U.S. Processed Food Exports: Growth & Future Outlook

U.S. Processed Food Historical Export Growth

Processed food exports set another record in 2014 with a 2% growth rate and sales exceeding $46 billion.[1] It was the 5th straight year of record growth.  Some food categories grew very rapidly, such as prepared dairy products at 232% growth.[2]  Not only the processed food industry, but also companies in the Standard & Poor’s 500 index are getting more global.  Last year foreign sales grew faster than U.S. sales for these companies.[3]

While Canada and Mexico are the largest buyers of U.S. processed food, with $13.4 and $6.2 billion worth of imports in 2014, respectively, Japan was close behind with $6.2 billion.  China imports $2 billion of U.S. processed food, followed by Korea with $1.8 billion.

Although U.S. processed food exports are high and growing rapidly, the European Union (EU) is the world’s leading food exporter with sales of $91 billion, twice as high as the U.S.  In fact, U.S. market share of total processed food exports has declined in the past 10 years due to strong EU growth and new entrants to food exports such as China, Thailand and Vietnam.

Trends Contributing to Export Growth

The main factors responsible for the fast growth of processed food exports are several, namely:

  1. Higher global demand
  2. High commodity prices lead to increased value
  3. Urbanization
  4. Middle-class growth, particularly in emerging markets
  5. E-commerce

In developing economies the rapid urbanization of workers from rural areas has been a boon for processed food exporters.  China’s urbanized population, only 40% a decade ago, is now 52%.  Japan’s city-slickers are now a staggering 92%.  These urbanized middle class will continue to stimulate demand for premium imported processed foods.

Rising incomes in developing economies is the main reason that the population of “middle class” consumers will increase from 1.8 billion in 2010 to 3.2 billion by 2020.[4]  Of this projected growth, 85% will come from Asia.  While middle class households in developed countries such as the U.S. and Europe will grow 8% by 2020, they will grow 54% in developing markets in Asia, the Middle East and Africa.[5]

Future Outlook

The megatrends highlighted above will continue to propel U.S. exports of processed foods for decades.  In addition, modernization of distribution channels, enhanced supply chain capabilities (including fresh/perishable and frozen), and improved market access such as lower import taxes, will all be favorable to U.S. processed food exporters.  Finally, the emergence of e-commerce has created significant opportunities for cross-border trade of U.S. processed foods.  Of the 600 million Internet users in China, half of them purchase goods on-line.  Many Chinese “e-tailers,” such as T-Mall and Yihaodian, sell U.S. processed foods on their websites.  Similar e-grocery platforms exist in Japan, the U.K., Brazil and other markets, making it easier for smaller U.S. food processors to compete against multi-nationals.

Euromonitor estimates the retail value of packaged foods will increase from $2.3 to $2.6 trillion over the next five years.[6] Much of this $316 billion increase will come in cross-border trade, resulting in greater opportunities for U.S. food processors with innovative products offering high value.  Now is an ideal time to develop or assess your company’s strategic export plans.


1 Food Export, March/April 2015
2 USDA, International Agriculture Trade Report, May 2014
3 Seattle Times, March 15, 2015, D3
4 “The Emerging Middle Class in Developing Countries,” OECD, Working Paper no. 285, January 2010
5 IHS Global insight
6 “Packaged Food,” Euromonitor International, 2015