For the first time ever, the world's superpowers of soybean production have joined hands to promote soybean consumption in India. Growers from Argentina, Brazil, Paraguay and the U.S. have begun working together to develop markets in India, all due to the efforts of the U.S. Soybean Export Council (USSEC).
Producer-leaders from the United Soybean Board (USB) and the American Soybean Association (ASA) hope to leverage producer checkoff dollars by building interest among South Americans to ultimately help increase India's demand for soybeans.
The role of the USSEC and ASA's International Marketing (ASA-IM) staff was to show the South Americans how they implement programs that have been approved and funded by U.S. soybean farmers through their national soybean checkoff. It would not be an overstatement to say that South American farmers almost envy U.S. soybean growers because of the power they get from their checkoff and USDA foreign market development programs.
This initial joint effort is directed solely at the Indian market, where the U.S. currently exports virtually no soy products today because of trade barriers and lack of full utilization of soy protein products. India does currently import substantial quantities of soybean oil from Argentina, and it does export some soybean meal to other Asian countries.
With more than 1 billion people and growing, this market represents an enormous future potential for all of the Americas, not just the U.S. Together, these four countries are responsible for 83% of the world's soybean production and 95% of world soybean exports.
“The objective of this first joint trade mission was to provide the South Americans with opportunities to see first-hand examples of how demand-building and promotional activities have been implemented in India for the past 10 years,” says USB Competitiveness Committee Chair Mark Pietz. “During this time, our reverse marketing efforts have reduced the amount of Indian soy meal that is competing with U.S. meal in Asian markets.”
The U.S. reverse marketing strategy is designed to get India to utilize the 6-7 million metric tons (220-257 million bushels) of soybeans it produces domestically. That is being accomplished by increasing demand for soy in India's poultry, dairy, aquaculture and human food sectors. At this point, soybean consumption in animal feeds has quintupled to more than 2.5 million metric tons per year.
“The time has come for South America to partner with the U.S. in these reverse marketing efforts by funding activities like feed technology workshops, marketing support and soyfoods training pro-grams in India,” Pietz says. “At one point, China was a net exporter of soybeans. But in the last eight years, due in part to 20 years of reverse marketing efforts by U.S. soybean farmers, it's become the largest export customer for U.S. soybeans.”
India has the second-largest population in the world and is expected to surpass China in numbers by 2040. Today, India's per-capita soybean meal consumption is less than one-tenth that of China.
ASA Chairman Bob Metz says, “Cooperation between U.S. and South American soybean farmers will also make it easier to deal with market access issues, including non-tariff barriers, phytosanitary issues, chemical residue limits, acceptance of biotechnology and excessive duties on soybean products. It's time for all soybean-exporting countries to work together in developing world demand for soybeans, and for defending our crop against competitive oilseed and protein products.”
During the week's activities, growers listened to briefings from ASA-IM India staff about the food and feed programs they are implementing to effectively consume all the soybeans produced in India, which will ultimately open the door for imports from the Americas. The growers also participated in news conferences with television and print media, which provided opportunities for grower-leaders from each country to answer questions about their intentions to work together to service the needs of India's large and growing population.
In addition, growers participated in two soyfood demonstrations, one designed for hotel food service staff and one designed for business entrepreneurs and non-governmental organizations.
The mission included visits to a poultry farm and a feed mill, where the South Americans learned how ASA-IM staff work with local customers to develop soy-based feeds. Meetings were also held with embassy officials and key food and feed industry representatives.
Each of these activities brought the South Americans closer to a full understanding of the challenges and opportunities available to them for conducting their own market development activities in India. They also showed them the depth and breadth of industry contacts in which the ASA-IM program is involved.
Pietz says, “I think the South Americans are amazed at the depth and the quality of the programs that we've run here for many years. They seemed very impressed with the personnel and the staff that we have here on the ground, and impressed with the market development and how it's moving.”
Associacao dos Produtores de Soja do Mato Grosso Vice Administrative Director Ricardo Arioli Silva says, “We Brazilian farmers see this as an opportunity. We hope that we can tell other farmers in Brazil how good it will be to work with our friends, the Americans, Argentines and Paraguayans.”
India for us is a very interesting market, says Sonia Tomassone, the foreign trade advisor for Paraguay's Export Association for Grains and Oilseeds (CAPECO). “Well, it's not so good that just the U.S. is making all the efforts. We want to contribute, as we can, of course. We have to stop thinking that we are competitors. The worldwide market is enough for everybody, and we have to work together,” she says.
When asked about opportunities for Argentina to work with U.S. farmers in India, Associacion de la Cadena de la Soja Argentina President Rodolpho Rossi says, “We will talk with everyone in the soybean industry chain and discuss what will be the next steps. But we will ensure that we'll join these efforts because we have a mission to provide soybean foods in the future.”
In today's global marketplace farmers have to look at new opportunities to stay on top and to succeed, Bob Metz says. “No differently than we work with our neighbors to promote our crop, we can work with our fellow farmers in South America to do the same thing.”
To learn more and view additional photographs of this trade mission, go to: www.soygrowers.com/library/india/ .
(Bob Callanan is ASA's communications director and recently traveled to India with the trade mission.)