $104.2 million last year. Georgia also ranked ninth among the states in the “other” category of exports.
Georgia is known as the “Peach State,” but perhaps it should consider changing its nickname to the “Pecan State.” Georgia actually ranks third in U.S. peach production, but produces more pecans that any other state. (The other top pecan states are Texas, New Mexico, Arizona and Louisiana). With 80% of the world’s pecan crop grown in the United States, farmers through the Southeast and Southwest have been scrambling to put thousands of new trees into production. Rising prices, coupled with new demand from Asia, are making pecans and pecan-based products an attractive option for farmers and food producers.
The growing middle class in Asian countries has driven up demand for pecans, pushing prices up around the world, expects say. Pecans first became popular in China less than a decade ago, but consumption boomed in 2007 and has slowly doubled again since that time. Hilton Segler, executive director of the National Pecan Growers Council, said health-conscious Chinese are drawn to the high antioxidant levels in the nut. Pecans are also starting to take hold in India, where Segler predicts demand could catch up to China within three years.
Asia is also driving up demand for meats like chicken, pork and beef. According to published reports, the average U.S. citizen consumes 250 pounds of meat annually, while the average in China is 100 pounds and less than 10 pounds in India. Experts say those lower consumption totals indicate there is plenty of room to sell more meat products in Asia.
A lack of farmland, higher demand, increasingly sophisticated consumers and more disposable income are providing opportunities to expand U.S. exports of meats and other agricultural products. The time is ripe for Georgia farmers and specialty food producers to take advantage of favorable trends and move into the growing Asian export market.
Questions or comments? Please email Michael Fenton at email@example.com