In­stant nour­ish­ers gain strength

China Daily (Latin America Weekly) - - 13 Business - By WANG ZHUOQIONG wangzhuo­qiong@ chi­

China’s in­stant food mar­ket, where noo­dles and frozen food reigned supreme once upon a time but fell upon bad times due to the rise of food de­liv­ery firms, is not only re­cov­er­ing but set to grow rapidly again.

Mak­ing that hap­pen is a com­bi­na­tion of new pric­ing strate­gies, novel fla­vors, ris­ing health con­scious­ness among con­sumers and tech­no­log­i­cal in­no­va­tions in the in­dus­try.

The first signs of re­cov­ery in five years came from UniPres­i­dent China Hold­ings Ltd’s fi­nan­cial re­port for the first half of this year.

The in­stant noo­dles busi­ness of the group recorded a healthy rev­enue of 395.4 mil­lion yuan ($59.9 mil­lion). Al­though down 1.4 per­cent year-on-year, the fourth con­sec­u­tive such drop, its key brand Soup Daren grew rapidly.

The group con­tin­ued to lead the mar­ket seg­ment in which prod­ucts are sold at 5 yuan and above. It fur­ther op­ti­mized its prod­uct struc­ture, which marked a big step to­ward in­dus­try up­grad­ing.

In re­cent years, the emer­gence of food de­liv­ery ser­vices, avail­abil­ity of ex­press trains and con­sump­tion up­grade had im­peded the growth of the in­stant noo­dles seg­ment.

Jason Yu, gen­eral man­ager of Kan­tar World­panel China, a mar­ket re­search firm, said the seg­ment grew by 1.2 per­cent last year, while the firsthalf growth this year was 4.9 per­cent. “The re­bound is ob­vi­ous, prompted by the high-end prod­ucts.”

How­ever, ac­cord­ing to the In­stant Noo­dles Re­port of Min­tel Group Ltd re­leased in Jan­uary, the seg­ment in China has con­tin­ued to shrink, de­clin­ing by 1.3 per­cent dur­ing 2014-16, as con­sumers be­came more and more health-con­scious.

The de­clin­ing work­ing-age pop­u­la­tion and mi­grants, who used to be heavy buy­ers of in­stant noo­dles, also hurt over the last few years.

This has had a par­tic­u­larly ad­verse im­pact on Mas­ter Kong, a com­pany that com­mands more than half of the mar­ket share.

In 2016, Mas­ter Kong’s in­stant noo­dle unit earned a rev­enue of $3.2 billion, down 25 per­cent from that of 2013. Mas­ter Kong’s net profit in the first quar­ter of this year has seen slight growth, but

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