|ODA targets India and SE Asia as emerging markets
China stands tall as an international market for Oregon agriculture that has scarcely reached its full potential. Japan, despite the recent issues related to the March earthquake and tsunami, remains a long-standing and loyal customer. South Korea, with a possible free trade agreement with the US on the horizon, can solidify its high status as a trade partner. But the Oregon Department of Agriculture knows better than to rest on past laurels and stay satisfied with the current roster of export destinations. Newly emerging markets are gaining close attention from ODA as well as various Oregon companies and commodity groups, with India and Southeast Asia currently topping the list.
"We are a market watchdog for the industry," says Gary Roth, administrator of ODA's Agricultural Development and Marketing Division (ADMD). "We are always on the lookout for market opportunities for our farmers and food processors. Much of what we do is creating access and breaking down barriers in those traditional markets where most of our products are exported. But our portfolio includes being aware of new opportunities for Oregon agriculture in emerging markets."
More than 80 percent of Oregon agricultural products leave the state and about 40 percent go to international markets. As a result, assistance with exports is an important activity for ADMD and its 12-person staff based in Portland. ADMD conducts an internationally recognized market development program that includes participating in targeted trade missions and trade shows, conducting technical workshops to introduce Oregon products to buyers, and hosting inbound trade missions to Oregon.
In the past year, some initial and exploratory market development has taken place in the Middle East- specifically in Dubai in the United Arab Emirates, a major trade hub in that part of the world- and in India, the world's second largest nation in terms of population. There is also much interest in Southeast Asia and the countries of Singapore, Malaysia, Indonesia, and Vietnam.
"These are all places where we see growth potential for Oregon agricultural products," says ODA international trade manager Amanda Welker. "The recent global recession did not affect those areas so much. Their growth is still strong and these markets did not have to go through a big recovery like the rest of the developed world."
For the Middle East and Dubai, bulk commodities, such as grain, feed, and seed products, are now giving way to more high value products, including fruits and nuts, nursery products, and seafood. Twenty years ago, Dubai was just a spot in the desert. Now it could be the Hong Kong of the Middle East with great potential to reach a much larger audience.
But with a population approaching 1.2 billion people, India has nearly unthinkable potential. The expanding middle class of 300 million people shows no sign of slowing down. ODA has conducted two trade missions to India so far, taking along nine Oregon companies that represent a variety of fresh and processed food products. Early interest is focused on blueberries, cherries, pears, and dried and frozen fruits in general.
"The good thing about India is that there is no language barrier, everyone speaks English," says Welker. "Secondly, a high percentage of college students from India are going to school in the US. So they are coming here for college and when they return to India, they bring back those American tastes."
A simple thing like climate illustrates the need for consumer education. Oregon fruits, for example, are unlike anything found growing in India. To Indians, a blueberry is an exotic fruit.
"The biggest focus right now is probably on retail markets and on fresh products," says Welker. "They are looking at packaged products but still are attracted to the big brand names. They know Frito-Lay and Kraft, but we need to educate them on what else is out there."
Welker and ADMD trade managers have hosted inbound missions from India- giving the guests a first-hand look at Oregon products and how they are grown. They are very interested in learning more and will be visiting more often in the future. ODA also plans another outbound mission to India this year in what could become an annual affair.
"We need to expose our companies to the business climate over there," says Welker. "High tariffs and a weak transportation infrastructure that has problems keeping a temperature controlled supply chain are major barriers. But it's competitive, a lot of exporters see potential. That's why we are getting involved at this time."
With Singapore being the main port for agricultural goods in Southeast Asia, and with strong existing trade relations between Oregon and the Philippines, ODA has not paid a great deal of attention to such countries as Vietnam, Indonesia, and Malaysia. But that is starting to change.
"They are now on our radar," says Welker. "Strategically, we are in a good location for those markets as far as being on the Pacific Rim. That gives us an opportunity and we will be hosting a couple of inbound trade missions this year bringing buyers from Southeast Asia to Oregon. We also plan on an outbound trade mission to Vietnam, Singapore, and perhaps Indonesia."
Fresh fruits and hazelnuts are expected to be early entrees to these markets. Welker says there is also strong interest in dairy products, especially cheese.
Whether these early forays into India and Southeast Asia are successful remains to be seen. Establishing a beachhead in a market across the ocean doesn't happen overnight. But ODA will keep pursuing emerging opportunities. South America may warrant a closer look in the near future. For the ADMD trade managers, it's a matter of balance- maintaining and expanding the existing trade markets that already enjoy Oregon agriculture while looking for new partners.
For more information, contact Amanda Welker at (503) 872-6600.
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