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Emerging markets focus of U.S. Grains Council meeting

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Combination of outdated agricultural policy and regulation creates roadblock for U.S. products in India.

The name of the game in today’s challenging agricultural trade environment is emerging markets, and the U.S. Grains Council (USGC) set its sights on India, Africa and new opportunities for ethanol sales on during its 59th annual Board of Delegates Meeting.

According to USGC, India has shown solid economic growth and is one of the world’s fastest-growing economies. The population is very young – 45% under age 25 – but a combination of outdated agricultural policy and regulation creates a roadblock for U.S. products in India, said Scott Sindelar, chief executive officer of Edgewise Trade Advisers and a former official with the U.S. Department of Agriculture's Foreign Agricultural Service (FAS), who spoke to the council’s delegate body.

“There is significant potential for U.S. agricultural and food products in India, but expectations must be balanced by the reality of India,” Sindelar said. “There is a substantive role the USGC can play in India. India’s leaders are intent to have the country be a leader on the global stage, and changes within the Indian government could help USGC programs build demand and enable change from within.”

Kurt Shultz, USGC senior director of global strategies, spoke on how the organization’s work is expanding into East and West Africa, building on longtime programs in North Africa using resources from new funding sources like the Agricultural Trade Promotion (ATP) program, administered by FAS. He told delegates that more than half of global population growth by 2050 will occur in Africa, which will drive feed demand that can be captured with additional focus on capacity building and marketing.

“The council works where the market does not,” Shultz said. “Africa and the Middle East show an opportunity for expansion of commercial feed production. We’ve worked in Morocco, Tunisia and East Africa, but with the availability of ATP funding, we’re planning on new programs in both East and West Africa.”

Shultz said the system needs to be challenged to bring in updated equipment, leverage past investments and train a new generation in sub-Saharan Africa. “We want to reinforce our programming in Tanzania while we expand programming in Kenya and Ethiopia to identify key market players and engage them in marketing programs. We can’t solve every problem, but we can plant the seeds,” he said.

The attendees also heard an ATP update from chief economist Mike Dwyer and USGC manager of ethanol export market development Brian Healy specifically on ethanol programs, which received the largest single portion of the council’s total ATP award of more than $20 million. The funding has allowed USGC to dramatically expand the scope and depth of its ethanol programs, including technical assistance, policy development and in-country engagement.

“Growth in the middle class is driving changes in markets around the world,” Healy said. “ATP funding will allow us to scale up global engagement in emerging markets while continuing our engagement with mature markets that show near-term demand.”

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