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The Asia Pacific region's food industry is one of the fastest growing and is expected to hold a 33% market share in the global food and beverage market in 2014. This is due to key megatrends such as increased urbanization, increasing need for health and wellness solutions and the growing sensitivity to food safety; all of which will influence consumer behavior and directly impact growth and performance of Asia Pacific's food industry.
"The Asia Pacific region encompasses a varied range of countries that differ in culture, cuisine, language and the degree of economic development. Despite their differences, the food industry in the region has been growing persistently even through the 2008/2009 economic downturn. Asia Pacific's food industry is projected to be a key economic driver as demand for food and beverage is expected to surpass the combined demand of North America and Europe by 2014," said Natasha D'Costa, research manager, Asia Pacific, Frost & Sullivan. "The key product growth areas within the Asia Pacific will be in beverages, dairy and the fortified commodities markets," said D'Costa.
The dairy industry in Asia Pacific is expected to grow faster than mature markets of the United States and Western Europe.
"This is due to the increasing awareness of health benefits associated with consumption of dairy products. China is the forerunner in this demand as its younger population increasingly incorporates dairy into its daily diet,” said D'Costa. “India is the world's largest producer of milk with most of its production used domestically as South Asians typically consume a dairy rich diet. There is a growing demand for fortified dairy products as manufacturers aim to add value to this commodity."
In Asia Pacific, the probiotic cultures market focused primarily at the fortified dairy sector is continuing to grow strongly with revenue projected from US$310 million in 2011 to US$522.8 million in 2018.
"This is because there is increasingly more research validating the health claims of improving gut health and immune system, the increasing affordability of probiotic products due to increasing purchasing power parity of consumers and the growing focus on preventive medicine since the ageing population is expected to increase, particularly in Japan, Australia and Singapore," said D'Costa.
Key demand growth within the dairy industry will be within the skim milk powder markets especially for infant nutrition in Thailand, China and Singapore. The demand for cheese is also predicted to grow, particularly in South Korea and Japan. Dairy-based beverages and fortified foods are key emerging product opportunities which will experience demand across the Asia-Pacific.
For beverages, within the Asia Pacific region, strong growth is primarily seen in non-alcoholic and fortified beverages and key growth areas within the Asia-Pacific region will be in bottled water, ready to drink teas/coffee and juices. In South East Asian countries like Vietnam and Indonesia, demand for ready-to-drink tea is growing strongly and a huge market opportunity has presented itself in flavored teas and green teas as it is well known locally and consumers easily identify with it.
"The convenience and rising awareness of health and wellness among consumers will continue to drive the growth of the ready-to-drink tea market," D'Costa said.
"The Asia-Pacific population is reported to have a vast micronutrient deficiency particularly in iron, iodine and vitamin A. Increasing concerns of poverty and malnutrition has led to initiatives to fortify basic staple commodities. In the Philippines, rice is iron fortified, in China soy sauce is fortified and in India wheat is fortified with iron and salt fortified with iodine.
"Food fortification will continue to be a key focus for governments over the next few years as they aim to introduce more fortified food products which in turn will drive demand for such foods. The market for fortified commodities such as salt, wheat and cereals will be key growth areas in the immediate future," said D'Costa.
"As the demographics and composition of Asia Pacific's population changes, so will its dietary trends and food demands, thus as the region's food industry dominates, it is expected to experience staggering growth," concluded D'Costa.
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SOURCE: Frost & Sullivan