Asia Pacific is the largest region globally for rice, pasta and noodles. This is driven by traditional preferences and consumers trading up from unpackaged to packaged rice, as well as active innovations to localise flavours and nutritional positionings of noodles and pasta to the latest consumer demands. Future growth will come from trading up to packaged rice in more developing countries, as well as premiumisation in noodles to evolving consumer tastes.
While demand for rice is slowing in more developed markets such as South Korea and Japan, developing markets such as Indonesia, India and Vietnam are driving overall growth in Asia Pacific. Economic growth gives them the means to afford more expensive rice with verifiable food safety standards, while population growth continues to boost basic volume demand. Combined, this is a strong boost for overall value sales growth.
At the other end of the spectrum, consumers in more developed markets are looking for greater convenience and functionality in addition to basic satiety. There are more convenient alternatives such as meals delivered from consumer foodservice, and instant rice options amidst faster paced lifestyles. With “low-carb” diets gaining ground, consumers have close substitutes such as oats, millet, quinoa and sweet potatoes to choose from. Consumers are willing to pay a higher price for additional nutritional benefits, as grains such as oats are beneficial for digestion and heart health in addition to being very filling.
Multinational instant noodle players such as Nissin, Indofood and Nong Shim focused on product innovation to localise their flavours. More exotic premium variants were also introduced to each market to add dynamism and drive value sales. This was backed up by strong marketing and promotional efforts, which translated into share growth from 2014 to 2019 at the expense of other instant noodle players.
As consumers acquire greater means in Indonesia, India and Vietnam, trading up from unpackaged to higher quality packaged rice is expected to become more mainstream. Within China, healthier innovations for plain and instant noodles are expected to drive growth in the face of convenient food delivery alternatives.
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