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Growing Economies Provide Opportunities in SE Asia

by 5m Editor
4 February 2011, at 10:19am

SOUTHEAST ASIA - After studying market potential and other opportunities in India, the US Grains Council’s Officers Mission participants split up to cover more ground – with a portion of the group going to China and the others moving on to Viet Nam and Indonesia.

Viet Nam and Indonesia, both countries net importers of feed grains, are seeing economic growth and development, which is leading to increased income and buying power for citizens.

“Indonesia, for example, has made tremendous gains in per capita income,“ said Mike Callahan, USGC director for international operations in Asia. “In 2000, per capita income stood at $800 but by 2010, that had jumped to $3,000. Certainly things are moving in the right direction and the country is in a much better place than in the late 1990s when a financial crisis hit that region of the world.“

As economic buying power increases, dietary habits will continue to evolve and change, driving up the demand for meat and, therefore, feed grains.

Demand for pork and poultry will lead the way in Viet Nam, while poultry will be the focus in Indonesia. The aquaculture sector will play a key role, as well. For example, aquaculture production in Viet Nam grew from 2.4 million tons in 2008 to 2.6 million tons in 2010, and has the third largest demand for feed grains.

While in Viet Nam, the group met with representatives of Charoen Pokphand (CP), the largest feed miller in the world. While based in Thailand, the company has a growing presence in Viet Nam, including a new feed mill that has propelled it to the largest feed manufacturer in the country.

“CP’s investment in Viet Nam is testimony to the type of commitment they have made to the market and opportunities they view there,“ Mr Callahan said. “It was important for us to convey the message to them and others we visited in the region that the United States will continue to meet global demands for corn and other feed grains.“

Other meetings included information on the availability and opportunity that US distiller’s dried grains with solubles may provide importers in Southeast Asia.

“Our meetings in Viet Nam and Indonesia were very positive,“ Mr Callahan said. “We provided reassurance on feed grains supply and quality, and in return we better understand the needs of this growing market.“

Others on the Officers Mission who traveled to Southeast Asia were Don Fast, USGC treasurer; Julius Schaff, USGC secretary; past chairman Rick Fruth; Adel Yusupov, USGC regional director in Southeast Asia, and other Council staff and consultants from the region.