Malaysia’s rich cultural mix and industrial strength have resulted in a vibrant food and beverage sector that often surprises foreign buyers in terms of its range of products and sophisticated production capabilities.
Currently, the Malaysian food-processing sector accounts for about 10 percent of Malaysia’s manufacturing output, exporting to more than 200 countries with an annual export value of €3.4 billion in 2013, an increasement of 6.9%. The Malaysian F&B sector exported €167 million worth of processed food to the EU. The main export products were cocoa and cocoa preparations, prepared cereals and flour preparations as well as and margarine and shortening.
Malaysia also has strong capabilities in terms of OEM production for European private labels seeking to outsource some of their production activities. Apart from that, Malaysia also continues to be a net importer of processed food products, with an annual import of more than €3.6 billion. This essentially means that there are ample opportunities for investment for European companies seeking to expand their market share in Malaysia, as well as via Malaysia to other parts of Asia.
A total of 80 projects (food processing and beverages), with investments of €608 million, were approved in Malaysia in 2010. The approved projects were for flour and flour-based products, processed meat, food ingredients, beverages, dairy products, cocoa and chocolate and confectionery products, processed seafood, and aquaculture feed and animal feed. Almost half of the investments, totalling €291 million, were released by foreign companies. Major multinational companies involved in the production of food products in Malaysia include Nestlé, Ajinomoto, Activ International, Campbell’s, Cargill, Gardenia, Haco, Kerry Ingredients, Yakult and Coca-Cola.
In order to further expand Malaysia’s share of the F&B market in Europe the Malaysian government, is leveraging its national trade promotion agency MATRADE which is represented by ten offices throughout Europe. For example, at the upcoming food fair SIAL 2014 MATRADE in Paris is organising a Malaysian Pavilion covering a huge area in hall 4. A total of 34 Malaysian exhibitors will present their products, including frozen-food items, confectioneries, sauces and pastes, beverages and food ingredients.
The pavilion is expected to draw buyers who are seeking F&B products that can serve a wide range of customers’ tastes, including those related to Asian, European and fusion cuisines. “Malaysia’s exhibitors at SIAL trade fairs have always attracted buyers keen on sourcing from reliable exporters who can deliver in a cost-competitive manner”, says Jai Shankar, MATRADE’s trade commisioner in Germany. “This year, with the improvement in prevailing market conditions in the EU and surrounding regions, we expect the overall achievement of Malaysian exhibitors to rise further.”
Apart from focusing on sales, MATRADE is also leveraging the event to highlight the strength of the Malaysian F&B sector, especially in terms of developing and marketing innovating products. According to Mr Shankar many of the Malaysian exhibitors have already made inroads into the Asian markets and are now actively promoting their products to the European markets and surrounding regions.