Tim Loh, U.S. Soybean Export Council (USSEC) Regional Director – Southeast Asia, describes the diverse economies in soy-buying markets like Thailand, Vietnam, Philippines, Indonesia and Malaysia, as well as growing soy markets such as Myanmar, Cambodia and Laos, which collectively make up the Southeast Asia region.
Q: How would you describe the South East Asia market? How is U.S. Soy used there?
A: We have a large population of around 640 million people. Southeast Asia is one of the largest importing regions for agricultural products out of the U.S. There is also big demand for imports of aquaculture products. Consumption of animal protein is still relatively low, but there is an increasing need for soybeans and soybean meal for animal feed rations.
Q: Your region includes many countries. Which is the biggest market for U.S. Soy and how is it perceived there?
A: The Philippines is our largest market. In fact, it’s the largest market outside of the U.S. for soybean meal. The perception in this market is that U.S. meal is of a higher value; the quality is good, it’s consistent, and they appreciate the amino acid profile of U.S. soybean meal. They understand the value and how it translates to a better profit in terms of animal performance.
Q: Is U.S. Soy perceived differently in other Southeast Asia markets?
A: Customers are starting to realize that they get better value using U.S. soybean meal. The cost of their feed is competitive; if they use U.S. soybean meal, they don’t have to spend money on additional ingredients because U.S. soybean meal has a good complement of amino acids and energy. If your animals aren’t able to get the full nutrient value of the meal, their growth is not as good.
Q: Is sustainability important to buyers in Southeast Asia?
A: Sustainability is still a notion that is developing in Southeast Asia. Sustainability is very much a consumer-driven requirement. In our part of the world, while companies are aware of sustainability, it is very much a work in progress.
Q: How does USSEC support Southeast Asian soybean buyers?
A: USSEC’s Southeast Asia regional office in Singapore started in 1979. So there’s been a long, dedicated commitment. The work that USSEC does is largely divided into two major areas: trade servicing and technical servicing. Trade servicing is helping our buyers make informed decisions. It’s important to have informed buyers so they know that when they buy from the U.S., they are getting the best deal. We have many programs that educate buyers on the market price and risk management so they can act independently. Technical servicing is when we conduct activities to show buyers the value of U.S. soybean meal, helping them to focus on what’s inside the protein, and that’s the amino acids that animals can use in their growth. Through these efforts, we connect buyers to the U.S. supply chain.
Q: Do you think it’s important for growers in this region to meet the farmers who grow U.S. Soy?
A: I think it’s very important for our crushers to meet the U.S. soybean farmers. The product we’re looking at is a commodity, and we want to de-commoditize U.S. Soy. We consider the value to be much higher than products coming from other countries. The best way to bring that value across is to put faces of the growers to the product, to convey the principles and priorities of the growers. The experience of an actual handshake cannot be replaced.
Q: What is the future hold for U.S. Soy in Southeast Asia?
A: Southeast Asia will continue to be one of the growth engines for the global economy. We are a growth region. Collectively, we have one of the largest economies in the world, and our GDP is very strong. Because of that, international trade is very vibrant in Southeast Asia. We rely heavily on international trade because many of the countries are deficient in agricultural products. So they have to import a lot of ingredients to sustain the feed industry. As our region grows we’ll see that slope of international trade continue to increase.
Q: When talking with buyers in your region, how do you communicate the advantages that U.S. Soy provides?
A: The U.S. Soy Advantage is really focused on two areas. First, the intrinsic value of U.S. Soy. This includes the inherent values, like better amino acids, higher energy and consistency of the product. The other area is the extrinsic benefits of U.S. Soy; the strong logistics of the delivery systems and reliable contractual relationships with suppliers in the U.S.
Q: Is it difficult to put the U.S. Soy Advantage into words, or is it a concept buyers grasp quickly?
A: We sell the U.S. Soy Advantage message to our customers but nothing beats having them here to see for themselves the high level of commitment U.S. soybean producers have, the sustainability they have and meeting with the suppliers, coming face-to-face. Being able to bring them to the U.S. to experience the production system is critical. No other organization puts a face to the product like that.