Market Overview – Malaysia

March 2019

Market snapshot

In 2018, Malaysia recorded a population of 32,042,458, ranking 45th globally and increasing 1.3% over 2017. Malaysia's population will gradually reach 34,949,758 by 2025.

Malaysia's gross domestic product (GDP) was 314.5 billion US dollars (US$) in 2017, up 6.0% from 2016.

The GDP per capita was US$11,521.4 in 2017, an all time high.

Malaysia's trade balance ranking was 13th among 121 countries in 2017, while the country ranked 22nd as both an importer and an exporter that same year.

Total agri-food and seafood imports to Malaysia were US$15.7 billion in 2017, while exports amounted to US$21.9 billion, increasing 4.7% and 3.7% respectively from 2016.

Canada was Malaysia's fourteenth largest agri-food and seafood supplier in 2017, having exported US$218.9 million to Malaysia and capturing 1.4% of its market share.

Total packaged food sales are expected to reach US$9.9 billion by 2022, a compound annual growth rate (CAGR) of 6.4% from 2018, and a total increase of US$2.7 billion over 2017. The top three packaged foods include rice, pasta and noodles.

In the health and wellness food products sector, Malaysia recorded retail sales of US$2.8 billion in 2017. As a whole, retail sales in this sector are expected to increase to 3.6 billion by 2022, a CAGR of 5.2% from 2018.

Production

Palm oil is Malaysia's principle crop with production amounting to 19,683 metric tons in 2017, production has been steadily increasing since 2014.

Soybean meal and soybean oil saw the greatest CAGR increase, 12.4% and 12.3% respectively.

In terms of meat production, poultry broiler meat had the largest CAGR for 2013 to 2017, 12.3% between 2013 and 2017, while beef and veal recorded 0.9% increase and chicken −0.8%.

Crop production in Malaysia, 2013 to 2017
Top ten crops (metric tonnes) 2013 2014 2015 2016 2017 CAGR* % 2013-2017
Oil, palm 20,161 19,879 17,700 18,858 19,683 −0.6
Oilseed, palm kernel 5,100 5,050 4,500 4,780 4,924 −0.9
Meal, palm kernel 2,577 2,522 2,245 2,384 2,602 0.2
Oil, palm kernel 2,332 2,280 2,019 2,149 2,312 −0.2
Coffee, green (1,000 60 kilogram bags) 1,400 1,500 2,100 2,200 2,100 10.7
Rice, milled 1,755 1,800 1,800 1,820 1,820 0.9
Meal, soybean 291 339 465 425 465 12.4
Oil, soybean 66 77 105 96 105 12.3
Corn 60 56 58 58 58 −0.8
Oilseed, copra 28 28 29 29 29 0.9

Source: United States Department of Agriculture (USDA), 2018

*CAGR: Compound Annual Growth Rate

Meat production in Malaysia, 2013 to 2017
Meat (metric tonnes) 2013 2014 2015 2016 2017 CAGR* % 2013-2017
Poultry broiler 1,374 1,458 1,584 1,633 1,671 12.3
Chicken 1,223 1,298 1,416 1,486 1,521 −0.8
Beef and veal 26 27 27 28 28 0.9

Source: USDA, 2018

*CAGR: Compound Annual Growth Rate

Livestock production in Malaysia, 2012 to 2016
Livestock ('000 head) 2012 2013 2014 2015 2016 CAGR* % 2012-2016
Pigs 2,304 2,287 2,189 2,036 1,852 −5.3
Cattle 749 742 743 752 744 −0.1
Goats 447 432 429 435 463 0.9

Source: FAOSTAT, 2018

*CAGR: Compound Annual Growth Rate

Trade

Imports amounted to US$15.7 billion in 2017, an increase of 4.7% over 2016, while exports were recorded to be US$21.9 billion, a 3.7% increase during the same period, making Malaysia a net exporter of agri-food and seafood products.

Canada exported US$218.9 million worth of agri-food and seafood products to Malaysia in 2017, an increase of US$13.7 million from 2016, gaining fourteenth place as an agri-food and seafood supplier and 1.4% of the Malaysian market share.

The top four Canadian agri-food and seafood exports to Malaysia were wheat and meslin, soya beans, soya bean seed for sowing and canola oil, making up 74.4% of Malaysian imports from Canada.

Malaysia's top agri-food and seafood imports from the world, 2017
Commodity Import value US$ (millions) Top suppliers and market Share % Canada's share %
1 2 3
Raw cane sugar 887.5 Brazil: 85.4 Guatemala: 5.2 Thailand: 4.9 0.0
Cocoa beans 695.7 Côte d'Ivoire: 28.6 Ghana: 22.1 Ecuador: 10.9 0.0
Oilcake and other solid residues (soya-bean oil) 609.6 Argentina: 95.4 United States: 3.7 India: 0.6 0.01
Food preparations 594.9 Singapore: 25.3 United States: 18.2 Indonesia: 11.0 0.4
Maize (excludes seed for sowing) 532.1 Argentina: 52.6 Brazil: 36.3 United States: 9.1 0.0
Frozen, boneless meat of bovine animals 468.6 India: 84.3 Australia: 9.2 Brazil: 3.1 0.0
Semi-milled or wholly milled rice 346.6 Vietnam: 40.5 Thailand: 34.7 India: 10.0 0.0
Skimmed milk powder 286.9 New Zealand: 43.9 United States: 18.8 Australia: 11.4 3.3
Wheat 249.7 Australia: 55.6 Canada: 21.8 United States: 10.0 21.8
Vegetable fats and oils 241.8 Indonesia: 92.1 India: 2.0 Singapore: 1.9 0.0

Source: Global Trade Tracker, 2018

Retail sales

Packaged food sales increased by a CAGR of 6.3% over the period of 2013 to 2017, and are expected to remain steady through to 2022.

Rice, pasta and noodles were the top recorded packaged food retail sales at $US 2.0 billion, while dairy retail sales amounted to US$1.0 billion. Edible oils by contrast had the largest CAGR gain 9.3% for the period of 2013 to 2017. Sales of edible oils are expected to surpass dairy in the coming 5-year period ending 2022 and estimated to account for US$1.4 billion.

Processed meat and seafood were valued at US$471.5 million for the 2017 packaged food retail sales, increasing from US$454.5 million over the previous year, while processed fruit and vegetable sales increased by 2.5% from 2016 to US$68.9 million.

Packaged food retail sales in Malaysia – Historic in US$ millions, fixed 2018 exchange rate
Category 2013 2014 2015 2016 2017 CAGR* % 2013-2017
Total packaged food 5,648.0 5,916.4 6,283.2 6,713.1 7,198.0 6.3%
Rice, pasta and noodles 1,509.0 1,608.3 1,720.9 1,847.4 1,991.7 7.2%
Dairy 794.2 837.6 894.1 946.9 1,003.9 6.0%
Edible oils 601.0 628.0 661.6 746.0 859.0 9.3%
Baby food 487.9 519.4 553.7 602.0 657.0 7.7%
Baked goods 460.2 473.4 492.8 512.7 535.1 3.8%
Processed meat and seafood 420.2 434.7 438.0 454.5 471.5 2.9%
Confectionery 327.9 329.0 380.2 411.5 435.9 7.4%
Savoury snacks 324.5 334.8 346.6 358.4 370.5 3.4%
Sauces, dressings and condiments 245.6 257.5 277.5 291.9 310.8 6.1%
Ice cream and frozen desserts 154.9 158.7 165.4 173.0 178.3 3.6%
Sweet biscuits, snack bars and fruit snacks 119.9 125.5 133.2 140.1 147.3 5.3%
Breakfast cereals 66.5 68.8 72.4 76.2 79.7 4.6%
Processed fruit and vegetables 62.5 63.7 65.5 67.3 68.9 2.5%
Sweet spreads 31.9 33.9 36.4 38.6 40.1 5.9%
Ready meals 26.9 27.4 28.2 29.6 30.9 3.5%
Soup 15.0 15.7 16.5 17.1 17.5 3.9%

Source: Euromonitor International

*CAGR: Compound Annual Growth Rate

Packaged food retail sales in Malaysia – Forecast in US$ millions, fixed 2018 exchange rate
Category 2018[e] 2019 2020 2021 2022 CAGR* % 2018-2022
Total packaged food 7,693.4 8,197.8 8,718.6 9,271.0 9,854.5 6.4%
Rice, pasta and noodles 2,153.8 2,322.2 2,496.7 2,684.8 2,889.2 7.6%
Edible oils 951.5 1,055.6 1,164.7 1,277.4 1,388.4 9.9%
Dairy 1,066.3 1,133.5 1,205.0 1,283.6 1,369.7 6.5%
Baby food 710.5 738.6 764.7 789.4 813.1 3.4%
Baked goods 558.0 580.7 603.1 626.0 649.8 3.9%
Confectionery 462.0 493.2 525.8 560.9 598.7 6.7%
Processed meat and seafood 488.6 506.7 524.8 543.8 563.8 3.6%
Savoury snacks 385.2 402.2 418.9 436.1 453.8 4.2%
Sauces, dressings and condiments 328.8 348.7 369.7 392.7 418.1 6.2%
Ice cream and frozen desserts 187.9 198.3 209.3 221.2 234.3 5.7%
Sweet biscuits, snack bars and fruit snacks 155.1 163.7 172.8 182.6 193.2 5.6%
Breakfast cereals 83.4 87.0 90.5 93.9 97.4 4.0%
Processed fruit and vegetables 70.3 71.6 73.0 74.4 76.0 2.0%
Sweet spreads 41.8 43.7 45.6 47.8 50.1 4.6%
Ready meals 32.2 33.6 35.0 36.6 38.4 4.5%
Soup 17.9 18.5 19.1 19.8 20.5 3.4%

Source: Euromonitor International, 2018

e: Estimate

*CAGR: Compound Annual Growth Rate

Health and wellness food products

Health and wellness retail sales grew by a CAGR of 4.7% for the period 2013 to 2017, and are expected to grow by a CAGR of 5.2% between 2018 and 2022.

Fortified and functional foods accounted for approximately US$2.2 billion of the US$2.8 billion in health and wellness retail sales and are forecasted to increase to US$2.8 billion by 2022.

Health and wellness food product retail sales in Malaysia – Historic in US$ millions, fixed 2018 exchange rate
Category 2013 2014 2015 2016 2017 CAGR* % 2013-2017
Health and wellness by type 2,362.3 2,489.5 2,605.8 2,777.3 2,836.6 4.7
Fortified/functional 1,787.6 1,887.7 1,975.0 2,110.9 2,151.9 4.8
Naturally healthy 337.9 354.6 370.9 392.7 398.4 4.2
Free from 169.5 176.6 186.0 195.7 207.0 5.1
Better for you 65.3 68.5 71.5 75.5 76.7 4.1
Organic 2.0 2.2 2.3 2.5 2.6 6.8

Source: Euromonitor International, 2018

*CAGR: Compound Annual Growth Rate

Health and wellness food product retail sales in Malaysia – Forecast in US$ millions, fixed 2018 exchange rate
Category 2018[e] 2019 2020 2021 2022 CAGR* % 2018-2022
Health and wellness by type 2,963.4 3,115.6 3,275.2 3,447.5 3,634.4 5.2
Fortified/functional 2,247.7 2,364.8 2,486.6 2,617.8 2,760.7 5.3
Naturally healthy 414.8 434.2 456.0 480.1 506.5 5.1
Free from 218.7 231.2 243.9 257.1 270.8 5.5
Better for you 79.5 82.5 85.8 89.6 93.5 4.1
Organic 2.7 2.8 2.8 2.9 3.0 2.7

Source: Euromonitor International, 2018

e: Estimate

*CAGR: Compound Annual Growth Rate

Opportunities for Canada

On March 8, 2018, Canada signed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP) with 10 countries: Australia, Brunei, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore and Vietnam. CPTPP represents a significant step toward closer trade and investment between Canada and Malaysia. Significant gains are possible for Canadian producers, who could gain market share in economies such as Malaysia. The CPTPP provides Canada with greater market access to CPTPP countries with the same level of tariff as major regional competitors like Australia and New Zealand for key sectors, including beef, pork, seafood, cereal and many others. For information on CPTPP, please read CPTPP and Canada's agriculture and agri-food sector

The CPTPP Agreement, along with NAFTA and free trade agreements with the European Union (CETA) and South Korea (CKFTA), will make Canada the only G7 nation with free trade access to the Americas, Europe and the Asia-Pacific region.

All Canadian provinces and territories are expected to benefit from the CPTPP.

For more information

International Trade Commissioners can provide Canadian industry with on-the-ground expertise regarding market potential, current conditions and local business contacts, and are an excellent point of contact for export advice.

For additional intelligence on this and other markets, the complete library of Global Analysis reports can be found on the International agri-food market intelligence page, arranged by region.

Resources

Market Overview: Malaysia
Global Analysis Report

Prepared by: André Ajaltouny, Market Analyst

© Her Majesty the Queen in Right of Canada, represented by the Minister of Agriculture and Agri-Food (2019).

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