Food to the USA
Trends and opportunities
The market
The US market with a population of over 280 million offers
opportunities across a diverse range of food products. The
market is heavily regulated and highly competitive,
therefore quality and innovation are important features for
new market entrants.
In 2004, food sales in the US topped US9 billion.
Combined with beverages, the food and beverage category
approaches the US0 billion mark. The US imports
approximately 11 per cent of its food.
Natural and organic food
The ageing ‘baby boomer’ population’s demand for
nutritious, high-quality food has been the most important
food trend in the US in the past decade. According to The
Natural Marketing Institute’s 2005 Organic Consumer
Trends report, in 2004 the natural and organic food
segment generated US.9 billion in sales, up 18 per cent
from 2003.
The term ‘organic’ has a particular meaning and can only
be used if it complies with US regulations. The US
Department of Agriculture provides detailed information on
the National Organic Program.
Specialty food
The specialty food segment has attracted growing
consumer demand and retailer support as the
demographics of the US population change. Formerly
considered to be the food of the elite, gourmet foods are
increasingly being chosen by mainstream consumers. In
the past 10 years, specialty food sales have grown
approximately seven per cent per annum. According to the
NASFT’s State of the Industry Report for 2004, “A
burgeoning US.8 billion dollars was spent on specialty
foods at retail in the US in 2003, proving that American
consumers are willing to pay top dollar for quality foods.”
It is estimated that 55 per cent of all specialty foods sold
are sold via supermarkets. Gourmet/specialty food stores
sell 30 per cent, and the remaining 15 per cent is sold by
delis, department stores, kitchenware stores, gift stores,
warehouse clubs, discounters, mail order and the Internet.
Ethnic food
America is increasingly becoming more multicultural. Foods
that were once confined to ethnic groups are quickly
becoming mainstream favourites. At 37 million, the
Hispanic population is now the country’s largest ethnic
group, and is expected to surge nearly 50 per cent by
2020. Unsurprisingly, Mexican and ‘Nuevo Latino’ foods are
very popular. Salsa, for example, is now the largest-selling
condiment in the US by dollar value. Other popular ethnic
foods include Southeast Asian, Indian and Middle Eastern.
Sales of ethnic foods are expected to increase 50 per cent
over the next decade and generate more than US
million in sales.
Convenience food
Americans work more hours than people from any other
developed country. This busy, demanding lifestyle causes
many Americans to increasingly turn to ‘grab-and-go’ and
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ready-to eat’ items. Key trends are pre-packaged, value
added, easy-to-prepare food with home-cooked/comfort
appeal and a superior taste profile.
Healthy food
The demand for food and beverages that support healthy
diets, weight loss and busy lifestyles are ever-expanding.
In 2004, retail sales were estimated to be US.2 billion,
and are forecasted to reach US billion by 2007. In
recent years, popular US diets have been The Atkins Diet
and The South Beach Diet. However, like most fads, they
are experiencing a consumer backlash – specifically against
the restriction of carbohydrates and the increase in protein
consumption. In response, more Americans are choosing to
consume healthy, high quality food in moderate quantities.
Crowded categories
According to Jay Rosengarten, crowded food categories
include: teas/coffee, salad dressing, pasta/sauces, olive
oil/vinegar, crackers, beans/rice, couscous, cookies/candy
and condiments/mustards.
Opportunities
While brand recognition is extremely high within the
specialty food category, Austrade believes there are
opportunities for Australian producers of both branded and
private-label packaged goods to export their goods to the
US. Products such as soups, sauces and snack foods that
consist of Australian native ingredients like spices or fruit
are appealing to the market, as are products that telegraph
their Australian-ness to consumers.
Tariffs, regulations and customs
The Australia-United States Free Trade Agreement
(AUSFTA) came into force on 1 January 2005. The AUSFTA
is a landmark agreement that gives Australian businesses
expanded access to the world’s largest importer and
investor. Significant export opportunities have been created
through the reduction of tariffs, the increase of specific
quotas, the easing of market restrictions and the
streamlining of investment processes.
The AUSFTA opens up important new opportunities for
Australian suppliers of food items, in both the agricultural
and processed food sectors.
AUSFTA will result in the removal of two-thirds of all US
agricultural tariffs (including lamb and horticultural
products) and the elimination of a further nine per cent of
agricultural tariffs within four years.
Annual beef quota will increase by 20,000 tonnes within
three years, reaching a total of 70,000 tonnes after 18
years. For further information please see the fact sheet on
meat.
For the dairy industry, there are 15-25 per cent reductions
for most cheese tariffs and a rise in quota for duty-free
dairy products at an average compound of five per cent per
annum. For further information please see the fact sheet on
dairy.
In seafood, over 50 items are now tariff free with
reductions between 3-35 per cent. For further information
please see the fact sheet on seafood.
A guide to navigating the AUSFTA tariff schedules is
available from the Department of Foreign Affairs and Trade.
Before exporting to the USA:
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