Lee’s presentation shared industry forecasts on the Asian food industry opportunity.

Singapore’s food and beverage (F&B) sector is transitioning its focus from productivity to value creation. Led by the Singapore Manufacturing Federation (SMF) and International Enterprise Singapore (IE Singapore), the industry is undergoing a transformation as manufacturers prioritize innovation, expansion, and globalization.

Lee says Singapore F&B manufacturers have much to offer
the world.

From April 12th to 15th, FoodAsia2016 will feature a variety of local companies with novel creations as part of the Singapore Pavilion spearheaded by SMF. FoodAsia, a specialized exhibition dedicated to food and beverages, is part of Food&HotelAsia (FHA), Asia’s leading and most comprehensive biennial trade event for the food and hospitality sector. A total of 114 companies will be present at the 1,857 sq m Singapore Pavilion, representing a 50% increase compared to the previous event, with an additional 24 companies exhibiting at other FHA events.

Asian F&B industry poised for strong growth

The F&B industry is flourishing in the Asia Pacific region as the global economy shifts eastward. According to Euromonitor International, the region’s F&B ingredients industry is projected to experience a compound annual growth rate (CAGR) of 4% from 2012 to 2017, representing 38% of the global utilization of value-added food and beverage ingredients by 2017. This potential has drawn numerous foreign investors to expand into Asia, leading to heightened competition among local and regional F&B players. To stay ahead, Singapore’s F&B industry is focusing on generating long-term value and implementing strategies that differentiate it from competitors.

“Despite a decline in global trade in 2015, Asia’s total trade with the rest of the world in packaged foods secured third place in 2015, trailing Europe and the Americas1. The Asia Pacific region is also predicted to have the second-highest growth rate for packaged foods over the next five years2. Consequently, even with a moderate economic outlook for 2016, opportunities exist within the region. Therefore, it is crucial for Singaporean companies to look beyond our domestic market, innovate, and adapt their business models to ensure future growth. With a robust ecosystem of food companies in place, Singapore’s food and beverage industry is well-positioned to capitalize on this growth trajectory,” states Lee Yee Fung, Group Director for Lifestyle Business at International Enterprise (IE) Singapore.

Prima is introducing wholegrain LaMian (noodles) in
laksa and curry flavours. One pack will fulfil an adult’s 
minimum recommended daily intake for whole grains. The 
steamed noodles are made with 51% Superfine Wholegrain 
flour, and come with Prima Taste paste. The halal-certified packs 
do not contain added MSG or preservatives, and have no 
artificial colouring or flavouring. Typical instant noodle packs 
offer fried noodles and powder-based seasoning.

Lee presented Euromonitor data on the packaged foods market, emphasizing that the Asia Pacific CAGR is projected to be 4.8% from 2015 to 2020, second only to the Middle East and Africa at 4.9% during the same period. Australasia ranks fourth with a 1.9% CAGR. Lee also highlighted the increasing sophistication of Asian consumers, with Asia predicted to account for 66% of the global middle-class population by 2030, according to Kharas and Gertz.

Rather than opting for the most affordable option, Asian consumers are demanding quality, convenience, and safety in their food choices. “These are emerging opportunities, and as food manufacturers, we should be considering how to capitalize on them,” he stated, citing Singapore’s robust infrastructure and tradition of food safety as advantages. Lee highlighted inherent strengths such as free trade agreements, an emphasis on food safety, and exceptional business infrastructure, including global connectivity and Singapore’s leading position as a financial hub.

Value creation and internationalization

New products and solutions to be showcased by Singaporean food manufacturers at FoodAsia2016 include ready-to-cook meals, premium chocolates, and canned fish otah.

One such innovation is the frozen “Hargow Crystal Skin” in a retail package, a world-first. Developed by Tee Yih Jia Food Manufacturing, the pastry used to make hargow (Chinese shrimp dumplings) is traditionally handcrafted. This results in potential quality inconsistencies and the need for fresh preparation to maintain pliability. This product can be thawed as needed and provides a consistently tender yet chewy skin after steaming. Tee Yih Jia anticipates that this product will substantially reduce food preparation times, benefiting home cooks, restaurant owners, and dim sum manufacturers.

Tee Yih Jia is introducing frozen hargow skins for more consistent hargow, every time. These are the first frozen hargow crystal skins in the world.

Source: Tan Seng Kee Foods (TSK). TSK is known for its Kang Kang (康康) fresh, preservative-free shelf-stable noodle range. The company is launching Express Meal Kits, which incorporate its noodles together with sauces for laksa, curry mee and the non-spicy prawn mee. All products are halal and have a shelf life of a month.

Tan Seng Kee Foods (TSK), renowned for its Kang Kang (康康) noodles, will be launching Express Meal Kits featuring its fresh, preservative-free noodles. These all-natural and preservative-free pasteurized fresh noodles have a shelf life of three to four weeks without refrigeration, six months when refrigerated, and 12 months when frozen. The company’s Express Meal Kits will include noodles paired with sauces for laksa, curry mee, and prawn mee. The three flavors were chosen for their popularity, with prawn mee offering a non-spicy alternative.

The Factory Chocolat is offering matcha flavoured luxury chocolate-covered fruit. The freeze-drying process preserves the antioxidant and vitamin content of the fruit.

The Factory Chocolat, a manufacturer specializing in a range of freeze-dried fruit chocolates, will be introducing its Gourmet range at FoodAsia2016. The company is among the local businesses that have successfully expanded and exported their products globally, reaching Mainland China, Hong Kong, Indonesia, Taiwan, Thailand, and Vietnam. The company will be launching matcha (green tea) flavored fruit chocolates in premium packaging. Each fruit is meticulously coated in a thin layer of dark chocolate, followed by white chocolate, and finally dusted with matcha powder from Japan, specifically selected to complement the chocolate and freeze-dried fruit.

“FoodAsia2016 provides an excellent platform for us to introduce our new product as it attracts a diverse audience from various parts of the world. This presents export opportunities for our product,” explains Ronald Ng, General Manager of The Factory Chocolat.

SMF has implemented several initiatives aimed at assisting local F&B manufacturers in value creation and internationalization, including the Working-in-Partnership (WIP) Programme. WIP enables local food exporters to collaborate and ship their products directly to overseas supermarkets. This eliminates intermediaries, reducing operational costs for food companies while leveraging the strength of collective branding.

“Innovative practices and technologies, along with strategic alliances, are essential for the Singaporean F&B industry to create value, maintain competitiveness in both global and local markets, and contribute to a diverse global food industry. The Singapore Pavilion at FoodAsia2016 provides exhibitors with opportunities to establish networks and distribution channels. SMF facilitates the internationalization process for our exhibitors through the Hosted Buyers Programme, which brings buyers from around the world to meet directly with exhibitors. We are observing positive outcomes from food companies’ efforts to expand overseas, particularly as the Made in Singapore brand gains increasing recognition for food safety and high quality,” says Sunny Koh, SMF Deputy President and Chairman of the SMF Food & Beverages Industry Group.

Koh speaks at a media preview of Food&HotelAsia.

Koh emphasized the need for transformation in both retailers and manufacturers and a streamlined value chain. “Retailers are grappling with operational costs, low margins, and intense competition from e-commerce channels,” Koh stated. “For exporters, the days of passively waiting for orders are over.”

Internationalization is crucial, according to Koh, who noted that food manufacturers can seek assistance from fellow SMEs, government support, and trade associations and chambers.

He explained that the Working-in-Partnership (WIP) Programme allows manufacturers to share shipping costs by consolidating their food products into a single container, which is then transported to the port closest to the customer. This initiative helps SMEs accelerate and simplify their internationalization efforts while eliminating logistics intermediaries to reduce the price discrepancy between online and physical stores.

“Singaporean products in China are currently sold at two to three times the retail price in Singapore. WIP consolidation can help lower retail prices,” he added. For instance, soy sauce might cost S$5.30 per bottle locally but RMB78 (S$16.28) in China. “Through WIP, we can potentially reduce this to RMB32.15 (S$6.71), enabling better market penetration and increased efficiency,” he said.

Koh also mentioned plans to expand the WIP program, which is already operational with companies in Thailand and Myanmar. “By going direct, some Singaporean products in Thailand can be sold at prices comparable to those from local manufacturers,” he explained.

This year, FHA anticipates over 65,000 trade attendees from more than 90 countries and regions. In partnership with IE Singapore, SMF will be hosting over 130 buyers from over 60 companies across 18 countries and regions for scheduled business matching sessions with Singaporean exhibitors.

“We are encouraged by the increased booth space occupied by local exhibitors this year. This demonstrates their confidence in FoodAsia as a platform where the convergence of buyers and exhibitors from around the world creates a thriving marketplace for the Singaporean food sector to foster partnerships and expand their networks with relevant buyers,” stated Ting Siew Mui, Project Director of Lifestyle Events at Singapore Exhibition Services, the organizer of FHA.

_FHA _will feature numerous firsts in 2016, including a notable increase in new exhibitors from Singapore, such as Boon Tong Kee, Fraser & Neave, Lam Soon, Owl International, Super Group, and Yeo Hiap Seng. Singaporean exhibitors are present both within and outside the Singapore pavilion. Individual exhibitors include Aalst Chocolate, Cocoaorient, Delifrance Singapore, Euraco Finefood, and Foodxervices.

Interested?

FHA2016 will take place from April 12th to 15th, 2016, at Singapore Expo (Halls 1 to 9 Annex) from
10 am – 6 pm (April 12th – 14th, 2016) and 10 am – 4 pm (April 15th, 2016).
The event is exclusively open to business and trade professionals.

For more insights, read the WorkSmart Asia blog post on the latest developments at FHA.

1 According to the International Trade Centre, the total trade in packaged foods between each region and the rest of the world is as follows: Europe (US$416 billion), Americas (US$295 billion), Asia (US$197 billion), Middle East and Africa (US$88 billion), and Oceania (US$40 billion).
2 According to Euromonitor, the Asia Pacific packaged food market is forecast to expand at a five-year CAGR of 4.8% until 2020, representing the highest projected growth rate after the combined Middle East and Africa region.