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Summary of Report

Global Processed Foods Market
Opens Doors for Consumers and Industry

AER-742, October 1996

Contact: Steven A. Neff, 202-694-5381, sneff@ERS.USDA.gov

Globalization of the U.S. processed food sector is in many ways more extensive and varied than the market in bulk commodities, though not as widely recognized. This new report from ERS, Globalization of the Processed Foods Market, describes patterns of international commerce in processed foods.

The report is aimed at providing a more complete understanding of patterns of global commerce in the processed foods sector and the causes and consequences of those patterns. The processed food sector is the largest product manufacturing and distribution segment of the U.S. economy, accounting for more than one-sixth of the nation's industrial activity. In 1994, the total value of domestic food product shipments was $430 billion.

Processed foods account for about two-thirds of international food and agricultural trade. But international commerce in processed foods is more than imports and exports. The most prevalent means by which processed foods reach overseas markets is through sales from foreign operations. Shipments from foreign operations of U.S. processed food firms are 4 times larger than direct U.S. exports

The report examines the impacts of processed food commerce on consumers, agricultural producers, and firms and employees in the food-related industries. The authors also identify the dominant factors that motivate international trade, the operation of foreign affiliates, and other international commercial practices in the processed food sector.

International trade policy is not the only means for influencing global commerce in processed foods. Because of the wide range of strategies used in the processed food sector to reach foreign markets, policies dealing with such things as transportation, communications, product and process standards, and intellectual property are important considerations.

The information in this report should broaden understanding of international commercial activities in the processed food sector and, ultimately, help policymakers avoid policies that have unintended consequences on such commerce.


The report is also available in Adobe Acrobat format: "Globalization of the Processed Foods Market," PDF files.

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