Asia’s opportunity as global produce player - The Packer

Asia’s opportunity as global produce player

09/20/2013 09:44:00 AM
John Giles

John Giles, Promar InternationalJohn Giles, Promar InternationalFruit growers are fruit growers all around the world — so goes the saying.

The sheer scale of production and increasing exports from Asia, however, is starting to dominate the global fruit trade.

Its influence will only continue to grow in the forthcoming years, and, while the role of the U.S. to date has been rapidly increasing in the development of these markets, the likes of Chile, New Zealand and Australia have all also been active in them for more than 10 years.

The U.S. does import from some of these countries — notably Thailand and India — and U.S. exports (especially apples, grapes, pears, cherries and citrus) have been growing impressively.

In the future, we are likely to see more fruit imported into the U.S. from a diverse range of Asian markets.

It might well be, though, that the relationship with the U.S. is not just a supplier/buyer of physical product, but also as a source of expertise and technology to Asia. Even here, the U.S. will find it a demanding and highly competitive market.

The development of the fruit sector in Asia has traditionally revolved around what happens in the likes of India and China, which totally dominate at the big-picture level.

What is starting to happen in the rest of the region is also highly impressive.

Production in a whole range of countries such as Indonesia, Malaysia, the Philippines, Vietnam and Thailand is beginning to show dynamic growth.

Even countries such as Myanmar, previously an essentially closed market after years of military dictatorship, has started to open up.

Exports across the region are also starting to develop.

While these have traditionally been focused on neighboring local markets, a wider range of export markets will be supplied in the future. These will take into account long distance markets such as the European Union and the U.S.

One of the key features of the development of the supply chain in Asia is the rise of modern forms of retailing.

In India, this accounts for only 5% of the market at the moment, but in China it is already around 25% and growing fast. The Pacific Rim markets such as South Korea and Taiwan are also seeing the rapid growth of more modern forms of retailing.

There will be niche opportunities for the U.S. in higher added-value food products in markets such as Hong Kong and Singapore.

That is not to say there are no other opportunities for the U.S. supply chain to profit from the huge macroeconomic growth being seen in Asia. Far from it, in fact.

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