Growing appetite in regional bakery market

HAVING a halal certification is one of the most sought after recognitions among food players with global ambition. And Malaysia, being a renowned halal food manufacturing hub, has seen various global food players making a beeline to set up their bases here.

The interest in the local market is also, in part, due to Malaysia’s strategic gateway to the South-East Asian market. With a sizeable population and rising living standards, the Asean region is marked as one of the major growth drivers for the bread and baked food market.

This, in turn, increases demand for the baking ingredients market.

The positive development in the industry can be seen through the gradual reduction of import tax on baking products in the Asean region.

While this is good news to baking ingredients manufacturers and suppliers, Harvest Bakery Ingredients export manager Lim Teck Hwa notes that consumers in this region have a diverse taste portfolio and preferences. For Lim, this presents both opportunities and challenges.

As it stands, there are already a number of large European-based companies that have started or are in the process of starting their manufacturing operations in Malaysia. Some of Harvest Bakery’s notable foreign competitors with base in the country include AB Mauri and Bakels.

Most local manufacturers are also active in the regional confectionery market. They offer good distribution expertise and local connections.

In Malaysia, the bulk of the bakery ingredients manufacturers and suppliers are located in the Klang Valley, Melaka and Johor. They are well equipped with modern technology to apply the latest methods, save costs and improve productivity.

Innovation by producers also play a great role in ensuring new products drive market growth. The improved transportation and logistics also help in expanding the business network to achieve greater market penetration.

Rather than compete head on with the international brands, which have much bigger scale and capital, that have set up shop locally, Lim says Harvest Bakery prefers to grow their market in the international arena. After all, there is more value in knowing that your products are acknowledged in the other parts of the region than just at home.