The core drivers for demand across the countries of ASEAN are population and income growth – but those drivers are of different scale in different nations. For example, as Singaporeans seek more high-end steaks and cheeses, Indonesians seek fresh beef, while the citizens of a number of countries seek new varieties of noodles and bread, from Australian grain
Beef is a good case study. Demand for beef will stay strong in Indonesia. However live cattle exports will be challenged by Indian buffalo. Meanwhile there is high growth among the ASEAN middle class for “branded beef”. That is particularly the case for steak which the consumer knows is grass fed/grain fed.
In Australia we are talking about Wagyu, Angus, Hereford; regions with strong provenance such as Western Victoria or the Northern Rivers) and characteristics such as marbling score and age. Critically, richer data will mean the consumer will have many more details.
A future for agtech
As agtech – agricultural technology – develops we will likely see the use of developments such as blockchain so the consumer will have certainty on the exact origin and the supply chain. This is already being trialled by an increasing number of meat producers. Traceability is very important to the middle class ASEAN consumer
Similar advances in both consumer and producer sophistication – in an environment of global market forces – are happening in grain, dairy and horticulture.
There is a growing demand for specialised milk products – A2 milk is a great example. Australian branded cheeses and yoghurts have appeal, Infant milk formula will continue to be in great demand, though trade volumes will change, as new Chinese regulations prevent many global companies from entering China’s IMF market.
There are, of course, risks for Australian companies. ASEAN’s growth is not just attractive in the Antipodes. Even as the Black Sea region competes for grain buyers, local ASEAN nations are building local production.
These markets can be very difficult to navigate if you’re new to these countries. Often that means finding the right partner – and services such as Austrade can be vital. Finance too and an experienced partner are essential – and I’m pleased to say that’s where ANZ excels.