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Singapore food in favour overseas
Publication Date : 04-02-2013
Jars of Ya Kun kaya jam will soon line supermarket shelves in South Korea, while Chinatown Food Corporation's frozen prata is now available in North Korea.
They are just two examples of an increasing trend of local food companies diversifying into overseas markets.
Figures from International Enterprise (IE) Singapore, which promotes the overseas growth of local firms, show that the country's total food and beverage exports were worth $9.64 billion last year, up from S$7.84 billion (US$6.32 billion) in 2008.
The products are fast gaining popularity in Asean, India, Australia and South Korea. In contrast, the Republic's food and beverage exports to Britain and the United States have fallen by up to half since 2008 because of the economic slowdown there.
Popular items include condiments, pre-mixes, beverages, frozen products and three-in-one goods like instant coffee.
And while such products make up only a fraction of the S$510.3 billion worth of goods exported from Singapore last year, the rate at which the numbers are growing is encouraging, said the Singapore Manufacturing Federation.
The association, which has 130 members which export food products, links the growth to three reasons: more free trade agreements inked over the years, rising production costs elsewhere and the high quality of local goods.
The association's honorary chairman, Sunny Koh, said Singapore is starting to tap more consumers in countries like Myanmar, Vietnam and Cambodia.
Such markets were hard to penetrate in the past due to their low manufacturing costs and high import duties.
"But now, their cost of production is going up and the retail price gap is narrowing," he added. He noted that the bad press surrounding tainted, made-in-China products has also benefited Singapore goods.
Audrey Tan, IE Singapore's divisional director (food), lifestyle business group, said the rise of consumerism in regional markets such as China and Southeast Asia has also boosted demand for Singapore exports.
"There is also an increasing awareness of Asian flavours and concepts," she added.
IE Singapore holds food fairs abroad to help local firms hook up with potential partners. Last year, it held a one-week event in Shanghai and is looking to focus on the Middle East and China this year.
All this is good news for local companies. Thomas Pek, 52, managing director of Tai Hua Food Industries, said it started to export soya sauce to Walmart in Mexico and stores in Nigeria last year. Its products are now sold in more than 40 countries, up from 30 three years ago.
"We're pushing exports. Singapore is a small market," he said, adding that he often participates in overseas food exhibitions organised by IE Singapore. He said growth would have been faster if the Singapore currency had not been so strong in recent years.
A spokesman for Yeo's said it sees spiralling demand for its canned soft drinks in Vietnam, Myanmar and Cambodia.
"Singapore is becoming too competitive and saturated. There are so many items consumers can choose from, so many other brands and house-brands," she added, of the importance of branching out into other markets.
Other big boys, including Prima Taste, which exports sauce kits for dishes like laksa and chicken rice, and Tat Hui Foods, known for its Koka instant noodles, have also seen exports grow.
Adrin Loi, 58, who owns the Ya Kun kaya toast chain, is in the last stages of inking a deal with a supermarket chain in South Korea to supply 16,800 jars of kaya jam every three months.
"This will be the first overseas supermarket we are selling to. It will help grow our brand," he said.
Bengawan Solo's director of business development Henry Liew, 34, said it is in talks to export kueh lapis and cookies.
"The market here is quite small and we already have 42 outlets. I think any real growth will come from overseas exports," he said.