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25 Sep 2018 Updated 07 Jan 2019

[Opinion] How Singapore's Food Industry is Shaking Things Up

The Business Times Kee Ai Nah, Executive Director, Lifestyle & Consumer Cluster, Enterprise Singapore and Matthew Kovac, Executive Director, Food Industry Asia

A flourishing innovation climate and strategic location are doing wonders in the industry.

The food and drinks in your local supermarkets are changing - from the way they are produced to how they are packaged. With growing demand for healthier options and the heightened awareness of how non-biodegradable packaging impacts our environment, we are becoming more discerning shoppers and diners. These trends are driving the food industry to be innovative in their products and solutions.

Despite Singapore's small land mass and limited agricultural output, the local food industry is thriving. Last year alone, the food manufacturing industry contributed S$4.3 billion to Singapore's GDP, and employed over 48,000 workers. Local food exports make up more than 50 per cent of the industry's manufacturing sales. Singapore's chilli crab, chicken rice, satay, rendang and dim sum have become known around the world; indeed, the republic's hawker culture is being nominated to be added to Unesco's Representative List of the Intangible Cultural Heritage of Humanity.

The steady and encouraging growth of Singapore's food industry would not have been possible without the country's strong reputation in food safety and quality.

Many multinational food companies that produce family-favourite brands have chosen to base their Asia-Pacific headquarters and research centres here. Why so, when Singapore's 5.5 million population is one of these companies' smallest markets in the region?

One reason is a flourishing innovation climate. Singapore's strategic location in Asia, strong talent base and research and development capabilities provide food companies big and small with an ideal platform to develop and test novel technologies and products.

Innovation has become the heartbeat of the Singapore economy and part of the national rhetoric. Singapore is ranked the most innovative country in Asia, according to the latest Global Innovation Index, which considers technology, infrastructure and business sophistication, as well as the state of innovation in agriculture and food systems.

Globally, however, Singapore is still behind Switzerland, the Netherlands, Sweden and Britain. It is important that Singapore continues to cultivate an environment that allows for exchange of ideas, experimentation and collaboration. The food industry will play a key role in boosting the country's standing in innovation.

Several food producers here are already ahead of the curve. A recent study commissioned by Enterprise Singapore found that at least one-third of food manufacturers are already innovating, be it through the use of new ingredients or in developing products catering to niche sectors.

And according to the Health Promotion Board, more companies have also applied for the Healthier Development Ingredient Scheme, which provides a grant to support manufacturers in developing and promoting healthier ingredients. So far, S$7 million - one-fifth of S$35 million in funding to be disbursed over three years - has been allocated to 26 companies.

Food companies of all sizes in Singapore are seeing the business and social value in innovation. Plant-based proteins, sugar alternatives and texture-modified foods are just some of the trends gaining ground here due to growing pressures to address national health priorities and evolving consumer preferences.

One example is Alchemy Foodtech, which has created a low glycaemic index (GI) fibre that can be added to conventional carbohydrates such as rice, bread and noodles - commonplace staples in every Singaporean's meal - to lower the GI of the food product, without compromising the taste.

Life3 Biotech, a foodtech startup from the National University of Singapore, has developed a plant-based protein called Veego to offer a meat alternative that leaves minimal impact on the environment, a growing concern for eco-conscious Singaporeans.

The food industry has a tough job - to not only develop food and drinks that taste good but also provide consumers with nutritious products that are reasonably priced. This entails a careful balancing act.

Earlier this year, Food Industry Asia (FIA) - the regional association representing Asia's food and beverage industry - hosted the first "FIA Food for the Future Summit" in Singapore where regional CEOs and senior executives explored how innovation can propel the sector while addressing today's global food demands.

At the summit, FoodInnovate, a multi-agency initiative led by Enterprise Singapore, was launched to catalyse knowledge exchange, encourage food innovation efforts and help companies to tap into the expertise of larger corporations, food scientists and industry associations like FIA.

One recent collaboration under FoodInnovate is the High Pressure Processing (HPP) Resource Sharing Facility. HPP extends the shelf life of food products and preserves their nutritional quality. The facility is the result of a collaboration between Warehouse Logistics Net Asia, the Food Innovation Resource Centre and Enterprise Singapore. The pay-per-use model means that food companies need not fork out hefty upfront investments in equipment but can still tap these advanced technologies. Some of your favourite local juice companies, including Juix Up, HIC Juice and Daily Juice, now preserve their cold-pressed juices using HPP technology.

As with any industry, the challenge for smaller firms and startups is having the capability and capacity to create and test the commercial viability and scalability of products. Larger companies face their own production hurdles too, like having to stop existing production lines to test-run new food products, resulting in high disruption costs.

A small batch production facility within the JTC Food Hub @Senoko - a shared food manufacturing development - will be established to mitigate these pain-points. When ready by end 2019, companies will be able to rent advanced equipment on a pay-per-use basis to experiment and produce small batches of new products, thus allowing them to innovate while minimising costs. To date, more than 15 food companies have expressed interest to use the facility.

FIA and FoodInnovate are just two platforms that advance the food innovation agenda. To establish Singapore as a leading food and nutrition hub in Asia, government agencies, industry bodies, food manufacturers and other stakeholders must seek new ways to collaborate. In a few years' time, we should see higher commercialisation rates of new, innovative, high quality, functional and more attractive Singapore food products here and overseas.

Source: The Business Times © Singapore Press Holdings Limited. Reproduced with permission.