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Taiwan's Baking Sector Looks to Rebuild Consumer Confidence

After a string of scandals in 2014, Taiwan's bakery industry has high hopes of promoting better quality products.

Photo: Record turnout at Taipei Bakery Show. (Xinhua News Agency)
Record turnout at Taipei Bakery Show.
Photo: Record turnout at Taipei Bakery Show. (Xinhua News Agency)
Record turnout at Taipei Bakery Show.

Last year, Taiwan's baking industry was rocked by a series of food safety scandals. One positive consequence of this, however, has been the official imposition of a more stringent level of monitoring, with the government, the media and consumers themselves all having a role to play in promoting better food standards. It is hoped that, ultimately, this greater awareness of food issues will make consumers more willing to make purchases based on quality, rather than simply being lured by low prices.

Commenting on the 2014 crises, Alfred Chen, Chairman of the Namchow Group, one of Taiwan's leading bakery businesses, called on the industry to move on from last year's problems. He believes the scandals will be seen as a turning point for the sector, putting real quality on the agenda for both consumers and producers.

Previously, he says, consumers were solely price-fixated, while manufacturers were only concerned about sourcing low cost ingredients. The 2014 food scandals, however, have forced both parties to reassess. Consumers now accept that, if they want quality, they may have to pay a premium to secure it.

With this new focus on the sector, this year's Taipei International Bakery Show (TIBS), held on 26-29 March, attracted 1,200 exhibitors, a record for the event. There was also a distinct boost to visitor numbers, with some 140,000 making their way to the Nangang Exhibition Hall during the course of the four-day show.

As ever, the event focussed on innovative baking technology from around the world, while also providing a forum for global raw material suppliers to promote themselves to Taiwanese businesses. This year's strong turnout was seen as underlining the renewed confidence in the sector.

Lo Chih-Hsien, President of the Uni-President Group, a Taipei-headquartered food-manufacturing group, was also optimistic about the prospects for the baking sector. In fact, such is his assurance that his company has just launched a new division of its bakery business.

The reshuffle and rethink in the sector has also encouraged a number of new entrants, with many of them making a first-time foray into baking from other business areas. Among these new arrivals are XPEC Entertainment (which bought E-G-Sain) and GenMont Biotech (which acquired more than 50% of the shares in White Wood House). HESS Bookstores, Formosa Eyewear, and Nan Ren Hu, a leisure services operator, have also launched baking businesses, albeit with low-key start-ups.

It is estimated that Taiwan's bakery market is worth about NT$60 billion (US$1.93 billion) per annum, with 2% to 3% growth expected this year.

Table: Cross-sector Investments in Taiwan′s Baking Industry
Table: Cross-sector Investments in Taiwan′s Baking Industry

Francess Lin, Taiwan Office

Content provided by Picture: HKTDC Research
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