Opportunity for Malaysian Food as US Market for Asian Frozen Food Expands

Demand is rising markedly among US consumers

In the latest issue of Quick Frozen Foods magazine, a leading publication serving the
frozen food industry, an article touts the rapid increase in demand for frozen Asian food
among US consumers. Asian frozen ready meals, both imports and domestic, are
becoming increasingly popular. Large volumes and varieties of such fare have been
imported into the US over the past few years primarily to satisfy the appetites of Asian
immigrants in North America, but now demand for this cuisine is rising markedly among
non-Asian consumers.

Recent research by the Mintel International Group concluded that ethnic food sales will
have reached a record US$2.2 billion during 2010 in the United States, and advance by
another 20% between 2010 and 2014. The major growth drivers in the category are
East Asian and South Asian foods, which showed 35% and 11% growth rates,
respectively, between 2006 and 2008.

In 2009, sales of frozen Asian entrees in the US topped US$815 million at the retail
level up 8.6% over the previous year. That is more than double the US$361 million
that Asian frozen food entrees and dinners combined rang up in 1999. Another survey
by Mintel, in which 1,500 adult frozen food users were interviewed, revealed that
Chinese dishes are the third most consumed type of frozen cuisine in the US. Other
industry research reports that 40% of US households buy frozen Asian entrees at retail
stores on a regular basis.

The trade magazine Advertising Age recently pointed out that the two largest segments
of the US Asian community, Chinese and South Asians, have populations that are
larger than several European countries.

With more than 15 million consumers, whose population will escalate to more than 30
million in less than a few decades, the spending clout of Asian-Americans rivals the
GDP of more than a dozen European states and leading economies around the world,
it reported. For a population that represents only about five percent of the US, by 2014
Asian-American consumers will have more than $700 billion in spending power up
from $509 billion in 2009.

As of November 2010, Malaysian exports of processed food to the US increased by
24.91% to US$535.13 million compared to last year. That exceeds the 13.92% increase
in overall US imports of processed food products. With MATRADEs efforts, the
continuation of the Malaysia Kitchen for the World program and the expanding Asian
food market in the US, these numbers should continue to increase in the next couple of
years.

United States Import Statistics
UDG: Processed Food - MITI Definition
Year To Date: January - November
Rank
Partner
Country
Thousands United States Dollars % Share
%
Change
2008 2009 2010 2008 2009 2010 2010/2009
World 55,588,920 52,941,413 60,309,435

100.00

100.00

100.00 13.92
1 Canada 11,937,757 10,925,933 12,229,171 21.48 20.64 20.28 11.93
2 Mexico 8,128,029 8,574,935 10,220,621 14.62 16.20 16.95 19.19
3 China 4,320,796 3,714,873 4,294,922 7.77 7.02 7.12 15.61
4 Thailand 2,526,169 2,529,607 2,852,014 4.54 4.78 4.73 12.75
5 Brazil 1,974,609 1,814,716 2,165,239 3.55 3.43 3.59 19.32
6 Chile 2,342,622 2,154,798 2,140,541 4.21 4.07 3.55 - 0.66
7 Indonesia 1,708,545 1,561,327 1,791,912 3.07 2.95 2.97 14.77
8 Vietnam 1,357,528 1,226,209 1,574,510 2.44 2.32 2.61 28.40
9 Australia 1,415,198 1,467,357 1,471,801 2.55 2.77 2.44 0.30
10 Colombia 1,115,227 1,104,769 1,239,604 2.01 2.09 2.06 12.20
23 Malaysia 519,926 428,422 535,134 0.94 0.81 0.89 24.91

Malaysian exporters should take advantage of the positive outlook of the US ethnic food
market by targeting aggressively at the market. The most effective promotion is market
visits with pre-arranged meetings, besides participation in food trade shows. Products
must conform to the US standards in terms of approved ingredients, nutritional labeling
and packaging material. Malaysian food manufacturers should also become familiar
with the recently passed Food Safety Modernization Act
(http://www.gpo.gov/fdsys/pkg/BILLS-111s510es/pdf/BILLS-111s510es.pdf) which was
introduced to strengthen food safety is the US. In addition to the existing requirements
for registration of facility and prior notice of shipment, foreign food manufacturers may
be required to provide third-party certifications and documentations of products. In this
respect, exporters are advised to work closely with importers as importers are equally
accountable for the food products they import into the US.

___________________
MATRADE NEW YORK
2011