*EPF210 04/24/01
Animal Products, Produce Growing Parts of World Food Trade
(Demand for higher-quality food also rising, report says) (480)
By Kathryn McConnell
Washington File Staff Writer

Washington -- Increased incomes worldwide, greater global availability of food, multilateral rules affecting trade, increased urbanization and certain factors affecting consumer preferences are causing a shift in the kinds of food in demand worldwide, according to the U.S. Department of Agriculture (USDA).

Over the past four decades, food purchasing power has increased for most consumers in the world as real per capita incomes have doubled, on average, USDA reports in the May 2001 "Agricultural Outlook." Higher incomes in both developed and developing countries have shifted demand toward more animal products, produce and higher-quality products and away from "basic products," such as roots and tubers.

As urbanization has increased -- most dramatically in developing countries -- preferences have shifted toward a wider variety of foods than is available in rural areas, according to the USDA magazine's article, "World Agriculture and Trade."

Among food trade trends noted by the magazine:

-- Growth in two-way trade of higher-value agricultural products has boosted world trade overall without an equivalent growth in consumption. For instance, the United States exports high quality beef products and imports lower quality beef; the U.S. exports lower quality dairy products, such as powdered milk and whey, and imports higher quality dairy, mainly cheese.

-- Food accounts for 47 percent of consumers' budgets in lower-income countries and 13 percent in higher-income countries.

-- Population and income growth in developing countries, coupled with limited domestic food production resources, means that these countries will have to rely more on imports to meet their food needs.

-- World demand for meat has grown significantly. U.S. meat exports are now seven times greater than in 1980 and account for nearly 13 percent of all U.S. agricultural exports.

-- In Europe, recent outbreaks of what is known as mad-cow disease have led to "dramatic declines" in beef consumption there and "significant economic losses" for associated industries.

-- Demand for organic foods -- though small -- is expanding worldwide, particularly in Europe, North America and Japan, where up to 30 percent of consumers say they buy organic food products regularly.

-- Consumer quality and other demands are leading to changes in how foods are produced, marketed and traded in Europe and to some extent in the United States. Animal welfare concerns have led to new livestock production and processing regulations in much of Western Europe. Evolving consumer demands are causing policy makers to work toward multilateral approaches to issues related to differences in food regulations and standards among countries.

-- Demand for foreign brands of packaged and bottled products has made beverages one of the fastest growing categories of world food trade.

(Distributed by the Office of International Information Programs, U.S. Department of State. Web site: http://usinfo.state.gov)
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