(DES MOINES, IA) — Agriculture trade policy continues to be a top of mind issue for many stakeholders in the industry; from farmers and ranchers to agribusiness and elected officials across the country. And as trade relationships change and shift over time, there remains one market that seems to be very untapped for U.S. agriculture and that is India.
Iowa Secretary of Agriculture Mike Naig recently returned from a trade mission to India and he uses the words “potential and opportunity” when describing what a trade relationship between the country and the U.S. could mean for American agriculture.
“Yeah, you’d say words like opportunity, words like potential are what you go thinking and you come home confirming,” says Naig. “And let me say it this way, India is now the largest country in the world by population. They’ve exceeded China, over 1.4 billion people. And they’re a growing economy. In fact, you know, they very much could be the third largest economy in the world in the next few years. So tremendous GDP growth. They’ve got a young population. They’re projecting, in the next couple of years, that their middle class will exceed 500 million people. Again, the middle class will exceed the entire population of the United States. Well, what do you want when you’re popular, when your income is rising and you’re joining the middle class, you want variety on the plate, you want access to to more protein.”
Naig says though that India has some challenges with infrastructure and productivity that they need to address and they will need to allow some outside food and ag products in.
“They’re number one in the world in terms of the area that they cultivate, for rice and wheat, but their number two in total production, and yet their productivity is something like 11 or 12th,” says Naig. “Dairy, they’re the largest dairy producing country in the world. But their productivity is only like 26% of US productivity, right? So they’ve got a huge productivity gap that they could improve through allowing genetics in genetic improvements, they do not allow GMOs to be cultivated or imported into the country. That’s something they’re going to have to address, I believe, if they’re going to be productive.”
“Now, flip to the other side of this right now, we’re already exporting ethanol into the country,” continues Naig. “They do not use it yet in their transportation fuel, and they are pushing for E 20 and beyond. And so we think that’s a golden opportunity, one for them to grow their ethanol industry domestically, but also to import. We think there’s a huge upside for ethanol into India. The other would be around feed. I mentioned protein. They’ve got significant protein needs, poultry, yes, some pork, dairy, egg. They need more feed for those livestock sectors. And so we think that soybean meal and DDGs are probably some of the early, early wins that we could achieve there, get those products in, and you know, that could be a huge upside as well.
Naig added that he doesn’t think India will ever be able to produce all that they need themselves and eventually the U.S. could be a supplier of corn, soybeans and more beyond that in years ahead.
Hear the full conversation with Iowa Secretary of Agriculture Mike Naig, including comments on fall harvest, Farm Bill, HPAI and more on Wednesday’s episode of Agriculture of America. Check local listings; podcast coming soon.