For Incite’s Nada Young, flying from city to city across Asia to meet with F&B importers and distributors provides a unique perspective on local market activity and trade flows in the sector. Here’s her roundup of recent developments in the markets she works in:
Import duties on consumer goods, including meat and alcohol, were significantly increased on 23 July. Some say this move is simply a bid to protect the domestic industry, while others suggest that it's a strategic move to curb demand of imported goods ahead of a predicted rise in consumer spending, as Indonesia pulls itself out of its current slump. The good news for New Zealand exporters is that the AANZFTA protects their goods from these tariff hikes. From what I’ve seen in Jakarta and Bali, demand for imported F&B products is showing no signs of abating.
Once a thirsty market for New Zealand wine exporters, Singaporeans have moved on from the heady days of crisp Marlborough Sauvignon Blanc. Wineries not already working with a distributor in Singapore now have to work extra hard to find a reliable partner who’s willing to buck the trend that favours wines from Italy, Spain and Chile.
The implementation of the new GST bill on 1 April has provided yet another way for F&B retailers to squeeze their suppliers. Following the implementation many supermarkets announced that they would not increase their prices by adding the six percent GST, but behind the scenes they’ve told their suppliers that they would be footing the bill. Fortunately, GST has levelled the playing field in the wine sector at least. The trade in black market alcohol (commonly referred to as ‘grey channel’) has been stymied.
Business was finally starting to pick up in Thailand after last year’s military coup scared away foreign travellers and kept locals off the streets in the capital. But this week’s shocking bomb attack in central Bangkok will have dealt another crushing blow to an already fragile F&B sector.
Luxury goods consumption, including demand for fine food and wine, has slackened in Hong Kong recently. Many in the F&B sector say this is a direct result of China’s crackdown on corruption and lavish spending by government officials.
The new FTA between New Zealand and South Korea is expected to come into force by the end of 2015. Tariffs on wine and some commodity items will decrease significantly.
It’s typhoon season in Taiwan. For international business that usually means unpredictable weather and, in extreme cases, cancelled flights and disrupted vessel schedules. Currently Typhoon Goni is heading dangerously close to Taipei’s eastern coast. With winds of up to 144kph and gusts reaching 180kph, travel in and out of Taiwan is likely to be effected.
Nada Young is the Asia Market Director at Incite. Incite manages business development and sales for a clientele of international F&B exporters in high growth markets of Southeast Asia, Hong Kong, Korea and Taiwan. e. [email protected]