Nearly two billion people in East Asia represent the fastest-growing region in the world for food supply and demand. Their nations’ economies will have a tremendous impact on the rest of the world. The U.S. Grains Council recently released a landmark research study—an extensive five-part project—to provide an in-depth look at the region’s agriculture, food and consumers and what impact they will have throughout the world.
I recently attended a Washington Ag Roundtable where U.S. Grains Council President and CEO Tom Dorr discussed the extensive report titled “Food 2040, Infinite Opportunities: Emerging Food Demand in Asia: Drivers, Features, Outcomes.” Dorr had just returned from a month-long tour of China, Japan and Taiwan.
Dorr made it very clear that Food 2040 is not a policy study. There is nothing in the study that is intended to represent an agriculture agenda or to result in an agriculture policy agenda. However, it contains a wealth of information for those interested in this region of the world.
According to Dorr, the speed of change is truly remarkable throughout southeast Asia, but particularly China. Asian countries realize that they must have stable economies, emerge from the “Dark Ages” and foster industrial trade policy.
The entire region is changing. The global middle class is growing rapidly. And the big question is how can we get ahead of the curve and take advantage of the emerging opportunities.
Realizing in 2010 that there wasn’t good data on food requirements in an aging demographic with an adequate amount of money to buy the food in a country like Japan, the Council engaged two research groups to focus on five research areas, including:
- Food technology/biotechnology
- Consumer trends: upper/middle class Asia
- Competition/policy/regulatory landscape
- Agriculture/food distribution and packaging
- Environment and resources
This resulted in the utilization of an adelphi study process (a structured interactive process based on a series of rounds of opinion gathering). It involved over 60 leading experts. Among them were 33 from Japan; three from Taiwan, two from the UK, one from Singapore, 17 from the U.S.; but, only one from the Peoples’ Republic of China. The group arrived at six key insights and, interestingly enough, those insights drove the entirety of the effort to China. The study illuminates a number of predictions of possibilities and outcomes:
- East Asia/China will become bioscience leaders
(They will make investments and become very impelling in this area.)
- Chinese consumers as the global driver
(In the next 30 years, whatever China wants, China gets. They will be the global driver of what goes on the food industry.)
- “Harvesting trust”: branding as a guarantee of quality
(There will be a new series of consumer labeling distribution branding and other food safety and security mechanisms developed to service these markets.)
- Asian diet: synthesis of tradition and science
(This is more focused on quality health standards. Selling them food products on a Western style diet, as opposed to what they expect, isn’t going to happen.)
- Food as a service: “Asia without kitchens.”
(70 percent of the middle class homes in Asia will not have a kitchen. They will eat food prepared outside the home.)
- Product differentiation; niche markets.
(These marketing initiatives will be even more important.)
The numbers in Food 2040 point to 1.5 trillion dollars in food exports. This takes in consideration the increased demand for meat, dairy products, vegetable oil and aquaculture. He believes that the real issue is: will the U.S. (not just from the farm but from the processing, shipping, fabricating industries) be positioned to capitalize on this incredible marketing opportunity?
That is the essence of Food 2040. It is intended to stimulate thought; to be extrapolated and utilized by other groups across agriculture. It provides a good look at the challenges and opportunities in this increasing important region of the world.