Food market remains a mixed bag for investors

Tag : Food And Drink
Taiwan Food and Drink Report2008 provides independent forecasts andcompetitive intelligence on Taiwan's food and drink industry.

Investment activity in Taiwan's food and drink sector throughout2007 confirms that the market remains a mixed bag for investors.High consumer spending levels, driven by sound economicfundamentals and illustrated in a per capita food consumption levelof US$1,992 in 2007, are highly attractive to investors. Foodconsumption growth is also appealing; to 2012, BMI is forecastingfood consumption growth in per capita terms of 16.4% in Taiwan.Nonetheless, as this report makes clear, sector dynamism is nolonger quite what it was and consequently the country's leadingfood and drink players are increasingly looking elsewhere foropportunities.

Two recent developments ably highlight this trend. In January 2008,local traditional snack food producer Want Want Holdings revealedthat it was to pursue a US$700mn initial public offering in a bidto raise funds for expansion on the Chinese mainland. The companyis confident that its combination of convenient and premium snackfoods and traditional concepts and flavours will prove popular withaspirational Chinese consumers, and it is seeking a Hong Konglisting to facilitate its move. In November 2007, a similarstrategy was pursued by leading local food processor Uni-PresidentEnterprises. The company also plans to list in Hong Kong in aneffort to raise around US$700mn to help build market share inChina's instant noodle and soft beverage industries.Uni-President's strategy is particularly pressing, with the companyeager to take advantage of the exposure that Beijing's hosting ofthe 2008 Olympics will bring. Both companies are also keen to listin Hong Kong in order to overcome legislation preventing Taiwanesefirms from investing more than 40% of their capital on themainland. The overwhelming prioritisation of China depicts Taiwanas a low opportunity market and yet this is very much not the case.Existing sales levels and future growth prospects, coupled withTaiwan's perceived low risk investment environment, have seen themarket reach third place in Asia Pacific Food & Drink BusinessEnvironment Ratings - which assess a market's investment potentialin comparison to its regional peers.

This potential has much to do with the country's thriving massgrocery retail industry. Here, international hypermarket majors,such as Carrefour and Dairy Farm, stand alongside innovativeconvenience retail majors, such as the local subsidiaries ofJapanese giants 7-Eleven and FamilyMart. As all retailers look toboost their competitiveness by offering ever-more premium andadded-value products and services, food and beverage manufacturersare given ready and widespread distribution for their brands.Taiwan's high spending levels and dynamic retail sector shouldensure that the market remains an important consideration forregional food and drink investors, even if it can no longer competewith the likes of China when it comes to long term growthprospects.

Key Topics Covered:

Executive Summary

Business Environment

Regional Food & Drink Business Environment Ratings

Table: Asia Pacific Food & Drink Business Environment Ratings -Q108

Taiwan's Food & Drink Business Environment Rating

SWOT Analysis

Mass Grocery Retail

Taiwan Mass Grocery Retail Industry SWOT

Food and Drink

Taiwan Food & Drink Industry SWOT

Macroeconomic Outlook

Table: Economic Activity

Retail

Regional Overview: Declining Role Of Independent Retail In AsiaPacific

Table: MGR Versus Independent/Traditional Retailers In SelectedAsia Pacific Markets, 2006 (store numbers)

Table: MGR versus Independent/Traditional Retailers In SelectedAsia Pacific Markets, 2006 (sales, US$mn)

Industry Forecast Scenario

Table: Taiwan Retail Indicators - Sales Value by Format (US$bn) -Historical Data & Forecasts

Table: Sales Breakdown by Retail Format Type - 2006

Industry Developments

Market Overview

Structure of Taiwan's Mass Grocery Retail Market by EstimatedNumber of Outlets

Table: Structure of Taiwan's Mass Grocery Retail - Sales Value byFormat (US$bn)

Table: Average Sales per Outlet by Format - 2007

Food and Drink

Food Regional Overview: Confectionery in the Asia Pacific region

Table: Leading Global Chocolate Manufacturers

Table: Leading Confectionery Companies in the Asia Pacific Region

Drink Regional Overview: Wine In The Asia Pacific Region

Table: Australian Wine Exports To Selected Asian Markets

Table: Wine Sales In Selected Asia Pacific Markets - HistoricalData And Forecasts (mn litres)

Industry Forecast Scenario

Food

Table: Food Consumption Indicators - Historical Data &Forecasts

Table: Value/Volume Sales of Selected Food Sub-sectors - HistoricalData & Forecasts

Table: Food, Drink & Tobacco Sectoral Trade Indicators (US$mn)

Drink

Table: Taiwan Beverage Sub-sectors, Value Sales - Historical Data& Forecasts

Industry Developments

Food

Drink

Market Overview

Food

Drink

Tobacco

Industry Forecast Scenario

Table: Cigarette Value/Volume Sales - Historical Data &Forecasts

Industry Developments

Market Overview

Competitive Landscape

Key Players

Mass Grocery Retail

Key Players in Taiwan's Mass Grocery Retail Sector, 2006

Food and Drink

Key Players in Taiwan's Food & Drink Sector, 2006

Regional Company Case Studies

Food: Unilever In The Asia Pacific Region

Table: Per Capita Food Consumption in Selected Asia Pacific Markets(US$)

Drink: San Miguel Corporation In The Asia Pacific Region

Table: San Miguel Corporation In The Asia Pacific Region

Table: San Miguel Corporation Revenue And Earnings Growth ByOperating Division, Q107 (%)

Table: San Miguel Corporation - Sales By Market (US$mn)

Table: San Miguel Corporation - Key Historical Data

Mass Grocery Retail: Metro In The Asia Pacific Region

Table: Metro Group - Five-Year Financial Results

Company Analysis

Mass Grocery Retail

Taiwan FamilyMart Co

Carrefour

Food

I-Mei Foods Co Ltd

Want Want Holdings

Drink

Swire Coca-Cola Taiwan

Taiwan Tobacco & Liquor Corp - Beverage Arm

Food & Drink Ratings Appendix

Introduction: Revised Methodology

Ratings Overview

Ratings System

Indicators

Limits of Potential Returns

Risks to Realisation of Potential Returns

Weighting

Weighting

BMI Forecast Modelling

How We Generate Our Industry Forecasts

Retail Industry

Sources

BMI Forecast Modelling

How we generate our industry forecasts

Retail Industry

Sources

Companies Mentioned:

- San Miguel

- Mass Grocery Retail

- Taiwan FamilyMart Co

- Carrefour

- Food

- I-Mei Foods Co Ltd

- Want Want Holdings

- Drink

- Coca-Cola

- Mass Grocery Retail

- Taiwan FamilyMart Co

- Carrefour

For more information visithttp://www.researchandmarkets.com/research/2871c4/taiwan_food_and_dr.