What's to nosh? A growing niche market for kosher foods, that's what.

Around the world, market opportunities for kosher food products are growing, and it appears this trend will continue. In the words of Menachem Lubinsky, President of Integrated Marketing & Communications, Inc., a firm that tracks kosher foods, "Opportunities for U.S. kosher food products

Why the new appeal? Reasons for the kosher sector's worldwide growth potential are similar to those in the United States, where kosher foods already have gone mainstream. Industry experts say:

* Jewish consumers are not the only ones who eat kosher foods, Muslims, Seventh-Day Adventists, vegetarians and people who are lactose-intolerant also find kosher foods acceptable.

* Foods with an ethnic identity are attractive to more and more people.While not yet at the same level of acceptance as pizza and salsa, kosher food products are a niche market with potential.

* Kosher food products aren't just knishes and gefilte fish anymore. They range from beef jerky to biscotti and from sun-dried tomatoes to surimi.

* Because they are certified, kosher foods are perceived to be healthier and more wholesome than other food products.

And the Survey Shows...

Last year, U.S. agricultural attaches in Austria, Belgium, Brazil, Canada, Chile, Costa Rica, France, Germany, Italy, Mexico, the Netherlands, New Zealand, South Africa, Spain, the United Kingdom and Venezuela responded to a Foreign Agricultural Service (FAS) survey seeking information about U.S. kosher food export opportunities. (See "Kosher Food Contacts Around the World" on the FAS home page at http://www.fas.usda.gov under News & Information, AgExporter magazine for more details.)

From Brazil to New Zealand, plenty of demand turned up for kosher food products. U.S. agricultural trade officer Robert Hoff, who was stationed at the U.S. Consulate in Sao Paulo, Brazil, noted, "Rib steaks, rib roasts and vacuum-packed meat are valuable kosher products that can't be found in Brazil - a potential market niche for U.S. exporters." In Wellington, New Zealand, U.S. agricultural attache Gary Meyer reported that,"Importers think that North American kosher products have great opportunity here."

Not only is there a demand for kosher foods in Austria, Brazil, Chile, New Zealand and Spain, but respondents indicated that these countries do not produce enough kosher foods domestically and must import. U.S. agricultural counselor Frank Lee, who was stationed at the U.S. embassy in Madrid, Spain, said, "Despite the rudimentary marketing system, some opportunities exist for U.S. exporters to sell kosher foods in Spain." Major suppliers, according to survey results, include Argentina, Canada, Germany, Israel, Italy, Norway, Poland, South Africa, the United Kingdom and the United States.

Although Belgium, Canada, Costa Rica, France, Mexico, the Netherlands and Venezuela themselves produce and export either the raw materials and ingredients used to manufacture kosher foods or the finished processed product, these countries still offer opportunities for U.S. kosher food exporters.

According to Norval Francis, who was the U.S. agricultural minister-counselor in Mexico City, Mexico, from February 1996 to July 1998, "The Mexican trade thinks kosher food products have good growth potential because hotels and restaurants purchase kosher products for quality reasons, while many in Mexico's Muslim community follow halal requirements, which are similar to kosher requirements."

As Dr. Avrom Pollak of Star-K Kosher Certification in Baltimore, Maryland, explained, "Halal slaughter and processing of meat and poultry products is equivalent to kosher slaughter and processing practices for meat and poultry. As a result, Muslim countries and Muslims at times will accept kosher certified meat, but without a kosher certification symbol."

Ethnic Appeal Boosts Kosher Consumption

Kosher foods are gaining ground in unexpected places around the globe as people discover the new and exciting tastes of ethnic foods.

"Kosher foods are of interest in Japan because they are part of an ethnic identity" said Dan Berman, director of the agricultural trade office in Osaka, Japan. "The image of the New York deli has good potential, which we hope to promote. For example, a specialized Japanese company, already regularly importing bagels by the 40-foot container load and selling them in department stores, is very interested in expanding its kosher product line."

Also, the Star-K Kosher Certification agency recently opened an office in western Australia to provide the Far East with kosher certification services for food chemicals.

In Italy, an increasingly international population has fueled a rise in kosher food sales. "Italian consumers have shown a growing interest in purchasing ethnic foods," noted former U.S. agricultural trade office director Holly Higgins, who was stationed at the American Consulate in Milan, Italy, from September 1992 to August 1997. "While still considered a niche market, kosher is part of the same expanding ethnic scene that's brought forth new ethnic restaurants and an increasing number of specialized shops in large cities."

Variety and Quality Are Kosher Keywords

Kosher items are growing in popularity, not only because people are more open to trying ethnic foods, but also because they are finally realizing that kosher foods aren't just matzoh or bagels and lox.

For example, the largest number of kosher food products sold in France are snacks, condiments, sauces and wines. Production of kosher ice cream has begun to supply demand for kosher sweets and desserts in Brazil. The fourth largest supermarket chain in Chile stocks Pringle's potato chips, M&M/Mars candies and Philadelphia Brand cream cheese, each with kosher certification.

Richard Blabey, the U.S. agricultural attache in Santiago, Chile, reported that the manager of the only Chilean delicatessen to import and sell kosher food products believes there is a potential niche for kosher frozen dinners and canned foods due to the growing trend toward ready-to-eat foods.

Then there's the perception of quality and wholesomeness. Richard Barnes, who was the U.S. agricultural minister-counselor in London, United Kingdom, from July 1994 to July 1998, noted, "Non-Jewish consumers are being drawn into eating kosher foods, which are frequently marketed as healthy, nutritious foods."

Besa Kotati, U.S. agricultural counselor in Pretoria, South Africa, made a similar point: "A lot of new buying power is coming from black consumers, who are interested in quality products, including kosher foods. The general public is not very informed about kosher products, but consumes them because of their high quality"

Kosher Foods Served in the Air, on Land

Around the world, consumers can find kosher food products in more and more places - supermarkets and delicatessens, airlines and trains and hotels and restaurants.

"Kosher food imports into France appear to be increasing, especially since Cash Casher Naouri - a specialized kosher supermarket - entered the market a few years ago" said Mattie R. Sharpless, U.S. agricultural minister-counselor in Paris, France. "This chain has 16 supermarkets throughout France, offering more than 1,600 different kosher products."

Both Belgium's Sabena Airlines and the Netherlands' KLM-Royal Dutch Airlines serve kosher snacks and meals on request and have been looking for U.S. kosher food suppliers. Italy's railway system recently began offering kosher and halal dishes on its high-speed regional trains that transit France, Austria, Switzerland and Germany. In Canada, a wide variety of combination bakery and restaurant or delicatessen and restaurant serves kosher food diners, while several major hotels offer separate kosher kitchens for banquets and meetings.

Tips for Marketing Kosher Food Products

Kosher food exporters, distributors and manufacturers interested in expanding sales to foreign markets face many challenges. Among them are differences in language, packaging, labeling, weights and measures and competitive pricing.

According to Menachem Lubinsky of Integrated Marketing & Communications, Inc., "U.S. exporters must first identify their markets and then find an importer to represent them in those markets."

As with other specialty products, supermarkets do not tend to import kosher foods directly because the volume is small. Instead, they rely on specialty importers and distributors that provide a full range of products and services. They can:

1. maintain regular contact with buyers,

2. work with the foreign government and handle the required paperwork, and

3. ensure that customer service is maintained and serve as the conduit through which supermarkets and restaurant chains purchase imported kosher food products.

Packaging is another important issue. In many countries, imported kosher food products cost as much as 30 percent more than non-kosher products. To compensate for the expense, consumers in these countries prefer individual, small-sized packages.

Many of the promotional techniques used by firms in the United States can be successfully adopted in other countries. U.S. companies may do well to make direct contact with local Jewish federations, congregations, religious associations, rabbinical councils and Jewish information centers to learn more about community trends and issues.

Point-of-purchase promotions in supermarkets and department stores are also recommended. Supermarket promotions could offer samples, introductory price discounts or premiums with a purchase. Consider supplementing in-store activities with advertising in trade and ethnic publications and newsletters or via the radio, television and Internet.

When marketing kosher food products overseas, don't forget the need for kosher certification. In many countries, local certifying agencies and rabbinical authorities are the only organizations that can certify the authenticity of kosher foods. Local rabbinical councils and Jewish information centers are a good source of guidance.

Different Countries, Different Rules

Processing, inspection and registration requirements vary by country. Brazilian regulations provide a good example of what U.S. kosher food exporters may encounter. These requirements are similar to those faced by non-kosher products.

* Wine, beer and distilled spirits must be imported by a Brazilian company registered with the Brazilian Ministry of Agriculture.

* All unprocessed products of plant origin (fresh fruits, nuts, bulk popcorn, dried fruits, etc.) must be accompanied by a U.S. Department of Agriculture (USDA) phytosanitary certificate.

* Beef products must be processed in plants that are under USDA's supervision.

* Dairy products must be processed in plants under the supervision of an agency of the U.S. government.

* Ice cream manufacturers must register with the Brazilian importer or distributor- the Brazilian Ministry of Agriculture is not in charge of ice cream product registration.

* Registration of kosher products may take a minimum of 25 days.

Labeling requirements also vary from country to country. For example, Canadian food and drug regulations prohibit the use of the word "kosher" on the label, package or in the advertising of a food product, but allow the symbols or labels approved by local rabbinical authorities. In Mexico, imported processed products must be labeled in Spanish, although another language may be used in addition. If the label is bilingual, the Spanish print must be the same size as the other language's print. In Brazil, labels should be in Portuguese with the name of the processor printed on it.

Linda Habenstreit is a public affairs specialist in FAS' Information Division. Tel.: (202) 7209442; Fax: (202) 720-3229; E-mail: habenstreit@fas.usda.gov