Category: Food

Retail News Asia is committed to providing both local and global retailers with the latest Food and Food & Beverage news throughout the Asian market. This on a daily base.

  • Fast food industry in Singapore braves slump

    Fast food industry in Singapore braves slump

    The food and beverage industry is in a pickle with the slowing economy, but the fast-food industry appears to be staying ahead.

    The latest official figures show that sales at fast food outlets were better than those at restaurants this year until September, except for June.

    Fast food sales in September are estimated to have risen 2.6% over the same period last year.

    But sales at restaurants rose more modestly at 0.9%.

    Still, sales in both the restaurant and fast food categories have slowed down compared with five years ago. The fast-food industry grew just 1% last year, a significant drop from the 10% growth in 2011.

    High rental rates and a manpower crunch have contributed to the sector’s misery, as has a slowing economy. The fast food industry is doing better because of lower prices and promotions. The industry is also a lot more nimble in responding to food trends, said observers.

    “It has speed and convenience, and even the ambience is getting better at the outlets. They keep having new products, which people get on to social media and talk about,” said Singapore Polytechnic senior retail lecturer Sarah Lim.

    Fast food is also more attractive when times are bad, said Associate Professor Prem Shamdasani, from the National University of Singapore Business School.

    Texas Chicken, which opened two new outlets in Singapore in the second half of this year, said it has seen a 6% growth in same-store sales in the first nine months this year, compared with the same period last year.

    Popeyes, also a fried-chicken chain, reported the same amount of growth in sales.

    Besides the introduction of new products, the chains said sales are up because of higher productivity, which leads to lower costs, and more efficiency.

    International chains like McDonald’s and Popeyes as well as local chain BurgerUp have invested in technology such as self-ordering food kiosks that help streamline services and reduce the dependence on staff.

    “We offer burger customisation, so it is essential to have the ordering kiosk for diners to do it without hogging the order counter,” said Charlie Tan, BurgerUp’s director of strategic planning and marketing.

    He said this has led to 20% savings in manpower.

    Burger King is expected to adopt a similar system next year, said a spokesman. Texas Chicken is exploring the option.

    The use of such technology has translated into better sales.

    Dickson Low, chief operating officer of Revenue Valley Group, which runs the Popeyes chain in Singapore, said staff have noticed more customers ordering side dishes and getting bigger portions of food.

    He said this may be because the self-ordering kiosks allow them to view the images of all items on the menu.

    “For restaurants that use self-ordering kiosks, the orders for add-on and top-up items are higher by 15% (than at restaurants) without kiosks.”

    The firm has invested S$150,000 to S$200,000 (RM465,975 to RM621,632) on these kiosks for each of its five outlets.

    Prof Shamdasani said fast-food outlets find it more cost-efficient to invest because of the number of outlets they operate.

    On the other hand, restaurants outside the industry may operate fewer branches and struggle to afford the technology.

    Besides technology, the fast-food industry has also turned to the local palate to attract customers.

    McDonald’s, for example, introduced salted egg burgers in June this year. Texas Chicken introduced flavours such as sambal chicken, as well as herb and garlic chicken.

    “Singapore is the hotbed of innovation and creativity when it comes to flavour profiles. It is a trend leader,” said Amarpal S. Sandhu, Texas Chicken’s general manager for the Asia-Pacific region.

  • Le Pain Quotidien Hong Kong on par with New York City

    Le Pain Quotidien Hong Kong on par with New York City

    Belgian-founded bakery Le Pain Quotidien’s Hong Kong outlet is trading as well as the chain’s best stores, surprising the founder.

    “We knew we would make it [in Hong Kong] but we did not expect sales to be so high, comparable to our best stores in New York,” the bakery’s founder Alain Coumont divulged in an interview with the ‘Hungry Lawyer’ Marc Rubinstein.

    Le Pain Quotidien Hong Kong  was brought to the city by Dining Concepts, and recently opened its second store at Pacific Place. The city is the 18th market for the brand which now numbers 235 stores globally.

    “There are plans for a third store in Central but I can’t say where because it’s still a secret,” Coumont said. “The idea is to have at least four or five shops in Hong Kong by the end of 2017. We are also thinking of expanding to other parts of the Asia Pacific region with Dining Concepts like Singapore or Malaysia, as well as China. We are expanding naturally as we make money, not because we must.”

    He said the core of the menu was the same in Hong Kong as elsewhere in the world.

    “We have some local dishes on the menu. Originally, we had congee on the breakfast menu. We update the menu seasonally so now we have a tofu scramble instead, but the basic structure of the menu is the same as in other markets.”

    Le Pain Quotidien, which means “daily bread”, was founded in 1990 when Coumont, working as a chef, was dissatisfied  with the bread served before meals.

    le-pain-quotidien-pacific-palace-hk

    “So I decided to start making it myself as a hobby. I didn’t have space for the equipment so I rented 36 sqm next to the stock exchange in Belgium, bought a big table at a flea market, started baking two kinds of bread, and added coffee and sandwiches to help pay the rent. With the big communal table leaving nowhere for customers to hide and our two kilo sourdough loafs, the shop looked like the dining room of a monastery. Then the magic happened.”

    He had no idea his ‘hobby’ would evolve into a global brand.

    “There was no business plan. It was a hobby. I started with US$10,000 that I didn’t have, but it was an overnight success.”

    Coumont said rent was key in Hong Kong, as in New York and London – “and you need a great location”.

    “High rent creates opportunity for expensive mistakes if you pick the wrong location. But, like London and New York, Hong Kong is also a diverse city which means our staff and our customers are diverse and include cosmopolitan travellers and business people. We could just as easily be in Dubai or New York except that Hong Kong is less hot than Dubai and warmer than New York.”

    In the interview, Coumont also talks about his experiences launching the brand in New York, his passion for Chinese food and his thoughts on Hong Kong as a city.

  • 7-Eleven Malaysia committed to store expansion

    7-Eleven Malaysia committed to store expansion

    7-Eleven Malaysia is committed to further store network expansion despite the economic headwinds in the nation.

    Releasing the company’s third quarter results, CEO Gary Brown said the network now numbering 2057 stores achieved sales growth of 5.5 per cent in the three months to September 30, despite a sluggish retail market.

    However there was a “significant negative impact” from the increase in the minimum wage from July 1 on third-quarter profit.

    “The third quarter of 2016 highlights the tough retail market in which we have operated since the introduction of GST coupled with low consumer sentiment and spending.

    “[However] we remain confident that continuous store expansion, refurbishment, promotional activity, improved merchandise mix and expanded in-store services will continue to deliver positive results despite the challenging headwinds.”

    Brown noted that average spend per customer increased by about 4 per cent during the third quarter, compared with the same period last year.

    Group revenue for the quarter totalled RM547.8 million (US$23.31 million) driven by new stores, improved merchandise mix and consumer promotion activity.

    Gross profit of RM169 million improved by 5.8 per cent, mainly attributed to the 5.5 per cent revenue growth.

    Selling and distribution expenses for the quarter increased by RM14.8 million or 10.4 per cent, mainly caused by new store expansion resulting in higher staff cost, rental cost, store depreciation expense and utility costs. The increase in the minimum wage caused store staff costs to rise by approximately 10 per cent in the current quarter.

    The pre-tax profit of RM15.5 million decreased by RM7.0 million or 31.2 per cent, despite positive sales growth – and due to higher selling and distribution expenses caused by new store expansion and the impact of minimum wage increase.

    For the nine months to September 30, the group’s revenue grew by 4.9 per cent against the corresponding nine months’ revenue.

  • Jollibee to list Highlands Coffee in Vietnam

    Jollibee to list Highlands Coffee in Vietnam

    Jollibee Foods Corp’s subsidiary JSF Investment and its partner Viet Thai International plan to list the Highlands Coffee business on the Vietnam stock exchange.

    According to the announcement, Super Foods, the company owns 51 per cent of Highlands Coffee brand, will be listed publicly by July, 2019.

    The exact stake of the IPO has yet to be disclosed.

    Besides Highlands, Superfoods also owns and operates Pho 24 and the Hard Rock Cafe stores in Vietnam.

    After being acquired by Jollibee Food Corp in 2012 with a $25 million deal, Super Foods has rapidly expanded its Highlands chain throughout Vietnam up to 130 outlets in July.

  • Korean food companies move into direct retail

    Korean food companies move into direct retail

    Korean food companies are reaching out to consumers through face-to-face encounters at their own branded cafes and restaurants.

    And they are reaping the rewards: upgrading their company image, testing new products and increasing sales.

    Binggrae gave its Banana-flavored milk, a product that has survived for 40 years, a new twist in March by opening a cafe in downtown Seoul that sells beverages and ice cream based on the milk. Opened in collaboration with Hyundai Department Store that hosts the cafe at its downtown outlet, Yellow Cafe is making monthly sales of some 100 million won (US$85,178), company officials said.

    yellow-cafe

    Binggrae also worked with Olive Young, a health and beauty store chain, to sell body care products based on its milk brands. Last month, it opened a soft ice cream shop at a Lotte Department Store branch in southern Seoul.

    Company insiders say the moves are market tests for Binggrae, which is interested in starting a restaurant business.

    Orion, synonymous with its most popular snack Choco Pie, is operating a dessert cafe, Lab O, in southern Seoul. As its name suggests, the store serves as the company’s research center for dessert products, getting consumer reactions to different flavors and foods tweaked from its mainstream brands.

    Haitai Confectionery & Foods, which recently landed a smash hit with its honey-flavored potato chips, Honey Butter Chips, runs cafe Haitai Ro at two locations in Seoul. The stores sell desserts, as well as character figurines and stuffed animals that enjoy the company’s snacks. Officials at the firm say the cafes are more like “antennae shops” that catch consumers’ preferences.

    Lotte Confectionery has Guylian Cafe at the Lotte Department Store’s Lotte World branch that sells desserts made with the Belgian chocolate. Lotte took over the brand in 2008. Lotte separately operates exhibition booths for its own products in southern Seoul.

    Food companies likewise are working their way directly to consumers through restaurant-style shops.

    SPC Samlip has adopted “grocerant” as its concept store, mixing a grocery store with a restaurant. Its Glucks Schwein, which sells premium processed meats, has German sausages and beer on its menu. The company’s noodle line Hi-myon, launched in 1974, is being marketed at its noodle specialty restaurant Hi-myon Udon. Company officials say they are planning to open 20 Glucks Schwein franchises by 2018 on top of 10 noodle restaurants by the end of next year.

  • Now you can book a cook on Singapore Airlines

    Now you can book a cook on Singapore Airlines

    It’s like dining a la carte 34,000 feet above sea level. That’s the “Book the Cook” experience that you get when you fly Singapore Airlines. It’s an exclusive advance inflight meal-ordering service that allows passengers in Suites, First Class, Business Class and Premium Economy Class to pre-select a gourmet dish of their choice before their flight.

    “It’s a departure from our regular meal service,” says Hermann Freidanck, food and beverage, inflight services manager. “You get to order your main course from a wide selection in a specially prepared menu up to 24 hours before your flight. Now you won’t have to settle for a dish that is not your choice.”

    At the exclusive meal presentation before local media recently at Singapore Airline’s new-concept Silver Kris Lounge in NAIA3, we got to experience firsthand what this was like. A couple of days before the event, we were sent a special menu to choose from, which included beef tenderloin steak, roasted rack of lamb, slow-cooked marinated duck leg with mushroom risotto, marinated free-range chicken, and baked herb-marinated salmon.

    The sit-down meal included an appetizer of marinated lobster with Mediterranean vegetable salad and balsamic dressing, as well as roasted pumpkin soup or snow fungus chicken soup with Chinese mushroom and quail egg. The salad was spinach and green frisée garnished with cherry tomatoes and olives with a choice of balsamic vinegar and extra-virgin olive oil or honey-mustard dressing, while dessert was a choice of  either chocolate and banana cake with vanilla ice cream and raspberry coulis or fresh mango tiramisu with verbena mango compote and biscotti by three-Michelin-starred chef Georges Blanc.

    As part of the Book the Cook service, passengers can choose from a menu of ICP dishes. “These are dishes created by Singapore Airline’s esteemed International Culinary Panel (ICP), which is a team of celebrated Michelin chefs who have restaurants or groups of restaurants in our main destinations in Europe, America and Asia,” Freidanck explains. “They work closely with our own chefs to develop unique dishes that we serve on board.” The panel includes Alfred Portale (United States), Carlo Cracco (Italy), Goerges Blanc (France), Matt Moran (Australia), Sanjeev Kapoor (India), Suzanne Goin (United States), Yoshihiro Murata (Japan), and Zhu Jun (China).

    “Our menus are planned four to five months ahead of time, on a four-month cycle. First Class and Business Class have four different main courses, while Premium Economy Class has a third choice in addition to the usual two choices,” Freidanck shares. “The way we do our menus is what we call ‘destination-specific.’ If you are going to Frankfurt, for example, you’ll have a German dish. In First Class and Business Class, you will always have  an ICP dish. Seasonal ingredients would also affect which dishes would be available.  The Japanese, as well as the Chinese dishes, go by the seasons. A bestseller is the Maine lobster, but not every country has it. It is difficult to get lamb, for instance, but because you can order in advance, you are guaranteed your main course.”

    “And then we have the Asian dishes. We look at the passenger profile, and if it’s predominantly Singaporean, for example, we try to put a Singaporean dish. We emphasize that we must represent the cuisine properly. It always has to be authentic. It must be traditional,” Freidanck adds. ‘There are also what we call the special meals which address certain conditions of the passenger, either due to religious beliefs, dietary or allergy restrictions. You can order them and we will serve you according to what you order. It’s not like other airlines where one menu fits all.”

    Singapore Airlines also launched a new “Deliciously Wholesome” program catering to the needs of an increasing number of health-conscious travelers.

    Preservation of freshness is an important consideration. Dishes are cooked with the reheating process in mind. “There is a fine line because we have to follow the hygiene regulations,” Freidanck explains. “Steak, for instance, has to be seared from the outside, so when it’s reheated on board, it’s just right. Sushi has to either be grilled or pickled or smoked. Nothing is raw. Oysters have to be cooked, following hygiene regulations.” Certain dishes can be a challenge. “Not impossible, but difficult,” Freidanck says. Dim sum, like pasta, does not reheat very well. The texture of risotto can be less appealing when overdone.

    The dishes are cooked in the kitchen, then kept in the chiller below 10 degrees so no bacteria can thrive, until it goes on board. The dishes are deconstructed and put into different containers. On board, it goes in the oven where the heat is calibrated to a certain temperature. “There is a training center in Singapore where the crew learn to do this. It’s very specific. There’s a lot of details which they have to go through,” Freidanck says. The crew gets a plating guide, which they must follow when they assemble the dishes.  First Class passengers get their meals served on real plates with fine cutlery.

    “Complementing Singapore Airline’s World Gourmet Cuisine is a selection of the finest wines from the very best vineyards, selected by some of the world’s most educated and sought-after palates. These wines are handpicked by world-renowned wine experts and blind-tasted under simulated cabin pressure, since our taste buds are affected by the cabin pressure,” notes Carol Ong, Singapore Airlines general manager for the Philippines, Guam and USTT. The Singapore Airlines Wine consultants include three Masters of Wine: Michael Hill-Smith, Jeannie Cho-Lee, and Oz Clarke.

    “So, you have just flown First Class, basically,” Freidanck says, addressing the intimate media group of happy diners at the end of the meal. The only thing missing was the altitude.

  • Jollibee profit soars as Filipinos order more

    Jollibee profit soars as Filipinos order more

    Jollibee Foods has reported  13.8 per cent global sales growth in its nine-month net profit as sales soared to P4.39 billion (US$88.2 million).

    Most of the Jollibee profit growth came from the domestic market where sales rose 16 per cent year-on-year, with the expanding offshore business returning 6.4 per cent growth.

    During the third quarter, net profit rose 6.1 per cent to P1.33 billion.

    “Sales of our businesses continued to be strong. We expect to end the year 2016 with the highest system-wide sales growth in five years and the highest organic growth in at least a decade driven by strong same store sales growth and the highest store network expansion,” said Jollibee CEO Ernesto Tanmantiong in an earnings statement.

    Jollibee, Asia’s largest food company, grew systemwide sales in the third quarter by 12.4 per cent to P36.32 billion, taking nine-month sales to P107.76 billion or 14.1 per cent higher.

    On a global basis, sales from the same-store network grew by 6 per cent year-on-year while new stores contributed a growth of 6.4 per cent.

    Tanmantiong said the company was encouraged by improvements in China, which helped its international business return to growth.

    “We look forward to continued recovery of our China business in the months ahead with the introduction of new products. Our plans for 2017 and the years ahead call for continued strong same store sales growth and store network expansion in the Philippines and abroad with the aim of surpassing our historical performance,” he said.

    JFC opened 201 new stores between January and September – 133 in the Philippines and 68 abroad. That’s a higher number than for the whole of 2015, when 186 opened.

    Jollibee’s CFO Ysmael Baysa said gross profit margins on the company’s products improved in the third quarter as raw material prices stabilised.

    At the end of September Jollibee had 3221 stores worldwide, 2547 of them in the Philippines. It also has a stake in Highlands Coffee in Vietnam and the Philippines, Pho 24 in Vietnam, Indonesia, Cambodia, Korea and Australia, Hotpot in China Smashburger in the US.

  • BreadTalk to take Din Tai Fung into UK

    BreadTalk to take Din Tai Fung into UK

    BreadTalk Group has signed a franchise agreement with the parent of the Din Tai Fung brand of restaurants to take the Taiwanese concept into the UK.

    BreadTalk Group says the deal with Fairy Rise Development, the owner of Din Tai Fung, will see the first restaurant opened in London next year, followed by outlets in England, Ireland and Northern Ireland.  They will be run by a joint venture company TFUK, comprising BreadTalk subsidiary Together Inc as majority shareholder, Din Tai Fung Taiwan, Fairy Rise, a UK partner and Taiwanese investors.

    Cheng William, divisional CEO (restaurant) of BreadTalk Group says the deal will see the concept enter Europe for the first time.

    “With our experience in operating the brand for the last 13 years in both Singapore and Thailand, we hope to bring the much loved Din Tai Fung to new consumers who will appreciate this authentic Taiwanese cuisine,” he said.

    Din Tai Fung’s owner,  Chi-Hwa Yang, says the international recognition Din Tai Fung enjoys today “is in no small part attributable to our long-standing partnership with the BreadTalk Group. BreadTalk Group has played an integral role in our success by growing and exposing our Taiwanese brand to an international audience.”

    BreadTalk Group operates 21 Din Tai Fung restaurants in Singapore and three restaurants in Thailand with more planned.

    Globally, Din Tai Fung’s stores have won multiple awards, including a Michelin star in Hong Kong, and are favoured by celebrities and food critics alike with a total of 135 restaurants in 13 territories.

    BreadTalk Group won the franchise rights to operate Din Tai Fung in Singapore and Thailand, in 2003 and 2011 respectively. The Taiwanese brand also has branches in Australia, China, Hong Kong, Indonesia, Japan, Malaysia, the Philippines, South Korea, the UAE and the US.

    BreadTalk Group has nearly 1000 stores spread across 17 markets, its brand portfolio comprises BreadTalk, Toast Box, Food Republic, Din Tai Fung, Thye Moh Chan, Bread Society, The Icing Room and RamenPlay.

    BreadTalk Group has a network of owned bakery outlets in Singapore, China, Malaysia, Hong Kong, and Thailand, as well as franchised bakery outlets across Asia and the Middle East. It also owns the Food Republic food atria in Singapore, China, Taiwan, Hong Kong, and Malaysia.

  • Smith & Wollensky restaurants going global

    Smith & Wollensky restaurants going global

    US steakhouse Smith & Wollensky, famously described by the New York Times as “the steakhouse to end all arguments”, is expanding its global presence, setting its sights initially on such cities as Bangkok, Hong Kong, Seoul, Singapore, Taipei and Tokyo, as well as Dubai and Mexico City.

    This follows Irish investment company Danu Partners acquiring Smith & Wollensky Restaurant Group (SWRG) from Bunker Hill Capital this year. Its first overseas restaurant was opened in London.

    “Our teams in the US and London have worked closely together to build a robust infrastructure, and this is a perfect platform on which to build a global business,” says Leonard Ryan of Danu Partners. Joining the team will be international development executive Oliver Munday, who in the past 20 years has worked at growing US restaurant brands internationally.

    “Having completed transactions in more than 30 countries with multiple restaurant brands including Hard Rock, Margaritaville and Planet Hollywood, Oliver brings the contacts and expertise needed to allow us to reach our full potential on the international stage,” says SWRG president/CEO Michael Feighery .

    “Smith & Wollensky occupies a special place among the great US fine-dining restaurant brands, and there is global demand for such a classic American steakhouse experience,” says Munday. “We will be entertaining only a handful of select markets … but interest is already strong.”

    Since Danu Partners bought Smith & Wollensky it has embarked upon a program of reinvestment, which as well as expansion includes upgrades of its restaurants in the US.

    Established in 1977 with its headquarters in Boston, Smith & Wollensky Restaurant Group has seven locations in the US. The restaurant has received such accolades as the Grand Award of Excellence from Wine Spectator and an Award of Excellence from Distinguished Restaurants of North America.

    An investment holding company based in Dublin, Danu Investment Partners was founded in 2009 and covers a range of business sectors, with a focus on the hospitality sector.

  • Promotion, collaboration sought to boost tea exports

    Promotion, collaboration sought to boost tea exports

    The government should give more attention to Indonesia’s tea industry by intensifying promotional efforts and strengthening collaboration among ministries to reverse the trend of declining exports that started a few years ago, a public policy expert suggests.

    “The Trade Ministry, for example, can collaborate with Pak Arief Yahya [the tourism minister]. So while traveling overseas, they could promote Indonesian teas,” University of Indonesia’s public policy lecturer Riant Nugroho said on Monday.

    The declining tea exports, which was partly caused by there being limited land for tea plantations, could also be solved through better coordination with the Public Works and Public Housing (PUPR) Ministry, he added.

    “Talk to them and find out ways so they won’t use all the available area to build [the planned] Jakarta-Bandung high-speed railway, for example,” he said, referring to the megaproject designed to better connect Jakarta and the capital of West Java, Indonesia’s largest tea-producing region.

    Ranked as the seventh largest tea producer in the world, Indonesia’s tea exports dropped to 62,700 tons last year from 92,000 in 2009, with the value going down to US$128 million from $171 million in the same period.

    Only 6 percent of the 62,700 tons exported last year comprised value-added processed tea.

    “Tea production in the country still faces a lot of challenges, such as the limited area for plantations, outdated machinery and low tea prices at the farm level,” said the Trade Ministry’s director general for foreign trade, Dody Edward.

    Among the largest of Indonesia’s tea export destinations are Russia, Malaysia, Pakistan, Australia and Germany.

  • Nutmeg higher in demand in Europe

    Nutmeg higher in demand in Europe

    Exports of nutmeg from Indonesia to Italy has increased toward the end of the year, a North Sulawesi official said.

    “Orders have come more regularly from Italy for North Sulawesi nutmeg. Demand is growing toward the end of the year,” head of the provincial industry and trade office Jenny Karouw said here on Tuesday.

    Jenny said in the third week of November 2016 nutmeg exports to Italy totaled 15 tons worth US$112,500.

    She said nutmeg from the district of Sitaro Islands is high in demand in Europe especially in Italy for its high quality.

    “The quality of nutmeg from the district of Sitaro Islands has been internationally recognized. The exporters, therefore, should maintain the reputation,” she said.

    Buyers from Europe would look for other suppliers once they found the quality is not up yo their expectation, she added.

    Nutmeg from North Sulawesi has been exported to Europe and the United States, where quality is the priority.

  • Cash Crunch Chokes off India Palm Oil Imports From Indonesia & Malaysia

    Cash Crunch Chokes off India Palm Oil Imports From Indonesia & Malaysia

    India’s palm oil imports are expected to slip next month by up to a fifth, including from the top two producers Indonesia and Malaysia, as New Delhi’s removal of high-value rupee notes from circulation disrupts distribution systems and curbs demand.

    Traders in Malaysia, India’s largest palm oil supplier taking up half of its imports last year, say the absence of the large bills has already impacted sales. Indian buyers are delaying shipments and cancelling vessel space bookings, and the traders expect them to hold back further in the month ahead.

    In India – top importer of vegetable oils – traders are forecasting up to a 20 percent drop in crude and refined palm oil imports for December from the previous month, with edible oil refiners reducing purchases as the cash crunch weakens retail demand.

    Having fewer high-value notes in circulation is also hampering distribution because village shops typically pay local wholesale dealers in cash.

    “Bulk buyers are not ready to lift stocks. Most of November shipments we cannot cancel or postpone as tankers have already left Indonesian and Malaysian ports. So we are postponing shipments in December to January,” said a senior official with an Indian oil refiner who declined to be named.

    Cargo surveyor data shows Malaysian palm oil shipments to India for the first half of November have already dropped by 81 percent to 85 percent versus the corresponding period last month.

    “Inquiries have fizzled out since last week,” said a Kuala Lumpur-based trader, who reported an over 50 percent decline in sales volumes. “It’s not going to be easy now for the market to sustain high price levels.”

    Benchmark palm oil prices have been volatile in recent trading sessions, hitting a four-year high a week ago and then posting its biggest intraday drop in more than four months in the next session.

    Palm oil looks set to fall more than 3 percent this week, down about 0.2 percent on Friday around 2,870 ringgit per tonne.

    Purchases from top consumers India and China typically fall-off at year-end because palm oil solidifies during the Northern Hemisphere winter, but this year the numbers are being hit hard.

    India’s total palm oil imports stood at 739,159 metric tons, according to traders, and are expected to fall to 650,000 metric tons in November and by another 20 percent from there in December.

    Total palm oil imports in December 2015 were 790,368 metric tons, according to the Solvent Extractors Association of India (SEA).

    No cash in a cash market

    Exact numbers aren’t available from largest producer Indonesia, but analysts there also expect lower shipments to India because of the cash shortage, while Indian buyers said they have cut vegetable oil imports from all suppliers, even for soyoil from Brazil and Argentina in December.

    Last week, Indian Prime Minister Narendra Modi declared 500 rupee and 1,000 rupee bills no longer legal tender to crack down on corruption and bring unaccounted wealth back into the economy, leaving millions with insufficient cash.

    “Retail sales are going down as many people don’t have cash to buy essential commodities. Refiners are not able to dispose their stocks, so they are likely to cut imports in the short-term,” said B.V. Mehta, executive director of SEA.

    Still, while India cannot do without imports due to limited local supplies, it is not clear how long the slowdown will last.

    Jitendra Kadam, a grocery shop owner from India’s western state of Maharashtra, said consumers have cut down purchases of everything from sugar to edible oils.

    “Until they get notes of smaller denominations, demand will remain weak,” he said.

    Said a Malaysian trader: “Everything is at a standstill. There is not enough cash around, so people are not going to trade much. They are going to wait and see.”

  • Singapore amongst 20 most expensive cities for coffee

    Singapore amongst 20 most expensive cities for coffee

    Online office supply company Service Partner ONE have released the 2016 Coffee Price Index, detailing which cities offer the best value coffee worldwide. The research, which took into account 75 cities from 36 countries across the globe, found that Rio de Janeiro, Brazil offers the least expensive average coffee price, whilst Zurich, Switzerland was the most expensive city researched.

    To create the ranking, the research team averaged the cost of four separate types of coffee: a cup of coffee in an office, a Grande Latte from Starbucks, a medium cappuccino from an independent coffee shop, and a cup of coffee at home. The research looks into costs of coffee from various sources, not just high street outlets, in order to get a clearer picture of the overall value of coffee in each city.

    Singapore is ranked 20th most expensive city for coffee with coffee priced at $2.33(S$3.30) per cup. This compares to Zurich which came in as the most expensive city overall, at an average of $3.52 (S$5), and Rio de Janeiro where coffee was the most affordable, with an average of $1.02 ($1.44).

    In Asian ranking, Hong Kong emerged as the priciest city for coffee. It is ranked 6th in the global ranking with coffee costing $2.88 (S$4.08) per cup.

  • Aldi poised to sell wine in China

    Aldi poised to sell wine in China

    The discounter has been rumoured to be mulling a launch in mainline China since 2014, when it was reported by the Guardian, however a report in German trade publication Lebensmittel Zeitung announcing the online-only move last week has been confirmed to the Australian media by Aldi.

    The Aldi spokesman said the discounter had been researching the market and undertaking feasibility studies for several years and was now ready to launch an e-commerce site in mainland China during the early part of 2017.

    “In the second quarter of 2017, Aldi will commence selling a carefully selected range of everyday grocery items to Chinese consumers,” a spokesman was reported as saying.

    The statement noted that Aldi had enjoyed a strong and long lasting relationships with many of its Australian suppliers since its first stores opened in 2001 and the Australian business had grown rapidly and would benefit from continued investment to expand. “Our growth across the country has provided increased business for these suppliers, allowing them to invest this back into their own operations and contributing to their success. We look forward to further expanding these relationships as we develop further opportunities in Asia,” it said. “We know there is a strong demand among Chinese consumers for Australian manufactured products and our goal is to provide a competitively priced alternative for shoppers seeking quality groceries. We believe our unique offer of high-quality Australian products at unbeatable prices will be an attractive proposition for Chinese consumers.”

    The move will use Aldi’s Australian retail business to supply China, and will concentrate on wine, and ambient groceries.

    There is huge demand for wine in China, and Australia has enjoyed a boom in sales to Chinese consumers. Last year, China overtook the US as Australia’s most valuable market, rising 51% to AUS$474 million during 2015, while last month, the China Association for Imports & Export of Wines & Spirits released figures showing the country imported more than 354 million litres of wines between January and September 2016 – an increase of 19.06% on the same period last year.

    Aldi launched its first UK e-commerce operation in January this year focusing on wine sales, and sold more 3,000 cases on its first day. The team said the it had continued to be  extremely popular, growing sales in key areas of the South of the UK and London, where there are currently fewer stores.

  • Duck-Snack Maker Flounders with Weak IPO Pricing

    Duck-Snack Maker Flounders with Weak IPO Pricing

    One of the year’s quirkier IPOs had its wings clipped after investors’ appetites failed to take off for one of China’s leading makers of popular snack foods made from duck parts.

    After making a splash with its original listing announcement, Zhou Hei Ya International Holdings Co. Ltd. couldn’t impress investors even with a growth story that includes annual profit and revenue growth of more than 40% annually between 2013 and 2015.

    The offering in Hong Kong was ultimately priced at HK$5.88 (76 U.S. cents) per share, or near the bottom of its previously announced range of HK$5.80 to HK$7.80.

    Hong Kong retail investors, who normally flock to IPOs for famous brands, gave the offering an especially cold shoulder. Of the 42.4 million shares available for those mom-and-pop buyers, representing 10% of the total offering, only 81% were actually sold.

    That forced Zhou Hei Ya, whose name means “Zhou Family Black Duck,” to sell about 8 million orphaned shares from that portion of the allotment to institutional investors instead. Zhou Hei Ya raised HK$2.37 billion from the offering, far short of its original target of up to HK$3.3 billion.

    A big name in the domestic snack-food market, Zhou Hei Ya hopes to use the funds to expand internationally. Started in 2002 as a family-run snack stall in the interior city of Wuhan, Hubei province, the company’s products are now sold in 750 retail stores across 40 Chinese cities. In addition to its namesake duck necks, its products also include local delicacies like duck feet, braised peanuts and duck tongue.

    Braised snacks have a long history in China, where they are commonly sold at roadside stalls. But they are increasingly being marketed by major snack brands. Meat, tofu and other ingredients are simmered for hours in a rich savory broth, and many regions have their own special seasoning blends.