Insight yields opportunity in emerging markets - The Packer

Insight yields opportunity in emerging markets

05/24/2013 10:41:00 AM
Richard Owen

Richard Owen, Produce Marketing AssociationRichard Owen, Produce Marketing AssociationIt didn’t matter whether they shopped in North America, Latin America, Europe, Africa, the Middle East or Asia-Pacific — consumers around the world taking part in Nielsen Fresh Food Insight’s third-quarter 2012 research repeatedly placed “fresh products” as a top driver for choosing food retailers.

More specifically, the quality of fruits and vegetables was found across the globe to be among the top 10 drivers for store selection.

No wonder fresh produce is increasingly realizing opportunities to grow business internationally.

If you’re wondering where in the world to start expanding business overseas, begin by educating yourself on emerging markets.

Euromonitor International reports developing markets are eyeing 10% to 48% growth in fresh foods by 2015, compared to the 3% to 7% growth in developed markets. China alone will represent 25% of total global consumption of fresh foods during this same time period.

In her recently released market research report, Produce Marketing Association China consultant Mabel Zhuang indicates China is the third-largest agricultural importer and quickly rising in rank, for good reason.

China represents 22% of the world’s population relying on 7% of the world’s arable land.

More than 200 cities in China have populations over 1 million, whereas only 35 cities in all of Europe can make this claim. The country needs the world’s help to feed its people.

Food safety scandals have also led to increased demand for imported foods in China and in other emerging markets.

Helping make India an attractive market for fresh fruits and vegetables are sophisticated, organized retailers and hotel and foodservice operators in urban areas who are under pressure to improve safety standards.

India also has a large and growing middle class with rising disposable income.

In 2011, Sumit Saran from the SCS Group in India explained to PMA Fresh Connections: Southern Africa attendees that India is one-third the size of the U.S. with three times the U.S. population — 1.16 billion people with 300 million representing the middle class.

In short, India’s middle class population is equal to the entire U.S. population.

A rising middle class is common among emerging markets. Such is also the case in Brazil, where economic growth has created a growing middle class willing to spend their disposable income on higher-quality products.

According to a market analysis report on Brazil published by Agriculture and Agri-Food Canada, “as incomes have increased, the consumption of food has risen among all income groups.”

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