News: Asia Subcontinent
In Sri Lanka, USSEC has had two significant landmarks that helped obtain market access for U.S. Soy: the acceptance of genetically modified (GM) soybean meal for use in animal feeds and a zero customs tariff for imports.
In 2008, Dr. Athula Mahamage was appointed as USSEC’s Sri Lanka country representative and his concerted efforts with local influencers and policy makers helped lead to these accomplishments. As a result of this and the continued tech and trade efforts by Dr. Athula, the U.S. Soy industry has enjoyed a steady increase in the soybean meal market share in Sri Lanka. The country imported about 220,000 metric tons (MT) of soy meal in 2015/16, of which 70 percent is U.S. soybean meal.
However, markets change, policies get altered, and government rules are amended. Caught in one such transformation was the reversal of customs duty on soybean meal that was notified by the Sri Lankan Government in November 2016. The duty, which was set at 15 percent, put Dr. Athula and his team (members of the animal husbandry, finance ministry, and trade associations in the livestock and poultry industry) on alert. They worked strategically to bring the duty down to 5 percent in December 2016. As a next step, the team convinced the authorities at the finance ministry on the importance of soybean meal, which supports a growing poultry/animal feed industry in the country and has successfully gotten soybean meal listed in the Gazette Notification as an “exempted item” for customs duty. Competitiveness for U.S. soybean meal entering Sri Lanka was hampered slightly but has been successfully restored back to its original state.
Market access is a priority area for USSEC’s global market reach. Constraints of different natures exist in different countries and some issues may even crop up from nowhere like the one cited here. Continued efforts in this area ensure markets for U.S. Soy.
In two consecutive events titled “Protein for All,” USSEC India targeted the layer industry to accelerate demand for soybean meal usage. With 83 billion eggs produced last year, India ranks third in the world. The province targeted for this activity, Andhra Pradesh, accounts for 30 percent of India’s egg production. The region is also the leading province for the production of fish and shrimp and figures in the top five provinces for broiler production.
Soy inclusions in the layer sector can swing substantially depending on the price, supply, and availability of other competing sources of protein. Customers recognize that soybean meal is produced using a standard process and therefore the quality of protein is nutritionally superior to other protein sources. In order to build more demand for soy in the layer sector, USSEC conducted two events in this province, set apart by a distance of 124 miles, where the maximum concentration of operations exist. It partnered with the leading poultry industry group, Srinivasa Hatcheries, which helped gather potential customers at the seminars.
Dr. S.V. Rama Rao who represents the Poultry Directorate of the Central Government of India was the lead speaker. A well-known researcher and an accepted guide for the industry, Dr. Rao spoke in depth on the quality and nutritional intricacies of soybean meal and how they affect egg production. USSEC animal utilization consultants Pawan Kumar and Yadu Nandan spoke on the commercial side, guiding the audience on buying skills and supply and demand trends of soy. The consultants also emphasized egg as a low cost protein source for the Indian population and recommended that the government position eggs in their social welfare and feeding programs. USSEC Deputy Regional Lead – Asia Subcontinent (ASC) Vijay Anand wrapped up the discussions by explaining how value addition to soy can be benefit the sellers (crush plants) and how customer demand for full strength soy protein can benefit the buyers (poultry sector).
An estimation made by USSEC consultants helped to quantify the target customers at these two events. The first event conducted in Vijayawada had 110 layer farmers and 8 aqua feed millers who represented 28 million layer bird holdings and 430,000 metric tons (MT) of annual aqua feed milling (layer and aqua). The layer group represented a soybean meal usage of 109,000 MT, while the aqua feed millers represented 86,000 MT. Similarly, the second event held at Rajahmundry, with 130 participants represented 23 million layer bird holdings requiring 92,000 MT of soybean meal in their operations.
USSEC recently attended the Pakistan Edible Oils Conference (PEOC) and visited customers in Pakistan, in addition to holding Asia Subcontinent (ASC) staff planning meetings in India.
USSEC CEO Jim Sutter and USSEC Acting ASC Regional Lead and Marketing Director – Animal Nutrition Pam Helmsing traveled to New Delhi and Agra, India and Karachi and Lahore, Pakistan from January 13 – 26. During that time, they met with customers and potential customers of U.S. Soy in Pakistan to hear about their markets and concerns and talk about the value of U.S. Soy; Mr. Sutter spoke at the PEOC event; and they worked with the ASC team to plan for the execution of existing and future programs.
Mr. Sutter addressed approximately 500 attendees at PEOC, speaking about the value and sustainability of U.S. Soy. After the PEOC event, meetings with Pakistani crushers and feed mills took place.
USSEC’s plans in Pakistan include: technical training for the solvent extractor industry; nutritional expertise for the poultry industry; possible assistance with demand building for poultry, including nutritional information and countering junk science that says poultry is harmful; possible U.S. Soy oil promotion assistance to position soy oil as a premium brand; and the possibility of bringing a group to Kansas State University for soybean procurement training through a U.S. Department of Agriculture (USDA) Cochran grant.
Palm and canola currently dominate the oil market in Pakistan, although soybean imports for crush have increased dramatically. The industry recognizes that oil produced with U.S. Soy is lighter in color and has a lower cost of processing than soy from South America. There continues to be a preference for canola and palm, however, because of higher oil contents and consumer preference. Pakistani crushers are very price sensitive. They admit that they are unable to take U.S. Soy and produce as high a quality of soybean meal as can be imported from the U.S. and are anxious to learn how to improve their processes to do so.
Because purchases of soy by individual companies are rather small, purchases are usually made with multiple consignors. This means competitors are getting the same quality at the same price at the same time, which leads to consensus opinions about the quality and/or issues with product from a given country or supplier. This is true for both soybean meal and whole beans. The industry is moving toward some bulk handling.
The feed industry also recognizes the difference in quality between U.S. soybean meal and meal produced locally from U.S. beans. They note that the quality is improving. The feed industry is sophisticated and recognizes the value of U.S. Soy, both intrinsic and extrinsic advantages, and is looking for ways to calculate what premium they can afford to pay for U.S. origin.
The poultry industry has been growing at a rate of eight to ten percent yearly, but there are some plateau years. Profitability is low, with chicken at about two-thirds the price of lentils. The two major barriers to growth in chicken consumption are poverty and misinformation about the quality of poultry meat. The Pakistan Poultry Association is planning a feeding program at a few public schools, providing eggs and chicken legs to children and will collect data to show improvements in health, school attendance and learning.
USSEC recently conducted a soy demand-building event in Kandy, Sri Lanka as an extension of a two-day national event planned by the Sri Lankan government to educate audiences about protein. About 500 participants attended this event with a significant group including influencers from the government, scientists, and representatives from the animal feed and protein trade industry.
USSEC consultants in Sri Lanka and southern India, Dr. Athula Mahagamage and Dr. Yadunandan, led the conference. Dr. Mahagamage delivered a lecture on importance of protein and how Sri Lanka has been able to increase the production of chicken and eggs to meet growing demand. The session was also used to demystify perceptions about processes employed in chicken production, which was identified as a minor constraint that hampered chicken consumption in the country despite stable demand. During his lecture, Dr. Mahagamage shared data on the utilization of U.S soybean meal in the Sri Lankan poultry industry, emphasizing that the quality meat and positive economics seen in production economics are due to the superior quality and consistent supply of U.S soybean meal.
Drs. Mahagamage and Yadunandan also conducted a closed room discussion with the animal husbandry department, poultry farmers, and veterinary college faculties. Participants agreed on the importance of developing further strategies to increase chicken and egg production in Sri Lanka. Mr. Jayan, owner of Jaya farms, a leading poultry enterprise, pointed out that how U.S soybean meal has contributed to the development of Sri Lanka’s poultry industry.
Mithreepala Sirisena, president of the Democratic Socialist Republic of Sri Lanka, attended the event’s second day. The 304 participants included officials from various government departments, teachers, animal husbandry officials, poultry farmers, and feed millers. Dr. Mahagamage invited two external speakers, Dr. Gamini Jayakody, consultant physician to the World Health Organization (WHO) and Ministry of Health and Dr. Nimal Priyankarage, head of nutrition at the Veterinary Research Institute, to speak at the event and focus on nutrition and nutritional factors. Dr. Priyankarage spoke on high quality protein and how to differentiate complete and incomplete proteins. While speaking on amino acid composition in vegetable and animal proteins, he stressed that only soybeans offer an almost complete profile of amino acids.
USSEC India recently organized a training program, which dealt with economical approaches to chicken production and creating trade linkages to South India’s broiler sector, in Ooty, Tamil Nadu Province. USSEC partnered with a leading soybean meal trader, Sri Amman Enterprises, to help achieve its objectives.
USSEC consultants Dr. Yadunandan and Dr. Pawan Kumar coordinated the sessions to bring together poultry integrators, feed millers, and the soy distribution system. About 110 midsized and small broiler integrators and feed millers participated in this training program. Together, this group represented 460,000 metric tons (MT) of soy use per year. Sri Amman Enterprises handles sales of 130,000 MT of soy annually and Sai Smaran Foods Pvt Ltd crushes 200,000 MT of soybeans per month. The audience at this event involved the entire value chain of soy, comprised of crushing, distribution, and soy utilization.
Dr. Yadunandan introduced USSEC and its activities and gave a presentation on the supply and demand of soybean meal in India and the Asia Subcontinent (ASC). India produced a good soybean crop in 2016 after three back-to-back years of poor production, but India’s supply is not enough to cater to the needs of the entire ASC region. Discussions stressed the need to proactively address raw material security for a growing poultry industry. Dr. Kumar expressed that chicken, eggs, and soy flour are the three cheapest sources of protein for Indians and stressed higher dependence and consumption of the same. On the technical front, the two consultants explained soybean meal inclusion levels in formulations and the bearing they have on the economical production of poultry meat and eggs. Other topics addressed included making appropriate buying decisions of soybean meal and interpreting analytical data.
USSEC participated in the Pakistan Edible Oil Conference (PEOC) in Karachi, Pakistan on January 21.
USSEC CEO Jim Sutter spoke to attendees on the topic “Soybeans: Sustainably Produced and Packed with Protein.”
In addition to talking about the sustainable manner in which U.S. soybeans are produced and explaining how sustainability is a new benchmark, Mr. Sutter also discussed growing protein consumption around the world and how to evaluate protein.
The presentation’s positive message focused on how consumers are demanding sustainably produced products, which U.S. Soy can deliver.
USSEC, in collaboration with the Association of Food Scientists and Technologist (India), Soy Food Promotion and Welfare Association, Soy Processors Association and Solvent Extractors’ Association of India recently organized a one-day conference, “Soy Nutrition and Soy Opportunities: Creating Linkages” in Mumbai, India.
With nearly one-third of the Indian population suffering from malnutrition and a similarly equal number of people suffering from diet-related degenerative diseases such as cardiovascular disease (CVD) and diabetes which are on the top of the causes of deaths in most parts of India, especially among the urban population. It is estimated that more than 63 million Indians are suffering from diabetes and 45 million with CVD.
Cardiovascular diseases are major causes of mortality and disease in the Indian subcontinent, causing more than 25 per cent of deaths. It has been predicted that these diseases will increase rapidly and India will be the host for more than half the cases of heart disease in the world within the next 15 years. Moreover, India is home to the largest population of severely malnourished children in the world, and child malnutrition is a risk factor for 22.4 percent of total burden of disease. Malnutrition is more common in India than in Sub-Saharan Africa. Despite significant efforts, the reduction in the prevalence of malnutrition in India over the last decade has been small.
Soy is a highly nutritious food. Soybean is one of the very few plants that provide a high quality protein with minimum saturated fat. Soybeans contain all the three macronutrients required for good nutrition, as well as fiber, vitamins and minerals. Soybeans help people feel better and live longer with an enhanced quality of life. Soy contains 40 percent protein, making it higher in protein than any other legumes and many animal products. Protein in just 250 grams of soybean is equivalent to protein in 3 liters of milk or 1 kilogram of mutton or 24 eggs.
-Dr. Ratan Sharma, USSEC Director – India & ASC Soy Food Program
Dr. Sharma discussed various soy products including soymilk, tofu, soy nuggets, soy fortified wheat flour and gram flour, and soy-based dal analogue, suggesting that these products have been made by using high end processing technology and are tasty and safe for consumption. He further emphasized that soy could be a wonderful solution to reduce the protein calorie malnutrition in India, and the Indian government should include soy as a main nutritional ingredient for various supplementary nutrition and welfare programs to ensure a healthy young generation.
Dr. Sharma pointed out that soy fortified wheat flour can be widely used in the Public Distribution System, saying that India imports more than five million metric tons (MMT) of the dal (lentils) from other countries. He suggested that the government promote the soy-based dal analogue, which is an extruded product by using wheat, soy and corn. This dal analogue is similar to India’s regular dals in cooking characteristics and taste, but is much cheaper than regular dal and superior in nutrition. This can reduce the import burden to the government up to a great extent.
U.S. Soy grower leaders visited Nepal for the first Asia Subcontinent Trade Buyers Conference (ABC2016) from November 8 – 11.
The Asia Subcontinent Buyers Conference marked the region’s first buyers’ conference. USSEC, along with the support of the U.S. Grains Council (USGC) and the U.S. Department of Agriculture (USDA) offered the conference as a regional opportunity for buyers and sellers of U.S. soy, corn, and grain to promote additional knowledge through which stronger relationships can be built for a prosperous and stable future.
The Asia Subcontinent (ASC) region, comprised of the countries of Bangladesh, India, Nepal, Pakistan and Sri Lanka, has emerged as a relatively new market for U.S soy and corn products. International commodity traders and exporters as well as buyers from the ASC region have shown growing interest in exploring opportunities and seeking solutions for the continued demand of agri-inputs. The U.S. agriculture sector has made significant contributions in this region by providing solutions and support to various industries’ technical and trade needs and is considered to be a preferred supplier of services and commodities.
USSEC chairman and American Soybean Association (ASA) director Jim Miller presented remarks on sustainability on his farm.
ASA president Richard Wilkins provided an overview of the U.S. political landscape post-election, the possible effects on U.S. agriculture, and also discussed sustainable practices on his farm.
USDA provided a regional overview from the viewpoint of U.S. agriculture, while USSEC and USGC provided a look at the ASC market, including how the region’s market demand has developed over the past five years, present developments and future requirements by 2020.
With the continued growth of U.S. soybean exports to Pakistan, USSEC has taken on responsibility for trade and technical serving efforts targeting oilseed crushers, feed millers, and the poultry industry. U.S. Soy family efforts began in the 1990s when Pakistan used minimal levels of soybean meal in their poultry rations and sourced what they did use primarily from India. During the last five years, the American Soybean Association’s (ASA) World Initiative for Soy in Human Health (WISHH) has built on the original work and expanded the commercial network for the U.S. Soy value chain in Pakistan; one strategy has involved leveraging soybean farmer resources with U.S. Department of Agriculture (USDA) funding from programs such as the FEEDing Pakistan aquaculture project. Over the past 20 months, Pakistan has imported over 393,000 metric tons (MT) of whole soybeans and soybean meal from the United States, for an estimated value exceeding $140 million.
WISHH and USSEC are now executing a shift of programmatic responsibilities, and ensuring that adequate FY 2017 funding is available to further develop U.S. Soy markets in Pakistan. The FY 2017 initiatives include trade servicing and technical assistance as well as information exchanges on the large and complex Pakistan market. USSEC will provide technical assistance to Pakistani buyers and crushers and support their participation in USSEC training and exchange activities.
As USSEC takes on the management of most market development activities, WISHH will complete the final year of the FEEDing Pakistan aquaculture program, which has built a market for soy-based floating fish feed and introduced tilapia to the commercial market. WISHH will continue to pursue similar, non-traditional funding in Pakistan (outside of the usual USDA/Foreign Agricultural Service (FAS) funding streams of the Market Access Program (MAP) and Foreign Market Development (FMD) in close collaboration with USSEC.
“The progress in the Pakistan market shows that WISHH is a trailblazer for the U.S. soybean trade,” said WISHH committee chair Daryl Cates.
“We are proud to build on many years of U.S. Soy activity in Pakistan,” added USSEC chairman Jim Miller. “We look forward to taking on key programs in Pakistan to create further demand for U.S. Soy by providing our full range of services to Pakistani Customers – these will include technical and trade servicing plus applicable market access work. We also look forward to collaborating with WISHH who will be finishing out the fourth year of their Feeding Pakistan Aquaculture Project in fiscal 2017.”
WISHH is a trade-development program, headquartered at the American Soybean Association, in St. Louis. Since U.S. soybean farmers founded WISHH in 2000, it has worked in 24 countries to develop long-term markets for U.S. soybean farmers while fueling economic growth and value chain development.
The U.S. Soybean Export Council aims to maximize the use of U.S. Soy internationally by meeting the needs of global customers that use U.S. Soy in human food and feed for poultry, livestock and fish. The organization uses a global network of stakeholder partnerships, including soybean farmers, exporters, agribusinesses, agricultural organizations, researchers and government agencies, to accomplish that mission. USSEC programs are partially funded by the United Soybean Board (USB) and by Foreign Agricultural Service funds provided by the American Soybean Association.
USSEC, in cooperation with India’s PHD Chamber of Commerce and Industry, recently organized a workshop on the role of soy in health and nutrition in New Delhi.
J.P. Meena, Special Secretary, Ministry of Food Processing Industries, wants to establish a partnership between soy producers and processors, given soy’s protein and other nutritional value for large-scale consumption. Mr. Meena emphasized the role of soy to combat malnutrition in India and suggested a large-scale campaign similar to the one promoting eggs to be launched for soy products as well.
USSEC Director – India Food Program Dr. Ratan Sharma spoke at the event, describing soy’s nutritional qualities: “Soy is a highly nutritious food. Soybeans are one of the very few plants that provide a high quality protein with minimum saturated fat.” He continued, “Soybeans contain all of the three macronutrients required for good nutrition, as well as fiber, vitamins, and minerals. Soybeans help people feel better and live longer with an enhanced quality of life. Soy contains 40 percent protein, making it higher in protein than any other legumes and many animal products. Protein in just 250 grams of soybean is equivalent to protein in 3 liters of milk or 1 kilogram of mutton or 24 eggs.”
Dr. Sharma also discussed various soy products, including soy milk, tofu, soy nuggets, soy fortified wheat and graham flour, and soy-based dal analogue, saying that these products have been produced using high-end processing, and that they are tasty and safe for consumption.
He further accentuated that soy could be an excellent solution to reduce the protein calorie malnutrition in India and that the Indian government should include soy as a main nutritional ingredient for various supplementary nutrition and welfare programs. Dr. Sharma pointed out that soy-fortified wheat flour can be widely used in the public distribution system and that India imports more than five million metric tons (MMT) of dal (lentils) from other countries. He believes that the government should promote soy-based dal analogue because it is less expensive than traditional dal and superior in nutrition.
John Slette, Senior Attaché for Agriculture Affairs at the U.S. Embassy in India, emphasized the role of soy in food and nutrition security in the country. Mr. Slette was very positive about the efforts that the Indian government is making to fight malnutrition and suggested that soy products could be a cheaper source of protein for India’s population.
As part of its larger mission to the Asia Subcontinent (ASC), the QSSB team visited Sri Lanka on July 30 and 31, where they participated in an industry meeting and visited a feed mill, layer farms, broiler farms, and chicken outlets.
The delegation attended the “Lanka – U.S. Soy Alliance.” This networking meeting helped the U.S. Soy representatives to interact with and learn about the Sri Lankan industry. About 55 participants attended the meeting where two leading industry members discussed the Sri Lankan industry’s progress and growth.
At the meeting, USSEC Country Representative – Sri Lanka Athula Mahagamage and the Sri Lankan industry representatives provided an overview on the Sri Lankan market for U.S. Soy, animal feed operations, consumption patterns, possible applications for soy in human food, and future growth opportunities.
USSEC CEO Jim Sutter emphasized and assured USSEC’s and the U.S. Soy industry’s support to the Sri Lankan industry and discussed USSEC’s activities worldwide. He compared Sri Lanka’s market to India’s and said that Iowa is 2.2 times the size of Sri Lanka. He continued to compare dry, value-added chicken versus the wet market (packaged versus birds that slaughtered on the spot. He said that the U.S. currently has a 100 percent market share in Sri Lanka.
Participants received the opportunity to know more about Sri Lankan opportunities and potential through one-on-one discussions over dinner.
The team also visited a feed mill, Gold Coin Feeds, where they saw stocks of U.S soybean meal, while a visit to a modern broiler farm indicated growth in the poultry industry. The trip to the farm also allowed the team to observe Sri Lanka’s countryside.
At the broiler operation, the delegation learned that each year, it processes 30,000 birds per shed per cycle of 36 days when they are harvested at 4.5 pounds. The 6-8 sheds are modernand environmentally controlled. The mortality rate is 2 percent and it uses no antibiotics and performs no debeaking.
By contrasting many small “mom and pop” grocery stores, the delegation had the opportunity to compare modern retailing and customer preferences to various food and grocery products. For example, the Pussala Meat shop demonstrated Sri Lanka’s chicken processing and retailing. 95 percent of the country’s poultry industry relies on processed, chilled and/or frozen chicken.
The QSSB team undertook 5 different activities in a span of 28 hours in Sri Lanka.