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Industry Report - Food & Beverage - March 2014

Adding Value to Information Since 1900

Asia-Pacific

Food & Beverage Sectors


A Company and Industry Analysis
CONTENTS
Current Environment
Sector Overview
Sector Performance
Leading Companies
Mergers and Acquisitions
Initial Public Offerings
Industry Profile
Industry Size and Value
Sector Investment
Policy and Regulatory
Environment
Market Trends and Outlook
Demand for Convenience and
Healthy Products Continues to
Grow
Consumer Friendly Food
Packaging
Food Safety Concerns Grow
Market Outlook
Country Profiles
Australia
China
India
Japan
Thailand
The Philippines
Currency Conversion Table
The Scope of This Report
Key References
Comparative Data
Reports Coverage

March 2014

Current Environment Key Points


Asian economies remained soft over the past six months. The Philippines imported more rice after
Super Typhoon Haiyan destroyed crops in November 2013, while Indias Food Safety destroyed
crops and Standards Authority (FSSAI) blocked processed food shipments as they did not comply
with labeling requirements.
Most leading companies in the sector experienced moderate growth in sales and profitability in the
latter half of 2013, fueled by higher overseas demand.
Leading F&B companies faced less-impressive share performance. The average stock price of
the leading food and beverage companies in the Asia-Pacific by revenues as tracked by Mergent
increased by 7.24% over the six months period from August 8, 2013 to January 8, 2014.
Merger and acquisition activity remained active throughout the six months, as companies sought
economies of scale, aiming to maximize operating efficiencies and enhance market visibility.
Initial Public Offerings (IPO) activity surged in the latter half of 2013 and was expected to remain
active over the next six months.
Industry Profile Key Points
The F&B industry is one of the largest contributors to GDP in most Asia-Pacific countries, with
China, India, Japan and the Philippines having the biggest F&B industries in the region.
F&B companies in the Asia-Pacific continue to seek opportunities in both foreign and domestic
markets to achieve sales growth and profitability, investing in research and development and
upgrading technologies.
New laws and regulations introduced in different countries in the latter half of 2013 as food safety
becomes a more important issue in the region. The Governments are trying to improve food safety
and strengthen consumer confidence. Several new laws and regulations were introduced to protect
and encourage industry growth.
Market Trends and Outlook Key Points
Population growth, urbanization, and rising incomes are modernizing Asia-Pacific lifestyles and
changing the diets of many people, driving demand for prepared and convenience food products.
Japanese has increased their expenditure on coffee and cocoa beverages.
Consumer friendly packaging is more appealing to consumers who have busy lifestyles and also to
younger generations, such as Generation Y and Generation Z.
Food safety concerns continue in both Japan and China as new scandals have emerged over the past
six months, affecting the reputation of the industries.
A shift in consumption patterns will influence companies sales and profit margins. Chinese
consumers are willing to pay more for better quality products, while Australian have become more
accepting of new wines.
The health-conscious market will continue to demand more nutritious, safer and organic products,
and this will remain a key trend in the Asian F&B industry over the next few years.

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Industry Report - Food & Beverage - March 2014

Publisher
Jonathan Worrall
Director
John Pedernales
Managing Editor
Peter OShea
Research Analyst
Huong Yuli
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email: customerservice@mergent.com
Sales Enquiries:
Tim Worrall - Asia-Pacific Sales Manager
+61 422 721 844
email: tim.worrall@mergent.com

Copyright Statement

The Asia-Pacific Industry Reports are

Copyright 2014 by Mergent, Inc. All Information contained herein is


copyrighted in the name of Mergent, Inc. and none of such information may be
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published by Mergent, Inc., headquartered in


Fort Mill, South Carolina, USA. Each
industry sector report is updated every six

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months. Mergent, Inc., a leading provider of


Disclaimer

global business and financial information on


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Industry Report - Food & Beverage - March 2014

Current Environment
Sector Overview
The Asian economy remained soft in the latter half of
2013, due to instability in financial markets because of the
slow recovery of the US economy and volatile commodity
prices, despite Japans economic recovery. Even the
emerging economies of India and China continued to
show only moderate growth. Despite volatile food and raw
material prices, and financial market uncertainty, the AsiaPacific food and beverage (F&B) market showed moderate
growth over the past six months, thanks to fast growing
emerging markets.
Growth was influenced by demand for healthier foods
due to increased food safety concerns, growing middle
classes, promotional campaigns and liberal regulatory
environments. Many leading companies such as Kirin
Holdings Co Ltd (TSE: 2503), Nippon Meat Packers Inc
(TSE: 2282), Nisshin Seifun Group Inc (TSE: 2002) and
Asahi Group Holdings Ltd (TSE: 2502) improved earnings
and sales. The industry remains attractive to foreign
investors seeking to expand their businesses.
Rapidly growing income levels and rising standards of
living in emerging countries, particularly China and India,
are leading to greater expenditure on food. Consumers,
particularly the younger generation, are willing to spend
more on luxury foods and try new varieties. Other
demographic changes, including a rising number of

women in the workforce and more hectic lifestyles, fueled


the demand for convenience, healthy and high value-added
foods.
As governments reformed local industries, imported F&B
products were affected. China tried to reform its dairy
industry, while the Philippines tried to supply its own dairy
and rice demands. However, the Philippines will increase
rice imports in the first half of 2014 as rice crops were
destroyed by Super Typhoon Haiyan in November 2013.
Chinas demand for F&B products is expected to grow as
the Government relaxed its one-child policy.
Indias Food Safety and Standards Authority (FSSAI)
blocked processed food shipments from Thailand, the
UK, the US and France on November 2, 2013, as they
did not comply with the latest labeling requirements.
The Food Safety and Standards Act of 2006, enforced in
2011, required importers to state all content information
on product packs before they are exported to India. This
hit food importers, and severely damaged Indias trade
reputation, as there was no grace period given.
Sector Performance
The shares performance of leading Japanese F&B
companies was less impressive over the six months from

Table 1: Leading Company Share Price Movements over the Six Months from August 8, 2013 to January 8, 2014

Company Name
Kirin Holdings Co Ltd
Asahi Group Holdings Ltd
Nippon Meat Packers Inc
Yamazaki Baking Co Ltd
Kewpie Corp
Itoham Foods
Nisshin Seifun Group Inc
Nissin Food Holdings Co Ltd
Industry Average Rise/Fall
Dow Jones Asia-Pacific F&B Index (DJAPFB)
S&P 500

Closing Price as on
August 8, 2013
1,461 (US$14.04)
2,512 (US$24.14)
1,447 (US$13.9)
1,186 (US$11.4)
1,503 (US$14.44)
423 (US$4.06)
1,039 (US$9.98)
4,000 (US$38.44)

Closing Price as on
January 8, 2014
1,469 (US$14.12)
2,918 (US$28.04)
1,862 (US$17.89)
1,062 (US$10.2)
1,447 (US$13.9)
472 (US$4.54)
1,082 (US$10.4)
4,440 (US$42.66)

173.17
1,697.48

173.36
1,837.49

% Change
0.55
16.16
28.68
10.46
3.73
11.58
4.14
11.00
7.24
0.11
8.25

Sources: Tokyo Stock Exchange, Dow Jones and S&P Indices

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Industry Report - Food & Beverage - March 2014

Current Environment
August 8, 2013, to January 8, 2014, rising by an average of
7.24%, than in the six months from February 1 to July 31,
2013, rising by an average of 14.62%. Share prices of AsiaPacific companies were stronger, except those of Yamazaki
Baking Co Ltd (TSE: 2212) and Kewpie Corp (TSE:
2809). The Dow Jones Asia-Pacific Food & Beverage
Index gained 0.11%, compared with the S&P 500s 8.25%
gain. The share prices of eight leading companies tracked
by Mergent rose by an average 7.24%, with expectations
for better returns in the next six months.
Nippon Meat Packers Inc was the major gainer, its share
price closing at 1,862 (US$17.89) on January 8, up
from 1,447 (US$13.9) on August 8, 2013. Asahi Group
Holdings Ltds share price rose by 16.16% to 2,918
(US$28.04), from 2,512 (US$24.14), while Itoham
Foods (TSE: 2284) rose by 11.58% to 472 (US$4.54),
from 423 (US$4.06).
Nissin Food Holdings Co Ltds (TSE: 2897) share price rose
by 11% to 4,440 (US$42.66), from 4,000 (US$38.44),
Nisshin Seifun Group Incs by 4.14% to 1,082 (US$10.4),
from 1,039 (US$9.98), while Kirin Holdings Co Ltds rose
by 0.55% to 1,469 (US$14.12), from 1,461 (US$14.04).
The worst performer was Yamazaki Baking Co Ltd, whose
share price dropped by 10.46% to 1,062 (US$10.2), from
1,186 (US$11.4), while Kewpie Corps dropped by 3.73%
to 1,447 (US$13.9), from 1,503 (US$14.44).
Leading Companies
Japanese companies continued to dominate the AsiaPacific F&B industry over the first nine months of 2013,
with most companies showing signs of recovery, thanks to
higher overseas demand. Leading brewer Kirin Holdings
Co Ltds (TSE:2503) net profit totaled 83.66 billion
(US$803.89 million), up threefold from 25.37 billion
(US$243.78 million) a year earlier. Sales grew by 4.45%
to 1,677.61 billion (US$16.12 billion), from 1,606.14
billion (US$15.43 billion) a year earlier, due to higher
demand for overseas integrated beverages. Operating
income rose 2.14% to 107.5 billion (US$1.03 billion),
from 105.25 billion (US$1.01 billion).
Kirins archrival Asahi Group Holdings Ltds (TSE:
2502) net sales increased by 10.34% to 1,257.03 billion
(US$12.08 billion), from 1,139.19 billion (US$10.95
billion) in the first nine months of 2013, with operating
income rising by 23.77% to 83.77 billion (US$804.95
million), from 67.68 billion (US$650.34 million), despite
higher sales costs and rising operating expenses. Net

income increased by 2.5% to 46.73 billion (US$449.03


million), from 45.59 billion (US$438.07 million). Asahi
reported higher sales in overseas segments.
One of Japans top processed meat producers Nippon
Meat Packers Incs (TSE: 2282) net sales rose by
9.76% to 811.84 billion (US$7.8 billion) in the fiscal
first half ending March 31, 2014, from 739.63 billion
(US$7.11 billion) a year earlier. Net income jumped
86.23% to 10.82 billion (US$103.97 million), from 5.81
billion (US$55.83 million), thanks to higher overseas
processed food and dairy sales, and increased operating
efficiency.
Steady demand raised mayonnaise-maker Kewpie Corps
(TSE: 2809) net sales by 4.47% to 395.13 billion
(US$3.8 billion) in the nine months ended August 31,
2013, from 377.94 billion (US$3.63 billion) a year
earlier. Nevertheless, its net income dropped by 7.3% to
10.28 billion (US$98.78 million), from 11.09 billion
(US$106.56 million), due to higher raw material costs and
operation expenses.
Itoham Foods (TSE: 2284) net sales increased by 3.78%
to 221.02 billion (US$2.12 billion) in the six months
ended September 30, 2013, from 212.96 billion (US$2.05
billion) a year earlier, due to the weaker yen. Business
reforms pushed operating expenses down, and increased
net income to 1.49 billion (US$14.32 million), from 515
million (US$4.95 million) in 2012.
Nisshin Seifun Group Inc (TSE: 2002) is a holding
company engaged in the flour milling, food processing, pet
food, pharmaceuticals, engineering and feed businesses,
with 50 subsidiaries and 16 affiliates. In the six months
ended September 30, 2013, its net sales rose by 7.9% to
239.32 billion (US$2.3 billion), from 221.78 billion
(US$2.13 billion) a year earlier, while net income rose by
4.25% to 7.12 billion (US$68.42 million), from 6.83
billion (US$65.63 million), thanks to lower operating
expenses.
Nissin Food Holdings Co Ltd (TSE: 2897) manufactures
instant noodles, frozen foods, confectionery and dairy
products. Its net sales rose by 8.33% to 193.26 billion
(US$1.86 billion) in the six months ended September 30,
2013, from 178.4 billion (US$1.71 billion) a year earlier,
thanks to higher overall demand. Net income expanded
by 37.74% to 8.54 billion (US$82.06 million), from
6.2 billion (US$59.58 million) a year earlier, thanks to
production efficiency.

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Industry Report - Food & Beverage - March 2014

Current Environment
Mergers and Acquisitions
The latter half of 2013 was an interesting one for AsiaPacific mergers and acquisitions (M&A), particularly in
China. Some overseas companies looked for routes into
bigger local markets, with Carlsberg A/S (CSE: CARL. B)
increasing its stake in Chongqing Brewery Co Ltd (SSE:
600132) to 60%, from 29.7%, on December 5, 2013, paying
RMB2.9 billion (US$478.09 million). On December 30,
2013, Carlsberg acquired the whole Chongqing Brewery
for RMB1.56 billion (US$257.18 million), in an attempt
to strengthen its leading position in Chinas growing beer
market. The deal is waiting for approval from the Chinese
Government.
Some dairy companies in China continued to source raw
materials abroad, trying to increase customer confidence in
local products. SFL Holdings Ltd, a subsidiary of Chinese
private food conglomerate Pengxin Group Co Ltd, offered
NZ$85.7 million (US$70.67 million) for New Zealandbased dairy farm Synlait Farms. The deal, being examined
by the Government, is expected to be completed by
February 28, 2014. The acquisition will leverage Pengxin
Groups capabilities and resources in R&D, product quality
control, marketing, and greater capital access to help it
capture the emerging infant milk formula market in China.
China Mengniu Dairy Co Ltd (HKSE: 2319) acquired
infant formula producer Yashili International Holdings Ltd
(HKSE: 1230) on January 5, 2014 for RMB376.66 million
(US$62.1 million), in an attempt to improve its market
share in the emerging milk powder market and to restore
consumer confidence, affected by the melamine-tainted
milk furor in 2008.
Canada-based dairy producer Saputo Inc (TSE: SAP)
acquired Warrnambool Cheese and Butter Factory
Co (WCB), one of the Australias oldest private dairy
manufacturers, from investment company Wilson Asset
Management Ltd for more than A$515 million (US$452.17
million) on January 21, 2014. The acquisition allowed
Saputo to control WCBs cheese factory, which produces
Lion products of Kirin Holdings Co Ltd, in Allansford,
Victoria state. The deal will also leverage Saputos
capabilities and resources, and greater capital access to
help it capture the growing global dairy market.

(US$583.6 million). The acquisition will leverage


Hersheys distribution capabilities and strengthen its
presence in Chinas growing confectionery market.
Groupe Lactalis SA, Frances private leading dairy producer,
bought Indias second largest private dairy company
Tirumala Milk Products Pvt Ltd for an undisclosed amount
on January 8, 2014. The acquisition will help Lactalis to
enter one of the worlds largest dairy markets.
Initial Public Offerings
One of Chinas leading F&B producers Tenwow
International Holdings Ltd made its debut on the Hong Kong
Stock Exchange on September 17, 2013, raising HK$1.58
billion (US$203.72 million), and was oversubscribed more
than 55 times. The initial offer price of HK$3.15 (US$0.41)
made shares attractive, and, thanks to good publicity and
strong investor confidence on the earnings outlook, the
share price rose by 17.14% to HK$3.69 (US$0.48) on
the first day of trading. The listing could provide funds to
expand both production capacity and distribution network.
Milk manufacturer China Huishan Dairy Holdings Co Ltd
debuted on the Hong Kong Stock Exchange on September
27, 2013, raising HK$10.12 billion (US$1.3 billion). The
initial offer price of HK$2.67 (US$0.34) was at the top-end
of the pricing range, making the shares less attractive, and
the price dropped by 3.75% to HK$2.57 (US$0.33) on the
first day of trading. The funds will be used to build new
farms and a milk powder plant.
YuanShengTai Dairy Farm, Chinas fourth largest
raw milk producer, debuted on the Hong Kong Stock
Exchange on November 26, 2013, raising HK$3.29 billion
(US$424.2 million). The share price dropped by 3.7% to
HK$2.6 (US$0.34) from the initial offer price of HK$2.7
(US$0.35), due to low investor confidence on the earnings
outlook. The company plans to inject the funds into new
farms, including corn farms.

Hershey Netherlands BV, a subsidiary of The Hershey Co


(NYSE: HSY), bought China-based private confectionery
and snack producer Shanghai Golden Monkey Food
Co (SGM) on December 19, 2013, for RMB3.54 billion

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Industry Report - Food & Beverage - March 2014

Industry Profile
Industry Size and Value
Due to limited opportunities for growth in North America
and Western European markets, international companies
continue to expand and invest in the Asia-Pacific, which is
highly diverse in culture, language, consumption patterns,
population, economic freedom and laws. The F&B industry
is one of the largest contributors to gross domestic product
(GDP) in many Asia-Pacific countries, with each having
distinctive strengths in different segments. China, India,
and Thailand have become rice bowls of the region, thanks
to their high production volumes and the quality of their
rice, which many Asians prefer to homegrown varieties.
Australia arguably has the most developed market,
particularly in processed meat, wine and dairy products.
Its F&B industry has an annual turnover of A$111 billion
(US$97.46 billion). High productivity, coupled with
consistently safe and high quality food has contributed
to industry growth. Free trade agreements with the US,
Malaysia, Singapore and Thailand have ensured greater
access for Australian F&B products and this has boosted
exports. Its main F&B exports include cereal products,
processed meat, beverages and dairy products.
In addition, the Governments National Food Plan,
launched on May 25, 2013, to help the industry capitalize
on growing food demand in Asia, will create new export
opportunities through strengthening trade relations with
Asian countries. The Australian industry had 225,100
employees in 2012/2013, mainly in the processed meat,
beverages, and bakery product segments, Australian
Bureau of Statistics (ABS) data shows.
China is one of the worlds largest food consumers, with its
processed food market growing consistently. Since joining
the World Trade Organization (WTO) in 2001, the Chinese
Government has opened the gates wider to its enormous
market, resulting in steady growth in exports and imports.
Despite rapid economic growth, Chinas food processing
market is still under-developed, with only 30% of Chinese
food production processed, and many foreign companies
are taking advantage of the greater demand for high quality
processed food products.
Several large corporations have bought smaller
competitors to increase their market share and leverage
their capabilities and resources. The number of formula

milk powder producers decreased by 31.5% to 87 in 2013,


from 127 in 2012, according to the Ministry of Industry
and Information Technology (MIIT).
India is a growing market for processed food imports,
which are becoming more popular with the younger
population, especially in urban areas. It is the worlds
second largest food producer, after China. Its abundant
agricultural land, cheap labor and friendly regulatory
environment have attracted multinationals to exploit the
vast opportunities for value-added, packaging and exports
in the food processing segment. Growing affluence, rising
incomes and changing middle-class lifestyles favor the
industry, particularly the processed and ready-to-eat
segments. However, an inefficient infrastructure and
supply chain, and the seasonality of raw materials are
obstacles to industry growth.
Japan remains a net importer of food due to rising costs of
labor and raw materials. A lack of land and higher operating
costs have resulted in a decline in self-sufficiency farming
in Japan, making it the regions largest net food importer.
In the aftermath of an earthquake-triggered tsunami and
nuclear plant meltdown in early 2011, food fears persist
as radioactive water leaks are continuously being found
at the stricken nuclear plant, and this could lead to higher
demand for imported food. Many countries have extended
their bans on Japanese products, affecting processed food
businesses and economic growth. Recent participation in
the Trans-Pacific Partnership (TPP) free trade agreement
could further accelerate the import of agricultural products
and negatively affect the local farm industry.
In Thailand, F&B is the main manufacturing sector and,
despite frequent political instability, Thailand has made
its mark on the global food industry. It appeals as a
tourist destination and the high growth rate of its hotels
and restaurants is continuing to support the industry by
boosting demand for F&B products. As Thailand is blessed
with abundant raw materials, the food processing industry
is expected to maintain its growth.
The Philippines processed food sector is one of the
largest industries in the country, with an abundant supply
of fruit and vegetables. The Philippines is also the largest
US export market in South East Asia and its 12th largest

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Industry Report - Food & Beverage - March 2014

Industry Profile
globally, mainly for egg and dairy products, according
to the US Department of Agriculture (USDA). However,
government efforts in building dairy self-sufficiency could
reduce both imports and exports. Beer drinking has long
been part of the social and cultural life of Filipinos and the
Philippines is the third largest beer market in South East
Asia.
Asia-Pacific provides a wealth of opportunity for the F&B
industry and is poised to be one of the hottest regions for
food manufacturing in the next few years. Rising purchasing
power and demand for convenience and premium F&B
products will help stimulate the development of food
retailing and distribution in the region.
Sector Investment
Investment activity in the industry picked up throughout
2013, with some international companies increasing
production capacities and expanding production lines
to strengthen their positions in Asia-Pacific, due to its
emerging middle class and growing spending power. In
Thailand, US-based private agribusiness giant Cargill Inc
invested US$10 million to upgrade its poultry processing
facilities in Saraburi Province, expecting completion by
July 2014.
Austria-based private energy drink producer Red Bull
GmbH has obtained approval to sell its core products in
China and is setting up a small office in Shanghai. Red Bull
will conduct a market acceptance test before launching its
products in China to ensure market demand and increase
brand awareness.
The stability of Indias processed food and beverage market
has attracted multinational companies. Following CocaCola Cos (NYSE: KO) US$5 billion 2012-2020 Indian
investment plan, and as part of its plan to invest Rs330
billion (US$5.36 billion) create 8,000 jobs by 2020, Pepsi
Co (NYSE: PEP) will set up Rs12 billion (US$195 million)
beverage plant in Chittoor district, Andhra Pradesh state.
The project will be completed in three phases, the first
phase creating a daily capacity of 1.2 million liters. The
expansion will help to meet growing beverage demand
and to strengthen Pepsis position as the leading beverage
producer in South Asia.
On December 17, 2013, Coca-Cola Amatil (ASX: CCL)
re-entered the Australian beer market and introduced new
international and local brands, including its own Alehouse
brand. The company is optimistic about the beer market,

despite many Australians shifting their preferences to wine.


Private Australian F&B producer Lion Pty Ltd opened a
A$60 million (US$52.68 million) brewery at Geelong in
Victoria, producing 1.2 million cartons of beer and creating
50 jobs. The expansion will help Lion to capitalize on a
growing crafted beer market in Australia.
Policy and Regulatory Environment
The latter half of 2013 saw several changes to AsiaPacifics regulatory landscape, which will play significant
roles in shaping the F&B industry. The Philippines
Government enacted its first food safety law on August 28,
2013, a decision welcomed by the industry. In an attempt to
strengthen its food safety regulation system and to protect
consumers from food-borne and water-borne illness, the
new regulations will have effects on both foreign and
domestic F&B companies, which need to comply with
internationally recognized standards, such as the Codex
Alimentarius Commission, ISO9000 and ISO14000.
Punishments for causing food-borne deaths include a
maximum six-year prison sentence.
The Indian Government extended its ban on imported
genetically modified (GM) processed food until March 31,
2014, claiming that such foods would affect consumers
health and biodiversity. However, limited imports are
allowed for analysis or research purposes with permission
from the ministrys apex regulatory body the Genetic
Engineering Approval Committee (GEAC).
After the unsolved radiation leakage problem at the
Fukushima nuclear plant was exposed to the public in 2013,
many countries have extended their bans on Japanese food
products, particularly marine products. The US Food and
Drugs Administration (FDA) expanded product bans from
eight to 14 prefectures on September 9, 2013, while South
Korea increased bans to 50 Japanese marine products on
September 6, 2013, due to increased public health concerns
over radiation and nuclear contamination issues. These
export limitations have negatively affected economic
growth.
With the F&B regulatory environment changing,
particularly in relation to food safety and labeling,
companies need to revise their policies and standards more
often to keep pace. The latest free trade agreement with
South Korea on December 5, 2013, will boost Australias
economy by A$653 million (US$573.33 million) annually
after 2030. Under the A$5 billion (US$4.39 billion)
agreement, Australia enjoys tariff elimination on products,

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Industry Report - Food & Beverage - March 2014

Industry Profile
including beef, wine, fruit, and sugar, for the next 15 years
from 2015. The agreement will benefit Australian F&B
producers as their products become more competitive
compared with other countries.

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Industry Report - Food & Beverage - March 2014

Market Trends & Outlook


Demand for Convenience and Healthy Products
Continues to Grow
Population growth, urbanization, and rising incomes
are modernizing Asia-Pacific lifestyles and changing
the diets of many people, driving demand for prepared
and convenience food products. Middle classes and
younger generations, such as Generation Y and
Generation Z, are more accepting of different products
such as western foods. Demand for iced coffee drinks
in Asia is expected to rise, particularly in Japan, due to
growing middle classes and rising incomes. The average
monthly expenditure on coffee and cocoa beverages per
Japanese household grew by 1.96% to 728 (US$7) in 2013,
from 714 (US$6.86) in 2012. As Chinas Government
has relaxed its one-child policy, the countrys demand for
F&B should increase at faster pace, particularly for diary
products.
More consumers are seeking time-saving meal solutions
that do not compromise on quality or taste. Foods that
attract consumers come in both prepared and semi-prepared
forms that can be re-heated at home or in the workplace
in just a few minutes. With the increasing number of twobreadwinner households and single-person households in
many Asian countries, consumption of a variety of chilled
and frozen, home-meal replacements, ready-to-cook,
ready-to-eat and ready-to-drink products, and products that
come in smaller portions are rising.
Japans snack market, which was worth 1,106 billion
(US$10.63) in 2013, is expecting to grow with product
innovation. Although the market is well developed, with
more people are focusing on diet and wellness, particularly
the young females, future focus should put on less-oil, lesscalories products. Products with healthy image that come
in smaller portions could be more appealing to healthconscious consumers.
Due to increasing health consciousness and rising
standards of living, consumers are also opting for products
that deliver a range of benefits such as added-fiber products
that promote digestive health, and they are willing to pay
a premium for quality and healthy products such as tea,
bottled mineral water and lemon-lime flavored drinks.
Green tea consumption has increased over the past few
years in China and Japan as many believe that it helps with
weight and health management. Many soft drink companies

are exploiting these opportunities by introducing flavored


tea, iced tea and tea with herbs and fruit. With health and
convenience trends continuing to gain pace, and with
manufacturers turning to added-value ingredients, the
market for ready-to-drink beverages should see further
growth in the next few years.
Consumer Friendly Food Packaging
Packaging is one of the factors influencing consumers
purchasing decisions, and F&B companies consider it a
critical component of their branding, merchandising and
promotional strategy. Many options have been offered to
consumers, from metal cans, tubs, aseptic packaging, and
bowls to pouches. In the battle for market share and retail
shelf space, packaging is a powerful weapon. It plays an
important part in product innovation, as products with
convenience packaging are more appealing to consumers
who are increasingly looking for F&B they can consume
while on the move to suit their busy lifestyles.
Canned soup demand is declining in Australia due to its
hard-to-open packaging, with the younger generation
preferring soup in stand-up pouches, regarding canned
food as old-fashioned. Many leading F&B companies are
re-structuring their product ranges and developing new
categories, products and packaging designs.
Some food manufacturers and packagers are also placing
greater emphasis on providing quality seals and labels
that indicate if the product has been tampered with before
purchase. Given the number of high profile food safety
scandals in recent years, food manufacturers are becoming
more aware of maintaining higher standards of hygiene and
freshness throughout stages of food processing to protect
the integrity of the product.
Food Safety Concerns Grow
With growing awareness of health and nutrition, consumers
are more sophisticated and looking for new, improved
products that will add value to their lives and offer the
highest nutrition value, quality and reliability. Food
scandals will lose consumer confidence and brand loyalty,
which takes food producers a long time to regain.

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Industry Report - Food & Beverage - March 2014

Market Trends & Outlook


Japan faced export limitations after the 2011 earthquake,
tsunami and nuclear disaster. Food fears persist as
radioactive water leaks are continuously being found
at the stricken nuclear plant, leading many countries
to extend their bans on Japanese products, particularly
marine products. The radiation leakage at the Fukushima
nuclear plant will continue to affect Japans exports and its
reputation for safe, high-quality produce while it remains
unsolved.
Recent false labeling on local and imported food products
and products recalled by a frozen food supplier have also
shaken Japans reputation for safe, high-quality produce.
Food producer Maruha Nichiro Holdings (TSE: 1334)
recalled 6.4 million products on January 2, 2014, after
pesticide was found in its products. With hundreds of
people reporting illness, the companys reputation was
badly affected. The full ramifications of the pesticide
incident are still being assessed.
China is no stranger to food safety scares and concerns
continued after the industry was rocked by a melaminetainted milk scandal in 2008, followed by a series of
illegal additive scandals, fake lamb and beef, and longexpired chicken feet. The latest scandals, in January 2014,
were the discovery of fox meat being passed as donkey
meat sold at Wal-Mart Stores Inc (NYSE: WMT) and the
illegal injection of dirty water into lamb. These incidents
have weakened consumer confidence, shifted consumer
preferences to imported products and big brands, and
affected the reputation of Chinas food industry. Consumer
confidence in foreign big dairy brands was affected by the
Fonterra safety scare in New Zealand in 2013, opening
opportunities to local big brands to regain market share.
The Chinese Government has introduced regulations
that require the production of safer and healthier foods.
However, the continuing scandals underlined the fact
that food safety standards are still poor despite measures
to revamp the industry. Dissatisfaction among Chinese
consumers and poor supervision of food safety by smaller
producers will continue to affect overall demand for and
reputation of domestic products.

imports for the next few months leading up to the next


harvest season. China is likely to continue restructuring its
dairy industry to build self-sufficiency in dairy products.
A shift in consumption patterns should influence
companies sales and profit margins. Rising standards
of living and growing awareness of health and nutrition
have led many Chinese to shift from pork to beef, lamb
and poultry. They are willing to pay more for better quality
products, benefiting high-quality meat producing countries
such as Australia.
Australians have become more accepting of new wine
brands and their purchasing decisions are likely to be
influenced by sales and promotions. The new purchasing
pattern is helping to drive growth in the sector, with
retailers, packagers and processors benefiting from
competition in the market.
The health-conscious market will continue to demand
more nutritious, safer and organic products, and this will
remain a key trend in the Asian F&B industry over the next
few years. Most F&B companies will focus on strategies,
including the introduction of new products and improving
operational efficiency to deliver better growth in the next
few months.
Volatile food commodities prices, uncertain weather
conditions and tighter food safety regulations could
challenge companies profit. Companies will need to reduce
costs and improve operational efficiencies while placing
a greater emphasis on quality control and regulatory
compliance. Quality control is rapidly becoming the main
focus of the Japanese food industry following the impact of
radiation exposure on food supply.
The highly protected agricultural sector prevented Japanese
food processors sourcing cheaper inputs and thus tight
controls may stop the industry from regaining domestic
food market as consumers seek lower priced products.
M&A activity is expected to continue solid over the next
six months, creating fewer but larger food companies,
particularly in the dairy sector.

Market Outlook
Most Asian F&B industries are expected to grow at slower
pace in the first half of 2014. The Philippines rice selfsufficiency plan has been postponed due to Super Typhoon
Haiyan in November 2013. The country will increase rice

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Industry Report - Food & Beverage - March 2014

Country Profile
Australia
Sector Overview
Australias F&B industry did relatively well over the past
six months, although competition among food makers
intensified. Most leading F&B companies experienced
higher raw material costs and a change in consumer
consumption patterns.
Growing health concerns led to lower demand for sugary
drinks. Domestic taste and preference for alcoholic
beverages has shifted from beer to wine and spirits,
Australian Bureau of Statistics (ABS) data shows. Overall
alcoholic beverage consumption has been declining over
the past few years, leading producers to increase domestic
promotion activities or seek opportunities abroad.
Industry Size and Value
The sector has expanded over the past few years and is one
of the countrys largest manufacturing industries. Higher
productivity, consistent high quality and growing demand
for premium and healthier food items, has contributed
to growth. Despite the stronger Australian dollar, the
value of F&B exports grew by 7.69% to A$20.17 billion
(US$17.71 billion) in the first nine months of 2013, from
A$18.73 billion (US$16.44 billion) a year earlier, due to
stronger demand. Imports grew by 7.55% to A$8.26 billion
(US$7.25 billion) from A$7.68 billion (US$6.74 billion),
resulting in a 7.78% rise in the trade surplus to A$11.91
billion (US$10.46 billion), from A$11.05 billion (US$9.7
billion) a year earlier.
Dairy Segment
The dairy industry is one of the leading food industries in
Australia. The ABS estimates the total value of exports of

milk and dairy products grew by 0.57% to A$1.77 billion


(US$1.55 billion) in the four months ended October 2013,
from A$1.76 billion (US$1.54 billion) a year earlier, due
to slower demand from Asia. Most dairy products, such as
butter, whole milk powder (WMP), butter oil, and cheddar,
have seen higher prices. Despite sales volume dropping by
14.48% to 29,499 tonnes, from 34,495 tonnes, an increase
in WMP prices led to a 46.17% rise in export value to
A$181.98 million (US$159.78 million), from A$124.5
million (US$109.31 million) in the four months ended
October 2012.
Wine Segment
The wine segment has been a strong contributor to sector
growth due to major quality improvement and substantial
marketing expenditure. However, the average profit margin
of ten vintners fell to 5.9% in 2012, from 9.6% in 2007,
according to the Winemakers Federation of Australia
(WFA). With WFAs 2014-2016 action plan, which aimed
to increase global competitiveness and growth in domestic
and overseas sales, profit margin should improve.
ABS data shows domestic wine sales fell by 0.24% to
453.92 million liters in the fiscal year ended September
2013, from 454.99 million liters a year earlier, due to lower
demand for local products. However, sales for sparkling
wine grew by 2.92% to 35.59 million liters, from 34.58
million liters, while those of carbonated wine grew by
4.85% to 12.75 million liters, from 12.16 million liters.
Sales of imported wines fell by 4.49% to 78.86 million
liters, from 82.57 million liters. Despite lower domestic
demand, an increase in imported wine prices led to a
12.37% rise in total sales value to A$593.72 million

Table 2: Australias Processed F&B Trade Statistics for the First Nine Months

Exports
Imports
Surplus

2009
A$17.13 billion
(US$15.04 billion)
A$6.89 billion
(US$6.05 billion)
A$10.24 billion
(US$8.99 billion)

2010
A$15.81 billion
(US$13.88 billion)
A$6.69 billion
(US$5.87 billion)
A$9.12 billion
(US$8 billion)

2011
A$17.91 billion
(US$15.72 billion)
A$7.15 billion
(US$6.28 billion)
A$10.76 billion
(US$9.45 billion)

2012
A$18.73 billion
(US$16.44 billion)
A$7.68 billion
(US$6.74 billion)
A$11.05 billion
(US$9.7 billion)

2013
A$20.17 billion
(US$17.71 billion)
A$8.26 billion
(US$7.25 billion)
A$11.91 billion
(US$10.46 billion)

Source: Australian Bureau of Statistics

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Industry Report - Food & Beverage - March 2014

Country Profile - Australia


(US$521.28 million), from A$528.36 million (US$463.9
million) in the fiscal year ended September 2012.

(US$21.28 million) in fiscal 2013, the enviable result of


stronger operating cash flow.

Leading Companies

Market Outlook

Coca-Cola Amatil Ltd (ASX: CCL)

The Australian F&B industry is posed to grow in early


2014, due to rising demand for high quality and healthy
products. Increasing health consciousness will create new
opportunities for F&B exports and for manufacturers in
more distant countries and regions, as well as expansion
in existing markets. However, competition will remain
intense, especially in the alcoholic beverage segment,
forcing producers to increase marketing efforts, which will
affect margins.

Coca-cola Amatil Ltd (CCA) is the largest soft-drink


bottler in Australia. Its net revenues fell by 2.07% to
A$2.36 billion (US$2.07 billion) in the first half of 2013,
from A$2.41 billion (US$2.12 billion) a year earlier, due
to lower domestic retail sales. However, sales in Indonesia
continued to grow following the introduction of new
products. Despite lower operating expenses, operating
income fell by 6.92% to A$373.9 million (US$238.28
million), from A$401.7 million (US$352.69 million), while
net profit fell by 12.31% to A$215.9 million (US$189.56
million), from A$246.2 million (US$216.16 million) a
year earlier. The company has set 2014 investment at a
maximum A$350 million (US$307.3 million).
Patties Foods Ltd (ASX: PFL)
Leading frozen foods company Patties Foods Ltds sales
increased by 3.82% to A$244.8 million (US$214.93
million) in the fiscal year ended June 30, 2013, from
A$235.8 million (US$207.03 million) a year earlier.
Operating income fell by 54.11%, from A$31.6 million
(US$27.74 million) to A$14.5 million (US$12.73 million),
due to increased raw material costs, higher logistics and
marketing expenses, and an impairment loss from its
frozen fruit business. Increases in operating expenses
caused profit to fall by 75.41% to A$4.79 million (US$4.21
million), from A$19.48 million (US$17.1 million). Lower
net income and higher capital expenses reduced free cash
flow to a negative A$1.76 million (US$1.55 million), from
A$151,000 (US$132,576.64) a year earlier.
Bega Cheese Ltd (ASX: BGA)
In the fiscal year ended June 30, 2013, leading dairy
producer Bega Cheese Ltds revenues grew by 8.28%
to A$1.01 billion (US$886.77 million), from A$932.9
million (US$819.08 million) a year earlier, thanks to higher
demand in domestic and overseas markets. Operating
income grew by 30.54% to A$35.35 million (US$31.04
million), from A$27.08 million (US$23.78 million), while
net profit grew by 24.57% to A$25.45 million (US$22.34
million), from A$20.43 million (US$17.94 million) a year
earlier. Bega Cheese had cash reserves of A$24.24 million

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Industry Report - Food & Beverage - March 2014

Country Profile
China

Sector Overview
Food price inflation remained high, mainly due to higher
production costs and rising demand from domestic and
emerging markets, and intensified competition caused
some companies to withdraw from the market. On October
24, 2013, Japan-based dairy company Meiji Holdings
Co Ltd (TSE: 2269) withdrew its milk formula business
from the China market as sales dropped dramatically after
radioactive caesium was found in its products in 2011.
However, most leading F&B companies financial results
improved.
Industry Size and Value
An emerging middle class, a growing population and
rising standards of living continued to drive a huge
wave of consumer spending on F&B. According to the
National Industry Association (CNFIA) exports were
worth US$705.7 million in the first half of 2013, and
imports were worth US$271.2 million. Total F&B sales,
including processed agricultural products, foods, liquor,
beverages and fine tea, grew by 15.31%, from RMB36.9
billion (US$6.08 billion) in first half 2012 to RMB42.55
billion (US$7.01 billion). Consumption of processed
food increased the most, by 17.5%, to RMB8.42 billion
(US$1.39 billion), from RMB7.17 billion (US$1.18
billion) a year earlier.
Beer Segment
Beer production has expanded over the past few years
as it has gained popularity. Production grew by 4.32% to
44.69 billion liters in the first ten months of 2013, from
42.84 billion liters a year earlier, according to the National
Bureau of Statistics of China (NBS). Exports grew by 8%

to 203.37 million liters, from 188.31 million liters, while


imports grew by 61.2% to 153.43 million liters, from 95.18
million liters in the first ten months of 2012, thanks to
greater acceptance of foreign brands.
Dairy Segment
Rapid population growth, improved standards of living
and a more westernized diet provide opportunities for
dairy manufacturers. Although domestic dairy production
grew by 7.72% to 19.82 million tonnes in the first nine
months of 2013, from 18.4 million tonnes a year earlier,
the market is experiencing supply crisis, due to drought in
2013. Growing demand for imported milk powders led to
a 33.38% rise in imports to US$20.42 million, compared
with US$15.31 million a year earlier.
Leading Companies
Tsingtao Brewery Co Ltd (SSE: 600600)
As the biggest brewer in China, Tsingtao Brewery Co
Ltd controls more than 14% of the Chinese market
and about half of the countrys beer exports. In the
first nine months of 2013, net sales rose by 10.96% to
RMB24.19 billion (US$3.99 billion), from RMB21.8
billion (US$3.59 billion) a year earlier, thanks to
higher demand for premium products. Increased sales
offset higher expenses, causing net profit to rise by
29.17% to RMB2.17 billion (US$357.74 million), from
RMB1.68 billion (US$276.96 million) a year earlier,
while operating income rose by 4.41% to RMB4.26 billion
(US$702.3 million), from RMB4.08 billion (US$672.62
million).

Table 3: Sales of Food and Beverages in China (RMB millions)

Processed Agricultural Products


Processed Food
Liquor, Beverages and Fine Tea

H1 2012
23,358.87
(US$3.85 billion)
7,167.34
(US$1.18 billion)
6,375.85
(US$1.05 billion)

H1 2013
26,956.14
(US$4.44 billion)
8,421.63
(US$1.39 billion)
7,172.83
(US$1.18 billion)

Rise/Fall (%)
15.4%
17.5%
12.5%

Source: National Industry Association (CNFIA)

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Industry Report - Food & Beverage - March 2014

Country Profile - China


Beijing Yanjing Brewery Co Ltd (SSE: 000729)
The worlds ninth biggest brewer, by sales volume, Beijing
Yanjing Brewery Co Ltd controls more than 85% of the
Beijing market and has begun to focus on central and
western regions of China, and on Guangdong and Fujian
provinces. In the first nine months of 2013, revenue
rose by 5.7% to RMB11.86 billion (US$1.96 billion),
from RMB11.22 billion (US$1.85 billion) a year earlier.
Despite higher operating expenses, net profit rose by
13% to RMB1,002.42 million (US$165.26 million), from
RMB887.05 million (US$146.24 million) in first nine
months of 2012.
China Resources Enterprise Ltd (HKSE: 0291)
China Resources Enterprise Ltd (CRE) is one of Chinas
largest consumer conglomerates. Its top beer brand Snow
had a 20% share of the China market in 2012. Sales rose
by 8.5% to 9.83 million kiloliters in the first nine months
of 2013, from 9.06 million kiloliters a year earlier, due to
higher sales of Snow beer. Net sales value rose by 14.54%
to HK$112.44 billion (US$14.5 billion), from HK$98.17
billion (US$12.66 billion). Net profit rose by 6.67% to
HK$1.92 billion (US$247.56 million), from HK$1.8
billion (US$232.08 million) a year earlier, while the beer
divisions net profit totaled HK$1.11 billion (US$143.12
million), up from HK$878 million (US$113.21 million).
Market Outlook
In the first half of 2014, Chinas F&B industry is expected
to continue to grow well in line with higher living standards
and growing food and beverage consumption, and F&B
exports and imports are likely to increase. F&B companies
are in a good position to continue growing, albeit at a
slower pace, with ongoing investment in product branding
and innovation.

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Industry Report - Food & Beverage - March 2014

Country Profile
India

Sector Overview
Rising incomes, changing lifestyles and a growing
population increased demand for premium food and drinks.
Indians continued to turn to processed food, owing to
greater levels of overseas travel and the booming domestic
tourism industry, leading to rising demand for processed,
ready-to-eat and ready-to-cook food.

largest market share, 64.39% of the total value of


F&B exports in the six months ended September
2013. Huge global demand during the 2013/2014
financial year led to higher prices and favored the export
of cereals.

Although the Government has introduced minimum


support prices (MSP) aimed at helping farmers and
consumers, its own food stockpiling has caused prices to
increase and affected companies profit margins. However,
most leading F&B companies earned higher profits in the
first nine months of 2013, thanks to growing domestic and
overseas demand.

Demand for imported products declined, apart from those


from Canada, China and the UK, due to a depreciating
rupee. Processed fruits and vegetables had the largest
market share, 69.59% or Rs56.27 billion (US$914.39
million), of F&B imports in the six months ended
September 30. The least was processed meat with Rs38.02
million (US$617,825). Processed food imports were
Rs80.86 billion (US$1.31 billion).

Industry Size and Value

Cereals and Cereal Preparations Segment

As the worlds second largest food producer after China,


Indias food processing industry is one of the largest
sectors in terms of production, consumption, and exports
and imports. The industry produces mainly processed fruits
and vegetables, processed meat, dairy products, cereals,
and other processed foods.

India is the worlds largest producer and exporter of


cereal products. The All India Rice Exporters Association
(AIREA) estimates India exports ten million tonnes, or
9.1%, of its rice production annually. In the six months
ended September 2013, exports were worth Rs339.99
billion (US$5.52 billion) and imports Rs2.3 billion
(US$37.38 million), according to the DGCI&S. Lower
global prices and a depreciating rupee reduced companies
profit margins.

The Directorate General of Commercial Intelligence


and Statistics (DGCI&S) estimates cereals have the
Table 4: Indian Exports by Segment (Rupees)

2011-2012

2012-2013

2013/2014
(Apr-Sept)

45.07 billion
(US$732.39 million)

50.85 billion
(US$826.31 million)

33.06 billion
(US$537.23 million)

Processed Meat

300.00 million
(US$4.88 million)

215.61 million
(US$3.5 million)

47.89 million
(US$778,213)

Dairy Products

2.89 billion
(US$46.96 million)

14.12 billion
(US$229.45 million)

13.84 billion
(US$224.9 million)

Cereals

309.11 billion
(US$5.02 billion)

530.36 billion
(US$8.62 billion)

326.51 billion
(US$5.31 billion)

Other Processed Foods

300.47 billion
(US$4.88 billion)

356.97 billion
(US$5.8 billion)

133.67 billion
(US$2.17 billion)

669.54 billion
(US$10.88 billion)

954.46 billion
(US$15.51 billion)

507.12 billion
(US$8.24 billion)

Processed Fruits and Vegetables

Total

Source: DGCI&S

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Industry Report - Food & Beverage - March 2014

Country Profile - India


Dairy Segment
India is the worlds largest producer and consumer of milk
and dairy products, including butter oil, skimmed milk
powder, ghee, milk powder and fat. In the six months
ended September 30, exports were worth Rs13.84 billion
(US$224.9 million) and imports Rs1.02 billion (US$16.58
million). Indias large and growing dairy market is
expected to attract foreign companies, and increases
in sales will enable local companies to capitalize on the
growing market.

prices should continue to rise, forcing companies to absorb


or pass the costs to consumers.
The industry is expected to continue to benefit from the
Department of Commerces target to double exports. It will
also be boosted by its focus on R&D to improve quality
and diversification, as well as minimize wastage during
food processing.

Leading Companies
Tata Global Beverages (NSE: TATAGLOBAL)
Tata Global Beverages, formerly known as Tata Tea Ltd,
is the worlds second largest tea producer, with 3,000
employees in more than 40 countries. In the first nine
months of 2013, its net sales rose by 4.08% to Rs37.02
billion (US$601.58 million), from Rs35.57 billion
(US$578.01 million) a year earlier, due to growing demand
in domestic and international markets. The heightened
performance reflected an ongoing emphasis on higher
margin products and on boosting operating efficiencies.
First nine months consolidated net profit rose by 48.22%
to Rs2.92 billion (US$47.45 million), from Rs1.97 billion
(US$32.01 million) a year earlier.
Britannia Industries Limited (NSE: BRITANNIA)
Britannia Industries is a leading biscuit manufacturer with
a 30% share of the Indian bakery market. Its net sales grew
by 14.91% to Rs14.03 billion (US$227.99 million) in the
first quarter ended June 30, 2013, from Rs12.21 billion
(US$198.41 million) a year earlier, while net profit leaped
by 98.6% year on year from Rs434.5 million (US$7.06
million) to Rs862.9 million (US$14.02 million), due to
innovative cost-cutting measures and effective marketing
strategies.
Market Outlook
The World Trade Organization (WTO) agreed to India
storing food for food security and fixing a MSP from
December 6, 2013. It also allowed India to grant wheat
and rice subsidies to millions residents under its new Food
Security Act, which comes into effect in April 2014. The
moves will cost the Government Rs1.25 trillion (US$20.31
billion), widening its budget deficit. Nevertheless, food

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Industry Report - Food & Beverage - March 2014

Country Profile
Japan

Sector Overview
The F&B industry suffered over the first ten months of
2013 due to stagnant exports and a lower demand for
imported food and beverages. The environment remained
challenging, with recent false labeling on local and
imported food products, the unsolved radiation leakage
problem at the Fukushima nuclear plant, export restrictions
and rising costs of raw materials. A declining birth rate and
an ageing population resulted in a shrinking processing and
manufacturing workforce.

Rice Segment

In recent years, food safety and traceability have become


the main factors influencing Japanese purchasing decision,
leading many to prefer imported products. People demand
safer and higher-quality foods, while increasingly hectic
lifestyles have created greater demand for convenience and
instant food.

Japanese rice consumption has been declining and is


likely to continue on a downward trend due to an ageing
population, a shift in diet and radioactive cesium from the
Fukushima disaster being found in local rice. In addition,
growing preferences for western food among the younger
generation, and the proliferation of restaurants and
convenience stores have led to less cooking at home and
slumping rice consumption. Exports dropped by 34.43%
to 1.6 billion (US$15.37 million) in the first 11 months
of 2013, from 2.44 billion (US$23.45 million) a year
earlier, due to lower overseas demand. Higher demand
for overseas products increased imports by 26.98% to
45 billion (US$432.41 million), from 35.44 billion
(US$340.54 million).

Industry Size and Value

Leading Companies

Japan, a net importer of food, continued to face an F&B


trade deficit due to a shortage of agricultural land, a rapidly
ageing population, and high labor and production costs.
Processed food exports increased by 0.28%, from US$3.6
billion in the first ten months of 2012 to US$3.61 billion in
the same period in 2013, according to the Japan External
Trade Organization (JETRO). Processed food imports fell
by 9.47% to US$55.38 billion, from US$61.17 billion a
year earlier, while the trade deficit declined to US$51.77
billion, from US$57.57 billion. The impact of the nuclear
disaster on exports continued, although the yens drop
made Japanese exporters more competitive.

Ajinomoto Co Inc (TSE: 2802)

Confectionery Segment
The growing global demand for dairy products, especially
for health-oriented enriched items, suggests a promising
outlook for the segment. Trade Statistics of Japan data
shows that although volume fell, the value of dairy imports
grew by 17.48% to 131.77 billion (US$1.27 billion) in
the first 11 months of 2013, from 112.16 billion (US$1.08
billion) a year earlier, due to a depreciating yen. Demand
for products from Thailand, Denmark, Ireland, Germany,
Italy, and Finland increased. Exports grew by 31.78%
to 1.41 billion (US$13.55 million), from 1.07 billion
(US$10.28 million), thanks to higher demand from key
customers such as Taiwan, Hong Kong, and Thailand.

Ajinomoto Co Inc, Japans top seasoning maker, is the


worlds largest producer of aspartame and produces
cooking oils, sweeteners, amino acids and pharmaceuticals.
Due to lower domestic demand, net sales decreased by
3.72% to 487.08 billion (US$4.68 billion) in the half
year ended September 30, 2013, from 505.92 billion
(US$4.86 billion) a year earlier. Net profit fell by 46.05%
to 22.18 billion (US$213.13 million), from 41.11 billion
(US$395.03 million) a year earlier, due to higher input
costs and an absence of extraordinary gains on transfer of
employees pension fund.
Yakult Honsha Co Ltd (TSE: 2267)
Yakult Honsha Co Ltd manufactures fermented milk
drinks, fruit juices and noodles, which it distributes through
its home delivery and retail store channels. In the first half
of the fiscal year ending March 31, 2014, net sales rose by
7.74% to 172.67 billion (US$1.66 billion), from 160.26
billion (US$1.54 billion) a year earlier. The rapidly ageing
population and healthy trends in consumer diets drove
demand for functional foods. Net profit increased by
80.07% to 10.66 billion (US$102.43 million), from 5.92
billion (US$56.89 million) a year earlier, mainly due to
gains from investments.

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Industry Report - Food & Beverage - March 2014

Country Profile - Japan


Market Outlook
The Japanese F&B industry is expected to grow at slow
pace in the first half of 2014, as food safety problems
will likely continue to pull down revenue prospects.
Many countries have not yet lifted their bans on Japanese
agricultural products, particularly marine products,
and these have affected catches and the processed food
business. The Government and companies are working to
restructure business strategies and restore both domestic
and international consumer confidence in local products.
The Government expects exports to reach 1 trillion
(US$9.61 billion) by 2020 after it solves radiation leakage
and food safety problems.
Food manufacturers must ensure that raw materials used
are safe to regain customer loyalty. Processed food and
western cuisine have become popular among Japanese
consumers, signaling opportunities for manufacturers to
develop custom packaging for convenience and ready-toeat foods.

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Industry Report - Food & Beverage - March 2014

Country Profile
Thailand
Sector Overview
In 2011, the average household spent 24.77% of its
income on F&B, compared with 25.96% in 2009, National
Statistical Office of Thailand (NSO) data shows. The
performances of F&B companies were affected by a
reduction in consumer spending, higher household debt
and a sluggish economy. A slowdown in F&B production,
due to drought, prolonged political protests and sharp
capital outflow, affected the industry.
Most Thais cut their spending by preparing food at home
and consuming fewer alcoholic beverages. Spending
on home cooking increased to 64.47% of average F&B
expenditure per capita per month in 2011, from 54.25%
in 2009, while spending on prepared food fell to 29.56%
from 37.53%. Many preferred to drink non-alcoholic
beverages at home, leading spending to increase to 4.33%
from 4.05%.
Industry Size and Value
F&B processing is one of Thailands largest manufacturing
industries, but imports of food, beverages and dairy
products rose by 5.49% to THB111.03 billion (US$2.46
billion) in the first nine months of 2013, from THB105.25
billion (US$2.33 billion) a year earlier, due to the stronger
baht. Food exports, which have grown at a respectable
rate over the past few years, fell by 9% to THB374.49
billion (US$8.3 billion), from THB416.12 billion
(US$9.22 billion) a year earlier, as agricultural production
slowed. Demand for sugar, processed meat and processed
crustaceans fell as the stronger baht made Thai exports less
competitive.
Although beverage exports increased by 14.77% to
THB38.47 billion (US$852.26 million), from THB33.52
billion (US$742.6 million) in first nine months of 2012,

F&B exports declined by 8.14% to THB412.97 billion


(US$9.15 billion), from THB449.55 billion (US$9.96
billion) a year earlier.
Rice Segment
Thailand is one of the worlds biggest rice producers but
suffers from low productivity because of poor farming
techniques, labor shortages, lack of irrigation, varying
weather conditions, high input costs and inadequate credit
support from the Government. The Thai Rice Exporters
Association estimates exports dropped by 8.81% to
THB96.4 billion (US$2.14 billion) in the first nine months
of 2013, from THB105.71 billion (US$2.34 billion) a year
earlier, due to drought affecting crops.
Alcoholic Beverages Segment
Thailand used to be the only country in the WTO using the
ad valorem tax system for alcohol products, under which
taxes are based on production cost rather than alcohol
content. Since September 4, 2013, drinkers have faced
higher prices for imported products as the Government
imposed higher alcohol excise taxes, based on the last
wholesale price excluding value-added tax. The new
calculation method aimed to increase competitiveness of
local products.
Leading Companies
Charoen Pokphand Foods Plc (SET: CPF)
Thailands leading agro-industrial and food conglomerate
Charoen Pokphand Foods Plcs (CPF) sustained focus
on product innovation and geographic expansion helped
achieve robust sales growth. Revenue rose by 8.72%

Table 5: Thailands F&B Trade for the First Nine Months (THB billions)

2010

2011

2012

2013

Exports

337.07
(US$7.47 billion)

419.4
(US$9.29 billion)

449.55
(US$9.96 billion)

412.97
(US$9.15 billion)

Imports

67.35
(US$1.49 billion)

89.93
(US$1.99 billion)

105.25
(US$2.33 billion)

111.03
(US$2.46 billion)
Source: Customs Department of Thailand

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Industry Report - Food & Beverage - March 2014

Country Profile - Thailand


to THB285.89 billion (US$6.33 billion) in the first nine
months of 2013, from THB262.96 billion (US$5.83
billion) a year earlier. Despite higher sales, net profit fell
by 66.47% to THB6.8 billion (US$150.65 million), from
THB20.28 billion (US$449.28 million) a year earlier, due
to higher operating expenses, increased financial costs and
foreign exchange loses.
Thai Beverage Plc (SGX: THBEV)
Thailands leading brewer Thai Beverage Plc, or ThaiBev,
produces spirits, beer, non-alcoholic drinks and food. It
has more than 20 distilleries in Scotland, France, Poland,
and Ireland. Despite higher spending on marketing and
advertising, revenue fell by 7.13% to THB111.03 billion
(US$2.46 billion) in the first nine months of 2013, from
THB119.56 billion (US$2.65 billion) a year earlier, due to
lower demand for beer and non-alcoholic beverages. Net
profit dropped by 22.4% to THB3.43 billion (US$75.99
million), from THB4.42 billion (US$97.92 million) a year
earlier.
Market Outlook
Thailands F&B industry is likely to recover at a slow
pace in the first half of 2014, with the Ministry of Finance
expecting the economy to grow by 0.5% due to low
private investment and a cutback in consumer spending.
Growth will be affected by droughts and shrimp disease
that occurred in 2013, and by a shift in consumer behavior.
The home cooking trend will continue, while consumption
on alcoholic beverages, especially distilled spirits, should
drop, due to higher taxes.

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Industry Report - Food & Beverage - March 2014

Country Profile
The Philippines
Sector Overview
Parts of the Philippines were devastated by Super Typhoon
Haiyan in November 2013, which badly affected many
agricultural and processed food businesses, particularly
those in marine and sugar production, which fell and food
prices increased. One third of the Philippines total rice
plantations were also affected by the disaster, according
to the United Nations Food and Agriculture Organization
(FAO). The Department of Agriculture (DA) forecast rice
production could grow at 4% for the next three years, lower
than the Governments 6% target for self-sufficiency.
Funds and food aid were provided from countries around
the world to help millions of victims to build their lives.
The Government will need to allocate PHP361 billion
(US$11 billion) over the next four years to rehabilitate the
affected areas, according to the National Economic and
Development Authority (NEDA).
In the first ten months, before the typhoon, a strong export
performance by the processed F&B industry helped boost
manufacturing exports to US$36.79 billion, compared
with US$37.99 billion for the whole of 2012, Philippines
National Statistics Office (CENSUS) data shows. The
Government resumed rice exports in 2013 and plans to
introduce genetically modified rice in two to three years if
no risks are identified.
Industry Size and Value
The processed food sector is one of the Philippines biggest
industries and has seen substantial growth over the years,
thanks to government efforts in promoting F&B products
and enhancing food safety standards to international levels.
Exports rose by 21.06% to US$1.22 million in the first
ten months, from US$921.95 million a year earlier, due
largely to higher demand from Japan, the US, and China,
according to CENSUS figures.
Diary Segment
Rapid population growth, higher household incomes, and
growing demand for western-style food products have
increased demand for diary products. Consumption totaled
925.97 million kg in the first half of 2013, while the figure
for the whole of 2012 was 1.82 billion kg, the National
Dairy Authority (NDA) reported. The Government aims to

boost production and lower imports of dairy products. First


half 2013 production totaled 9.59 billion tonnes, compared
with 18.45 billion tonnes in fiscal 2012, and 16.45 billion
tonnes in fiscal 2011.
Lower domestic production and increased international
dairy product prices caused export volumes to fall to 6.33
billion tonnes in the first half, compared with132.24 billion
tonnes in fiscal 2012 and 295.82 billion tonnes in fiscal
2011, while export sales dropped to US$10.39 million,
compared with US$82.86 million in 2012.
Leading Companies
San Miguel Corp (PSE: SMC)
Diversified conglomerate San Miguel Corp has established
a strong presence in global food markets. In the first nine
months of 2013, its net sales rose by 6.66% to PHP542.6
billion (US$16.53 billion), from PHP508.7 billion
(US$15.5 billion) a year earlier, due to higher demand
for processed meat, dairy and coffee, but there was lower
demand for beer. Beer sales volume dropped by 10% to
147.6 million cases, from 164 million cases. Consolidated
net income dropped by 59.89% to PHP7.5 billion
(US$228.49 million), from PHP18.7 billion (US$569.7
million) in the first nine months of 2012, due to a PHP12.3
billion (US$274.72 million) loss in foreign exchange.
RFM Corp (PSE: RFM)
RFM Corp, one of the Philippines largest diversified food
and beverage companies, saw net sales fall by 8.97% to
PHP7.1 billion (US$216.3 million) in the first nine months
of 2013, from PHP7.8 billion (US$237.63 million) a year
earlier, due to disposal of its meat business in 2012 and
bad weather in 2013. Lower commodity input prices cut
processing costs and improved net income by 19.05% to
PHP525 million (US$15.99 million), from PHP441 million
(US$13.44 million).
Market Outlook
The Philippines food industry is likely to grow at a
slow pace in the first half of 2014, due to Super Typhoon
Haiyan that struck on November 8, 2013. Agricultural

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Industry Report - Food & Beverage - March 2014

Country Profile - The Philippines


output is expected to fall in the near term and imports
should increase to meet demand, particularly for rice.
Food prices will continue to increase, due to insufficient
supply. Leading players in the industry are likely to expand
business operations and to invest more overseas to obtain a
bigger slice of the global market.

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Industry Report - Food & Beverage - March 2014

Currency Conversion Table


Currency exchange rates as of January 21, 2014

Currency Unit

US$ per Unit

Units per US$

US Dollar (US$)

Australian Dollar (AS$)

0.877991

1.138964

Chinese Renminbi (RMB)

0.164859

6.065803

Hong Kong Dollar (HK$)

0.128936

7.755801

Indian Rupee (Rs)

0.016250

61.537516

Japanese Yen ()

0.009609

104.072316

Philippines Pesos (PHP)

0.022154

45.139594

Thai Baht (THB)

0.030465

32.824996

New Zealand Dollar (NZD)

0.824592

1.212720
Source: Federal Reserve Bank of New York

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Industry Report - Food & Beverage - March 2014

The Scope Of This Report


This report examines the food and beverage industries in the Asia-Pacific, with a focus on Australia, China, India, Japan,
Thailand and the Philippines. As part of our definition, discussion and analysis, a number of industry segments are
examined including agribusiness and food processing. The report aims to paint a picture of the current environment and
industry development using available data and by examining key public companies in each segment.
Research analysts draw on a range of credible industry and company data sources as well as news and information
services to research and analyze the current trading environment, industry landscape and market trends and outlook for
a particular sector. Primary sources are used, unless otherwise indicated, and include company data, e.g. annual reports
and company financial results; macroeconomic and trade data; data and information from global and country regulatory,
industry and trade bodies; government data; and reports from industry organizations and private research organizations.
Industries covered by the industry reports are defined by standard industry classification systems and leading companies
are identified on this basis. The following SIC codes are relevant to the industry: 2013 (Sausages and Other Prepared
Meats); 2015 (Poultry Slaughtering and Processing); 2023 (Dry, Condensed, and Evaporated Dairy Products); 2024 (Ice
Cream and Frozen Desserts); 2026 (Fluid Milk); 2043 (Cereal Breakfast Foods); 2044 Rice Milling); 2052 (Cookies and
Crackers); 2064 (Candy and Other Confectionery Products); 2082 (Malt Beverages); 2083 (Malt); 2084 (Wines, Brandy,
and Brandy Spirits); 2086 (Bottled and Canned Soft Drinks and Carbonated Water); 2091 (Canned and Cured Fish and
Seafood); 2092 (Prepared Fresh or Frozen Fish and Seafood) and; 2098 (Macaroni, Spaghetti, Vermicelli, and Noodles).

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Industry Report - Food & Beverage - March 2014

Key References
Global
US Department of Agriculture (USDA)
The USDA is the government agency that provides expertise, resources and information for the agricultural production
sector in the US.
http://www.usda.gov
World Trade Organization (WTO)
The global international organization dealing with the rules of trade between nations that aims to liberalize trade, negotiate
trade agreements and settle trade disputes.
http://www.wto.org

Australia
Australian Bureau of Agricultural and Resource Economics (ABARE)
A government economic research agency that provides economic analysis and forecasts to enhance the competitiveness
of the Australian agricultural, mineral, energy and forestry industries.
http://www.abare.gov.au
Australian Bureau of Statistics (ABS)
An Australian government agency responsible for collecting, collating and analyzing national statistics.
http://www.abs.gov.au
Australia Food and Grocery Council (AFGC)
AFGC is a national organization responsible for the packaged food, drink and grocery products manufacturers.
http://www.afgc.org.au
Australian Trade Commission (Austrade)
Austrade is the Australian Governments trade and investment development agency.
http://www.austrade.gov.au
Meat and Livestock Australia (MLA)
MLA is a producer-owned company that provides services to the Australian red meat industry, including to producers,
processors, exporters, live exporters and retailers.
http://www.mla.com.au
National Food Industry Council (NFIC)
A non-government agency created to drive the implementation of Australias National Food Strategy. The council is
responsible for providing strategic direction, setting priorities and encouraging competitiveness and growth by working
closely with food businesses, industry bodies and government agencies.
http://www.nfis.com.au

China
China National Food Industry Association (CNFIA)
A national industry regulatory organization that promotes the development of Chinas food industry and aims to satisfy
the needs of people in urban and rural areas.
http://www.chinafoods.com

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Industry Report - Food & Beverage - March 2014

Ministry of Land and Resources (MOLAR)


A national agency responsible for the planning, administration, protection and rational utilization of natural resources
such as land, mineral and marine resources in the Peoples Republic of China.
http://www.mlr.gov.cn/mlrenglish
National Bureau of Statistics (NBS)
A government agency responsible for conducting statistical surveys on the national economy and social development.
http://www.stats.gov.cn

India
Associated Chambers by Commerce and Industry of India (ASSOCHAM)
ASSOCHAM represents the interests of various industries and trade in India and works with the Government on policy
matters; it also interacts with international organizations to promote bilateral trade for economic development.
http://www.assocham.org
India Brand Equity Foundation (IBEF)
A public-private partnership between the Ministry of Commerce and Industry, the Government of India, and the
Confederation of Indian Industry whose primary objective is to build positive economic perceptions of India globally.
http://www.ibef.org
Indian Department of Commerce
A government department under the Ministry of Commerce and Industry responsible for the countrys external trade and
all matters connected with it, including commercial relations with other countries, interstate trading, export promotional
measures and the development and regulation of export-oriented industries and commodities.
http://commerce.nic.in
Ministry of Food Processing Industries (MOFPI)
The main central agency of the Government responsible for developing a strong and vibrant food processing sector,
with a view to creating job opportunities, particularly in rural areas. It enables farmers to reap the benefits from modern
technology, create surpluses for export and stimulate demand for processed food.
http://www.mofpi.nic.in
Food Safety and Standards Authority of India (SFFAI)
Founded in 2006, SFFAI is a national authority responsible for matters concerning the food safety. It aims to regulate
manufacture, storage, distribution channels and import, and ensure availability of safe and wholesome food for human
consumption.
http://www.fssai.gov.in

Japan
Japan External Trade Organization (JETRO)
A government related organization that works to promote mutually beneficial trade and investment between Japan and
the rest of the world.
http://www.jetro.go.jp
Ministry of Agriculture, Forestry and Fisheries (MAFF)
A government body that undertakes administration related to agricultural, forestry and fisheries products.
http://www.maff.go.jp/eindex.html
Ministry of Finance (MOF)
The Ministry of Finance is responsible for implementing Japans fiscal and monetary policies.
http://www.mof.go.jp/english
Economic and Social Research Institute (ESRI)
An institution created to execute research programs covering economic policy issues as well as social policy issues.
http://www.esri.cao.go.jp/index-e.html

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Statistics Bureau of Japan


The Statistics Bureau of Japan is Japans national statistical agency and is the official source of Japanese social and
economic statistics.
http://www.stat.go.jp

Thailand
Ministry of Commerce (MOC)
Founded in 1892, MOC is responsible for matters concerning the countrys external trade that includes interstate trading,
export promotional measures and the development and regulation of export-oriented industries and commodities.
http://www.moc.go.th
Department of Foreign Trade (MFA)
A government agency under the Ministry of Foreign Affairs and Trade that formulates policy recommendations and action
plans on issues related to foreign trade and marketing and, in the process, provides strategic directions and measures to
promote exports.
http://www.mfa.go.th
National Economic and Social Economic Development Board (NESDB)
A central planning agency that undertakes studies on Thailands economy and draws up plans for its development. The
agency was established under the recommendation of the World Bank in 1959.
http://www.nesdb.go.th
National Food Institute (NFI)
A non-profit and independent network organization of the Ministry of Industry. Its goal is to promote and develop the
Thai food industry to enhance its efficiency and global competitiveness.
http://www.nfi.or.th
National Innovation Agency (NIA)
Founded in 2003, NIA is a national organization responsible for matters concerning the innovation process. Its goal is to
encourage economic restructuring and social development as well as promoting national competitiveness.
http://www.nia.or.th
Thai Food Processors Association (TFPA)
Established in 1970, TFPA is a private non-profit organization that responsible for the food processing industry in
Thailand.
http://www.tfpa.or.th

The Philippines
Center for International Trade Expositions and Missions (CITEM)
CITEM is the export promotions arm of the Philippine Department of Trade and Industry (DTI).
Department of Trade and Industry (DTI)
A government agency formed in 1898 to serve as the primary coordinator for the facilitation and promotion of trade,
industry and investment activities.
http://www.dti.gov.ph
National Statistical Coordination Board (NSCB)
The countrys policy-making and coordinating body on statistical matters.
http://www.nscb.gov.ph
National Statistics Office (NSO)
NSO is the major statistical agency responsible in collecting, compiling and publishing all censuses on population,
agriculture, commerce and industry.
http://www.census.gov.ph

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Comparative Company Data | ASIA-PACIFIC

Company

Industry Report - Food & Beverage - March 2014

Country

Ticker

Exchange

Primary SIC

Kirin Holdings Co Ltd

Japan

2503

TSE

2082

2084

2085

2086

5143

2834

Suntory Holdings Ltd

Japan

2085

2084

2082

2086

2087

5812

Asahi Group Holdings Ltd

Japan

5202

TSE

2082

2085

2086

2834

4214

4213

Yamazaki Baking Co Ltd

Japan

2212

TSE

2051

2099

5411

5812

6411

3556

Nippon Meat Packers Inc

Japan

2282

TSE

2011

2013

2015

211

251

2038

Morinaga Milk Industry Co

Japan

2264

TSE

2026

2024

2023

4212

4213

4225

Kewpie Corp

Japan

2809

TSE

2035

2032

2033

2099

4212

4222

Nisshin Seifun Group Inc

Japan

2002

TSE

2041

2045

2048

2099

2899

1541

Itoham Foods Inc

Japan

2284

TSE

2013

2011

2015

2038

2099

7363

Nissin Food Holdings Co Ltd

Japan

2897

TSE

2099

2098

2038

2034

6531

7992

Total Revenue - FYE - 1

Total Revenue - FYE - 2

Total Revenue - FYE - 3

EBITDA - FYE - 1

EBITDA - FYE - 2

EBITDA - FYE - 3

Kirin Holdings Co Ltd

$25,382,424,150

$26,771,721,841

$26,774,292,529

N/A

N/A

N/A

Suntory Holdings Ltd

$21,497,462,893

$23,295,889,991

$21,421,049,478

N/A

N/A

N/A

Asahi Group Holdings Ltd

$18,333,729,061

$18,901,656,899

$18,311,691,214

N/A

N/A

N/A

Yamazaki Baking Co Ltd

$11,047,333,927

$12,053,680,326

$11,411,975,398

N/A

N/A

N/A

Nippon Meat Packers Inc

$10,913,395,061

$12,407,428,500

$11,959,663,012

$510,140,154

$621,722,147

$654,127,285

Morinaga Milk Industry Co

$6,307,900,285

$7,049,829,329

$7,040,738,384

N/A

N/A

N/A

Kewpie Corp

$6,109,700,058

$6,238,703,756

$5,617,493,977

N/A

N/A

N/A

Nisshin Seifun Group Inc

$4,860,756,907

$5,387,807,553

$5,122,254,043

N/A

N/A

N/A

Itoham Foods Inc

$4,682,156,639

$5,454,075,819

$5,506,680,323

N/A

N/A

N/A

Nissin Food Holdings Co Ltd

$4,084,290,133

$4,640,656,010

$4,527,808,054

N/A

N/A

N/A

Net Income - FYE - 1

Net Income - FYE - 2

Net Income - FYE - 3

EPS - FYE - 1

EPS - FYE - 2

EPS - FYE - 3

Company

Company

Other SICs

Kirin Holdings Co Ltd

$652,482,151

$95,714,177

$140,079,901

$0.68

$0.10

$0.15

Suntory Holdings Ltd

$425,301,144

$809,105,912

$492,099,193

$0.62

$1.19

$0.72

Asahi Group Holdings Ltd

$663,918,411

$711,918,612

$652,575,141

$1.43

$1.53

$1.40

Yamazaki Baking Co Ltd

$125,276,387

$103,674,206

$156,431,162

$0.57

$0.47

$0.71

Nippon Meat Packers Inc

$175,612,750

$142,081,796

$202,049,322

$0.85

$0.67

$0.95

Morinaga Milk Industry Co

$53,519,263

$56,174,425

$74,438,588

$0.21

$0.22

$0.30

Kewpie Corp

$148,702,514

$121,186,822

$126,575,792

$0.99

$0.80

$0.83

Nisshin Seifun Group Inc

$146,046,985

$162,452,340

$171,327,102

$0.59

$0.65

$0.69

Itoham Foods Inc

$44,225,946

$25,112,698

$5,772,493

$0.19

$0.10

$0.02

Nissin Food Holdings Co Ltd

$201,177,374

$225,989,905

$250,656,610

$1.83

$2.05

$2.27

Total Current Assets FYE - 1

Total Current Assets FYE - 2

Total Current Assets FYE - 3

Long-Term Debt FYE - 1

Long-Term Debt FYE - 2

Long-Term Debt FYE - 3

Kirin Holdings Co Ltd

$9,166,353,672

$9,795,771,644

$8,938,927,073

$8,923,579,876

$10,783,332,097

$7,164,925,894

Suntory Holdings Ltd

$8,745,905,682

$9,979,627,634

$7,595,234,533

$5,695,489,508

$6,961,083,930

$5,808,127,757

Asahi Group Holdings Ltd

$6,144,069,536

$5,907,258,822

$5,176,465,018

$2,479,241,765

$2,589,748,842

$2,620,664,559

Yamazaki Baking Co Ltd

$2,628,319,504

$2,635,183,032

$2,511,983,997

$662,095,576

$611,061,430

$797,191,595

Nippon Meat Packers Inc

$3,573,467,118

$3,955,469,442

$3,832,584,969

$708,980,861

$878,834,731

$1,062,863,246

Morinaga Milk Industry Co

$1,358,766,174

$1,499,423,149

$1,253,790,255

$747,818,604

$1,016,381,613

$1,063,092,696

Kewpie Corp

$1,609,292,457

$1,424,987,220

$1,432,836,052

$130,651,570

$14,915,893

$24,425,442

Nisshin Seifun Group Inc

$2,330,968,770

$2,601,821,850

$2,357,435,316

$34,217,759

$25,807,564

$1,751,070

Itoham Foods Inc

$1,281,453,458

$1,348,966,390

$1,446,432,105

$283,483,513

$206,594,612

$253,506,627

$1,564,947,641

$1,850,683,972

Company

Nissin Food Holdings Co Ltd

$1,740,479,021

$81,217,829

$156,771,506

$156,750,954

Return on Equity (Most Recent Yr)

Profit Margin (Most Recent Yr)

Date FYE - 1

Date FYE - 2

Date FYE - 3

Kirin Holdings Co Ltd

5.75

2.57

31-Dec-2012

31-Dec-2011

31-Dec-2010

Suntory Holdings Ltd

6.99

1.98

31-Dec-2012

31-Dec-2011

31-Dec-2010

Asahi Group Holdings Ltd

8.30

3.62

31-Dec-2012

31-Dec-2011

31-Dec-2010

Yamazaki Baking Co Ltd

4.64

1.13

31-Dec-2012

31-Dec-2011

31-Dec-2010

Nippon Meat Packers Inc

5.61

1.61

31-Mar-2013

31-Mar-2012

31-Mar-2011

Morinaga Milk Industry Co

4.43

0.85

31-Mar-2013

31-Mar-2012

31-Mar-2011

Kewpie Corp

7.09

2.43

30-Nov-2012

30-Nov-2011

30-Nov-2010

Nisshin Seifun Group Inc

4.89

3.00

31-Mar-2013

31-Mar-2012

31-Mar-2011

Itoham Foods Inc

3.66

0.94

31-Mar-2013

31-Mar-2012

31-Mar-2011

Nissin Food Holdings Co Ltd

6.09

4.93

31-Mar-2013

31-Mar-2012

31-Mar-2011

Company

Notes to Comparative Data


- All figures are in United States dollars.

- N/A = Data Not Available.

- All figures are as reported by the company.

- N/L = Not Listed.


- Companies ranked by total revenue for the full year most recently reported.

Definitions
- Total Revenue = All revenues, including net sales, operating revenues, interest income, royalties, excise taxes etc.

- Long Term Debt = Debt due to be paid at a date more than one year in the future.

- EBITDA = Earnings before interest, taxes, depreciation and amortization.

- Return on Equity = The companys earnings divided by its equity (book value).

- EPS Cont Operations = Earnings Per Share as reported by company excluding extraordinary items.

- Profit Margin = The companys net income as a percent of revenues.

- Total Current Assets = All assets expected to be realized within the next year, includes cash, accounts receivable and inventories.

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Industry Report - Food & Beverage - March 2014

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