Economic value

Fermented foods were the original members of the value-added category. Milk is milk, but add some culture and manipulate the mixture just right, age it for a time, and the result may be a fine cheese that fetches a price well above the combined costs of the raw materials, labor, and other expenses. Grapes are grapes, but if grown, harvested, and crushed in a particular environment and at under precise conditions, and the juice is allowed to ferment and mature in an optimized manner, some professor may well pay up to $6 or $7 (or more!) for a bottle of the finished product. Truly, the economic value of fermented foods, especially fermented grapes, can reach extraordinary heights (apart from the professor market). As noted in Chapter 10, some wines have been sold for more than $20,000 per bottle. Even some specialty vinegars (Chapter 11) sell for more than $1,000 per liter. It should be noted that not all fermented foods command such a high dollar value. In truth, the fermented foods market is just as competitive and manufacturers are under the same market pressures as other segments of the food industry. Fermented foods are generally made from inexpensive commodities (e.g., wheat, milk, meat, etc.) and most products have very modest profit margins (some products, such as "current" or un-

aged cheese, are sold on commodity markets, with very tight margins).There is a well-known joke about the wine business that applies to other products as well, and that summarizes the challenge in making fermented foods:"How do you make a million dollars in the wine business? Easy, first you start with two million dollars." Finally, on a industry-wide basis, fermented foods may have a significant economic impact on a region, state or country. In California, for example, the wine industry was reported to contribute more than $40 billion to the economy in 2004 (according to a Wine Institute report; www. wineinstitute.org).A similar analysis of the U.S. beer industry (www.beerinstitute.org) reported an overall annual impact of more than $140 billion to the U.S. economy.

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Responses

  • Susanna
    What is the dollar value of fermented products?
    6 years ago

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