Far East digest

McDonald’s registers first growth after 19-month slump

By RJ Whitehead

- Last updated on GMT

McDonald’s registers first growth after 19-month slump

Related tags: Food, Nutrition

McDonald’s Japan has registered its first sales increase after a year and a half in the doldrums.

The company has endured poor performance over the last 19 months after it was found to have sold expired meat sourced from a Chinese processor at the centre of a scandal last July.

This was followed by a series of stories about poor quality and standards, including the alleged finding of a human tooth found in one of its products.

Now buoyed by positive figures from August, the company says it will continue to improve its product and service offering for customers.

McDonald’s Japan saw a 2.7% year-on-year increase in sales during August amid an 5.7% increase in overall fast food sales in the country.

In the first six months of this year, the Japanese wing of the fast-food major reported sizeable losses, with sales falling 29.5% to to JPY85.2bn (US$71m) compared to JPY121bn for the same period last year. It registered a JPY26.2bn net loss between January and June, which was partly blamed on a series of concerns about quality.

In April, the company announced it would renovate 2,000 of its 3,000 Japanese outlets and shut down another 130, while reducing its headcount in a bid to cut costs.

AAK enters Japan market through joint-venture

AAK will partner Miyoshi Oils & Fats through a new Japanese joint-venture, AAK Niyoshi to extend its business in the country in the bakery, dairy, infant nutrition, and chocolate and confectionery fats segments.

AAK will own 70% of the business, which will be based in Tokyo with sales and customer innovations divisions. Miyoshi will manufacture the company's products locally when the partnership begins in January 2016.

With global customers and regional leaders, Japan is obviously a very attractive market to be present in for AAK​,” said Torben Friis Lange, AAK’s regional president.

Miyoshi is a very good match in size, location, technology and culture, and has very well-developed relations with many important local customers. Together, we will continue to develop customer relations as well as the portfolio of speciality and semi-speciality products​.”

Miyoshi was established in 1921 and has traditionally worked in the bakery market. The company, which had an annual revenue of approximately US$360m last year, has  factories in Tokyo and Osaka. 

I have visited AAK many times over the last 40 years and it is with great pleasure we welcome this partnership​,” said Katsuyoshi Miki,  Niyoshi’s head. 

AAK is currently constructing a speciality and semi-speciality edible oils factory in Zhangjiagang, China, which will be operational by the end of the second quarter of 2016. The Swedish edible oils major recently acquired 51% of a leading Indian oils and fats company, creating AAK Kamani in Mumbai.

Morinaga's BB536 probiotic now 100% gluten free

Japan’s second-largest company in the dairy segment, Morinaga, has completely eliminated gluten from its flagship product, the probiotic strain Bifidobacterium longum​ Morinaga BB536. 

A human residential bifidobacteria developed by Morinaga with numerous benefits for human health, BB536 first appeared on the market over 30 years ago. 

More than 50 human studies show that BB536 provides a natural defence against episodic digestive and abdominal discomforts, including constipation, diarrhoea, gas, and bloating. It also improves the ratio of beneficial to harmful bacteria in the body and decreases ammonia and putrefactive products in the digestive tract. 

The ingredient is manufactured through a culturing method that gives it excellent stability to be used in a wide range of applications, including supplements and functional foods, and in a variety of delivery forms, including capsules, sachets, oils, tablets, powders, chocolates, protein powders, and infant formulas. 

We are pleased to be able to offer a new, completely gluten-free formulation of this classic probiotic to the marketplace, which will further enhance its value to even the most demanding consumers​,” said Morinaga’s Ko Shiino.  

Manufacturing BB536 without gluten is one in a series of improvements Morinaga has undertaken over the past three decades to make the ingredient as market-friendly as possible. 

We continually strive to add value to our flagship probiotic strain, whether that’s investing in new clinical research, achieving GRAS certification, or addressing the evolving needs of our consumers, which is our utmost priority​,” Shiino added. 

Taiwan must transform food export segment

Taiwan must broaden its food research and development if it is to increase exports and transform into a regional hub, according to a senior business official. 

The food industry was worth more than NT$654bn (US$20bn) in 2014, but there is still room for growth said Wu Ming-ji, director-general of the Ministry of Economic Affairs' Industrial Development Bureau, especially in exports.

Nearly all of locally manufactured food is consumed in Taiwan, with just 10% exported, Wu said. To increase this figure, he urged manufacturers increase their focus on technological innovation.

The economic ministry is currently pushing ways to strengthen Taiwan’s competitiveness by adding value to food products and expanding food exports. It hopes by doing so it will achieve a target production value of NT$823bn by 2020, with NT$111.5bn coming from exports, Wu said.

Aiming to turn the country into an Asia-Pacific food hub, the ministry hopes this figure will increase to NT$920bn by 2025, with food exports accounting for NT$144bn, he added. 

India’s Ruchi forms Japanese JV for soybean germ oil distribution

Ruchi Soya Industries of India will launch a soybean germ oil in partnership with Japanese edible oil major J-Oil Mills and distributor Toyota Tsusho Corporation.

"Soybean germ oil, the healthiest form of edible oils, will be launched by next year. The oil is being manufactured with the help of J-Oil Mills and TTC​," Ruchi executive Nilesh Mazumdar said of the cholesterol-free oil.

Ruchi has a 51% stake in the joint-venture, with J-Oil (26%) and TTC (23%) owning the remainder.

Ruchi will provide the raw material and lead the distribution effort, while J-Oil will focus on technical assistance, and TC will access international markets through its network.

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