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Ag economist: Strong global opportunities exist
Local walnuts are making an appearance on what amounts to a South Korean Home Shopping Network.
"A group in South Korea sells our products on the show. They show video footage of our processing plant," said Mike Powell, a walnut buyer for Atlas World Food & Agriculture, which opened a new processing plant in Colusa in 2012.
Atlas works with about 50 walnut and pecan producers in the area, including Colusa, Tehama, Sutter and Yuba counties. Their marketing team spends months in Hong Kong, China and South Korea.
Powell, who usually splits his time between Visalia and Colusa, will be traveling to China and Istanbul this summer to promote California walnuts.
"We're going to start new relationships and build on current relationships," Powell said during the 48th annual Colusa Farm Show on Wednesday.
International marketing of California agricultural products to emerging middle class markets in China, South Korea, and other developing counties was a common theme throughout the Farm Show and at the Ag Leadership Breakfast.
Keynote speaker Vernon Crowder, the senior vice president and agricultural economist at Rabobank's Food and Agribusiness Research and Advisory Group, said with the global population projected to be 9 billion by 2050, and a mass movement from rural to urban areas across the globe, food producers in California can expect a growing demand for their products.
Crowder broke the concept down into a very simple everyday snapshot.
As the global population becomes more urban, income is expected to rise, and with that comes the ability to purchase what Americans view as basic essentials.
"More money means more refrigerators," said Crowder, explaining how refrigeration allows people to store more goods, which will increase the demand for those goods.
One example of that, he said, is meat.
"California quality meat can expect a demand increase by 70 percent," Crowder said.
Focusing on each of the prominent local crops — almonds, walnuts and rice — Crowder explained that the region's agricultural products have growing opportunities in developing countries.
"Almonds ship well and we have a great marketing organization. Demand for almonds will remain strong," Crowder affirmed.
He said the same is true for walnuts, and emphasize that California rice producers already have a foothold in the best global markets, the same markets that are expected to grow as their populations do.
"There has never been this kind of emerging economic growth in the history of the world," said Greg Thompson, general manager of the Prune Bargaining Association who gave a seminar at the Farm Show on Wednesday about how California producers can tap into those markets.
"The first thing people want to do when they have extra money, is they want to improve their diet," he said.
"They are looking for food safety, which they don't have in China," said Thompson.
He said the lack of faith in the food system is due to the use of illegal pesticides and other standards and enforcement.
Powell's company has seen similar values in South Korea.
Powell said the USDA and other agencies are tracking nut production all the way from the field.
"They're starting to regulate hullers and dryers. The impetus has been recalls of peanut butter over the last four years," said Powell. The additional documentation of standards aids in global marketing.
In addition to China and South Korea, Turkey is a big market for California producers, particularly nuts.
"Turkey grows a lot of nuts, but not a lot to our standards and they are huge traders," said Powell. "They can work with countries we don't, like Iraq and Iran. Walnuts are a staple of their culture. Its considered a sharing or friendship food."
Because tapping into these opportunities is all about marketing, where the product ends up has little impact on food producers.
"It doesn't matter where it goes. It's just where the money and the market is," Jim McCartin said about the rice he grows at Starkey Farms outside of Oroville.
Starkey Farms rice was sold to China last year.
"We don't have to change a thing. They like medium grain rice. China is a big fan," said McCartin.