Iowa's Secretary of Agriculture, Mike Naig, and his 15-member delegation just returned home from a trade mission to Vietnam and the Philippines, two countries that rank in the top 10 US agricultural export markets. Iowa's reputation as a dependable supplier of high-quality agricultural products is expected to unlock new opportunities in the Indo-Pacific region.
Iowa’s Secretary of Agriculture Mike Naig led a 15-member delegation to Vietnam and the Philippines from March 24 to April 1, 2023, to identify new opportunities for Iowan farmers and help meet food demands of growing middle-class populations in both countries. The delegation was coordinated by the Iowa Economic Development Authority (IEDA) and included visits to Ho Chi Minh City, Vietnam and Manila, Philippines.
The delegation included Iowa-based business leaders and representatives from the Iowa Beef Industry Council, Iowa Corn, Iowa Farm Bureau Federation, Iowa Pork Producers Association, and the Iowa Soybean Association. IEDA worked with the US Grains Council, US Meat Export Federation, and the US Soybean Export Council to identify business prospects for the delegation. The mission focused on livestock, grain, and the meat processing industries.
In both countries, the Iowa team met with industry partners, government entities, commodity importers, and agricultural interest groups to engage in trade discussions. The goal of the trip was to promote business growth, foster stronger economic relationships, and explore new opportunities for exports from Iowa.
According to the latest figures by the US Department of Agriculture, Iowa shipped $10.3 billion worth of domestic agricultural exports overseas in 2017, cementing its position as the second-largest state in the United States for exporting farm products. The state’s top agricultural export products include soybeans, pork, corn, and grain products.
Iowa’s economy heavily depends on exports, but farmers could see tighter profit margins in 2023 with some countries reducing their import of American products. US Department of Agriculture predicts a $11.9 billion drop in agricultural exports between 2022 and 2023, with exports estimated to be $184.5 billion in 2023, down from $196.4 billion in 2022.
Chad Hart, an agricultural economist at Iowa State University, said that global inflation has contributed to the pressures being felt on US exports, especially as geopolitical uncertainties have interrupted some trade flows, including the ongoing war in Ukraine and US-China tensions.
Hart added that there are emerging markets, such as Central America, South America, and Southeast Asia that can help offset some of those losses.
Vietnam and the Philippines are both ranked in the top 10 US agricultural export markets in 2022. Vietnam was the second-largest soybean market for US exports in 2022 and is recognized as one of the fastest-growing feed markets in the world. In 2022, Iowa companies exported $227 million in agricultural goods to Vietnam. One barrier to increased US trade with Vietnam is the lack of a free trade agreement between the two countries, a benefit enjoyed by all the nation’s other major trading partners, said Iowa Farm Bureau Federation (IFBF) President Brent Johnson.
The Philippines is also an important export partner for Iowa. In 2022, Iowa companies exported $273 million in agricultural goods to the Philippines, and the country was the ninth-largest US ethanol importer in 2021. The Philippines, as Southeast Asia’s second most populous country with a need for consistent food access, offer both trade and industry development opportunities.
“Vietnam and the Philippines are already important trading partners for Iowa, but we have an opportunity to increase our market share because of their growing populations and our longstanding reputation as a dependable, proven, and consistent supplier of high-quality products,” said Secretary Naig. He expresses optimism for a future increase in beef and pork exports to Southeast Asia, as the region’s animal protein consumption is expected to increase by 20% over the next five years.
Vietnam and the Philippines are not the only export markets with potential for expansion in the region. In February 2023, Secretary Naig led a trade mission to two other key export markets, Japan and South Korea.
Asia has become an increasingly important partner for various US states. In November 2022, Oregon Gov. Brown led trade missions to Japan, South Korea, and Vietnam to promote Oregonian products. In May 2023, Michigan plans to organize trade missions to Thailand and Vietnam to advertise Michigan-made products, services, and technologies.
Overall, Iowa's recent trade mission to Vietnam and the Philippines has highlighted exciting opportunities for the state's agricultural exports to Southeast Asia. With a growing middle class in both countries, Iowa's reputation as a dependable supplier of high-quality agricultural products has positioned the state to capitalize on these emerging markets. As other states also look to expand their global reach, trade missions such as this one will be critical to US economic growth and success.
Van Tran is a participant in the Young Professionals Program at the East-West Center in Washington. She is an undergraduate student majoring in International Studies at Rhodes College, with a concentration in democracy & governance, Asian Studies, and immigration.