July 11, 2024

This paid piece is sponsored by South Dakota Biotech.

Representatives of key South Dakota industries, including biotech, have returned from Japan and Taiwan with multiple new business opportunities to pursue.

The trade delegation led by Lt. Gov. Larry Rhoden, recently spent a week visiting the two countries as part of a coordinated effort between South Dakota Trade and South Dakota Biotech.

“It was great,” said Joni Ekstrum, executive director of South Dakota Biotech. “I highly recommend companies looking to export go on a trade mission. The ROI, of course, is yet to be determined, but I think there are going to be relationships that develop as a result of this, even if they take some time.”

The biotech industry “is very important to both Japan and Taiwan,” she added. “In Taiwan, we toured a research institution that was amazing — they did everything from food to pharmaceuticals — and they’re the nation’s leading research institute. They want to expand internationally, and we had some promising conversations about how we may be able to work together. Their capabilities are extremely strong, and I’m excited to introduce both startups and larger companies because I can see it being a beneficial relationship.”

That’s the goal of the trade delegation, said Luke Lindberg, president and CEO of South Dakota Trade.

“As an industry leader, Joni will now go back to her companies and share the experience and the focus on areas she learned about on the trip and share that there may be business opportunities to engage in,” he said. “And South Dakota Trade is here to help connect with those groups and businesses and help determine an export strategy.”

The two organizations already worked together in advance of the trade mission. Ekstrum chairs the steering committee that helps advise South Dakota Trade and was key in identifying priority markets, products and challenges to exporting, Lindberg said.

“We used that as sort of our playbook when it comes to trade missions,” he said. “East Asia was a strategic opportunity for a number of key sectors of South Dakota’s economy.”

Japan is South Dakota’s fourth-largest trading partner, and Taiwan is a leading per capita importer of American agricultural products.

“If you look at what we are selling to the world, ag by far is our No. 1 export product, and a lot of the reason we’re able to successfully sell overseas is because of America’s investment in the biotech sector,” Lindberg said. “We produce more crops per acre than ever, and that’s been driven by innovation in biotech. So often we’re educating foreign buyers on the safety and efficiency of our biotech crops as we build long-term relationships.”

For Houdek, a South Dakota Biotech member that participated in the trade delegation, there was strong interest in the company’s aquaculture operation, which has gained international acclaim for its use of fermented plant protein to have a positive impact on the global aquaculture industry.

One of the state’s leading exporters, more than 80 percent of the company’s manufactured products are exported to international markets.

“This allows us to use locally grown soybeans from South Dakota farmers and locally processed soybean meal from South Dakota soybean processors, upcycle it through patented fermentation technology originally developed by SDSU professors and distribute it to aquaculture feed and pet food manufacturers worldwide,” CEO Mark Luecke said.

“These higher-value uses of South Dakota-grown products put more money back into our local South Dakota communities.  It is a full-circle South Dakota success story.”

Houdek, recently named South Dakota Small Business Exporter of the Year by the U.S. Small Business Administration, already has some relationships in Asia and was represented in the delegation by Dennis Harstad, vice president of operations and general manager as well as a board member of South Dakota Trade.

“We have product testing partnerships, and we currently ship a small amount of product to Southeast Asia, but it represents a significant opportunity for our business,” Luecke said. “There is a significant need for better ingredients that are capable of delivering nutritional and environmental solutions to shrimp farmers and pet owners throughout Southeast Asia. We expect this trade mission will advance existing partnerships and develop new partnerships that will further open Southeast Asian markets for our products.”

Harstad found that many people he met with already had familiarized themselves with Houdek through the company’s website.

“We also had QR codes in our booth and on the business cards I passed out that received various hits showing continued interest in our product,” he said. “Reliable protein sources were a point of discussion. Fermented proteins were unique to them, and they seemed very interested in learning more about that process.”

Houdek was well received on the trade mission, Lindberg said.

“In fact, the ministries of agriculture in both countries specifically called out aquaculture as a growth opportunity for them domestically,” he said.

“They’re both island nations, and their populations have been longtime consumers of fish as a key staple in their diets, but they also know that sustainably raising fish is a more advantageous way of feeding the population. And the Houdek product line is incredibly efficient at raising fish effectively, so it was well received in both markets.”

Harstad anticipates “there will be a lot of follow-up with the contacts that were made,” he said. “It is a start to building a relationship. We will send the companies more information on our product and will soon schedule a meeting between them and one of our sales team. My goal would be to ship at least one of my contacts our products by the end of the calendar year.”

In all, six companies, three industry associations and leadership from SDSU were part of the trip. The university announced a new partnership during the trade mission with National Chung Hsing University in Taiwan, allowing for greater collaboration in research and higher education.

The full delegation included:

• Hunter Roberts, secretary, Department of Agriculture & Natural Resources.
• Jesse Fonkert, deputy commissioner, Governor’s Office of Economic Development.
• Joe Cassady, South Dakota Corn endowed dean, SDSU College of Agriculture, Food & Environmental Sciences.
• Joni Ekstrum, executive director, South Dakota Biotech.
• Jerry Schmitz, executive director, South Dakota Soybean.
• Doug Ode, board member, Midwest Dairy.
• Tim Houghton, vice president, H-S Precision.
• Gordon Ommen, founder and principal, BlackFork Farms.
• Joe Beck, executive director of corporate development, Viaflex.
• Dennis Harstad, vice president of operations, Houdek.
• Rob Hrabe, CEO, VRC Metal Systems.
• Gentry Boswell, vice president business development, VRC Metal Systems.
• Ron Rensberger, president, Rensberger Technologies.

Additionally, South Dakota defense-related companies found significant interest from countries during the trade mission, Lindberg said.

“Japan is doubling their defense spending,” he said. “And Taiwan, given the issues they’re facing with respect to an invasion from China, is significantly increasing their defense spending to create a deterrence factor. Our defense companies were very well received, so it was a strategic opportunity.”

South Dakota Trade already is exploring options for additional trade missions, potentially taking place as soon as late this year and next spring.

“We won’t really realize the full results of the delegation for months to come,” Lindberg said. “A lot of these contracts take weeks, months, quarters to develop. Each company had a full agenda of meetings, and they’re working to formalize contracts, so we anticipate we will learn of sales over the next several months that will show the return on investment for doing this delegation.”

South Dakota Trade regularly hosts events and is ready to help businesses begin or expand in exporting. Click here to learn more about the organization.