Industry leaders look at new ag market potential moving into the future
Arlington, Va. – With the landscape of agriculture continually changing, four agriculture industry leaders gathered at USDA’s Agriculture Outlook Forum on Feb. 20-21 to discuss building markets, both domestically and abroad, to improve agriculture’s ability to thrive.
Panelists included Produce Marketing Association President Cathy Burns, Mercaris Founder and CEO Kellee James, DuPont Pioneer President Paul Schickler and U.S. Agency for International Development Administrator Rajiv Shah.
Future of the industry
Panel moderator U.S. Secretary of Agriculture Tom Vilsack asked panelists to address the outlook of market creation over the next five, 10 and 20 years.
“Demand creation will continue to be important in the next five years,” said Burns. “I think there is a huge opportunity for the produce industry to steal some of the plays from the consumer packaged goods companies and their marketing strategies.”
Burns noted that children see approximately 5,500 advertisements each year for junk food from the packaged goods industry, as compared to fewer than 100 commercials for fresh fruit, produce and healthy food.
“We have an opportunity over the next five years to market to children in a major way,” she said. “This is the age group we need to target.”
Children and millennial families are the most important market segment, she continued.
“When we talk about the next generation, they have a choice in what they eat, and marketing works,” Burns continued, noting that in many cases, the older generations are less able to be influenced when it comes to changing food habits. “The landscape of the industry will look very different in five years, especially as it relates to marking, including social marketing, that inspires people to eat more fruits and vegetables.”
Schickler echoed Burns’ comments, saying that the availability of information for consumers will be important, and positive changes will be seen when the younger generation is more engaged by the industry.
“Over the next 10 to 15 years, people will demand healthier and more nutritious diets,” Shah said. “How we market food to children around the world will change.”
Shah also commented that he sees children’s nutrition on a larger scale changing in the future, reflecting what happens with marketing of ag products.
Burns further noted that the ability for the consumer to have a relationship with those who produce their food is increasingly important.
“Whether consumers know who the farmer is by visiting their local farmers’ market or they get that relationship by using QR codes or talking to a produce clerk, we have a great opportunity to develop a relationship with the consumer,” she commented. “The increased availability of information ultimately makes their buying choices easier.”
Sense of normalcy
Over the next five years, Schickler said the agriculture industry will return to a more normal state in terms of prices and competition.
“As we come off recent highs to more normalized prices, I think we will see restored demand,” said Schickler, noting that high prices eliminated some demand. “We will see more demand for livestock production, in particular.”
At the same time, he noted that global competition and trade will also improve to a more normalized level.
As global populations change, agriculture markets will see changes, as well.
“Over the next five to seven years, we will see 1.4 billion people move from the lower class to the middle class, largely in Africa and Asia,” Schickler noted. “They are going to demand meat, milk and eggs.”
The increase in demand will provide great opportunity for agriculture, both in the U.S. and around the world, he said.
Beyond the next five years, Shah said he expects global agriculture to become increasingly important.
“I have a tremendous amount of confidence about the integration of the African food system into the global economy,” he explained. “We’ve seen the trend happen in China, and we are seeing it already with Africa.”
The increasing involvement of these countries in global markets will bring 1 billion additional mouths into the agriculture industry.
Although less concrete, Shah also commented that climate change and the ability of producers to respond to those threats will be a higher priority.
“There are about 2.5 billion producers, farmers, herders and ranchers who are dependent on and vulnerable to the evolution of climate over the next few decades,” he explained. “If we have large-scale investment in science, technology and policies that protect the resilience of those producers, we could have a very good outcome over the long term.”
However, he also added that if the issues are not addressed, climate change will continue to put downward pressure on producers during already challenging times.
James noted, “We know climate change is happening, and we still have other challenges. I hope that in 30 years, we have worked toward resolving these challenges.”
Saige Albert is managing editor of the Wyoming Livestock Roundup and can be reached at firstname.lastname@example.org.