A conversation with?
Mark Lyons, Global Vice President and head of greater China for Alltech who spoke at the recent National Institute for Animal Agriculture meeting in Columbus.
OCJ: What are some things you want farmers to know about what their consumers in China are looking for?
Mark: I would say that the first thing is that it is a market that is developing quickly, food tastes change a lot and at the same time there is a perception that American products are high quality. There is a desire for those products. I think a lot of us were quite skeptical and nervous when there was a Smithfield acquisition and what we have seen from that is that they have put out all the branding. It says Smithfield and there?s an American flag there, they really use that as a way to sell a premium product. We?ve seen over the last few years, more than a doubling of pork imports from the U.S to China. I think that same type of model can be followed with other commodities. We can find U.S. beef in China, it?s probably coming from Hong Kong, but that market is also a huge potential, as is poultry. I think if we can resolve a few of the political issues maybe that could open up an opportunity we hope. Agriculture is probably more politically sensitive to China than it is in the U.S. right now, at least with these two administrations. I think the other piece that?s kind of a funny thing, one of the chefs in Beijing right now is actually from Cleveland, Ohio and works in one of the 5-star hotels and is one of the top three chefs in Beijing. There are other opportunities and there are people like that talking about high-quality food that he can get back home and trying to bring more of that in.
OCJ: Those consumer-to-producer relationships are going to be really important no matter what the administrations are talking about. An economist here in Ohio said that one of the bigger threats to U.S agriculture is Donald Trump?s Twitter account out of concern that it could make the folks in China upset and they could reduce of eliminate U.S. agricultural imports. How legitimate of a concern is that?
Mark: I think the comments around very sensitive areas are a concern. The way that China approaches these things is all very smooth on the surface and they have the tougher talks one-on-one in private and I think that conversation can be very devastating. I think they have a pretty sophisticated understanding of how our political system works and I think they also understand that in a way, you have a president or an individual who is sometimes speaking on behalf of his country and sometimes speaking on his own. The overall sense that I have gotten is that in the beginning it was a much greater concern, but in the last few months it?s been more about maybe this is something we can work with type of thing for China. I think whether it?s the North Korea stuff or other more pretentious issues, it?s probably not very helpful, but at the same time I think they are well prepared. Probably the biggest concern is how prepared are we and how do those things work out. In general, I think in agriculture we have the chance to have a very ag-focused ambassador. Governor Brandstad from Iowa as ambassador from the U.S to China is very positive. He is very good in his actions and he understands agriculture so that?s something that could work out. I think we can remain positive.
OCJ: You also talked about having the right mindset going into this and looking at opportunities not just in China but other countries in the region. What are some bright opportunities you are seeing out in that region in the world that we need to be thinking about?
Mark: One that I think will surprise people is Vietnam. The image of Americans in Vietnam is so positive and that?s found as so weird to us. That is a place that?s really blossoming with over 20% growth in feed production in Vietnam right now. There?s tremendous development in that market and I think that?s something to think about. There?s a lot of other markets that are coming in that might be even more interesting to people. Mongolia can be a very interesting place to go if you wanted to raise a grass-fed beef type of product or feedlot finished or put some sort of hybrid system together. You are looking at these big green grasslands and a very interesting terrain and story. There are so many different markets and then you have your higher end markets like Korea and Japan that are consistently looking for quality and I think engaging in those markets and finding new quality attributes that they like and being able to meet those is a huge value added position. There?s an incredible number of different types of markets and I think it?s a matter of going there, learning about them and looking at which ones fit your production systems and what you are interested in.
