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Pork in the ASEAN region: Opportunities for Canadian companies in the Philippines, Singapore and Vietnam

This report considers the market opportunities for Canadian pork in three countries in the Association of Southeast Asian Nations (ASEAN) region: the Philippines, Singapore, and Vietnam. The other members of this region are: Brunei, Cambodia, Indonesia, Laos, Malaysia, Myanmar and Thailand.

This information is useful for Canadian exporters in this sector that are interested in the ASEAN market and taking advantage of enhanced trading opportunities with certain ASEAN members, such as those created by the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).

Note: Unless otherwise noted, the information in this report has been compiled using 2017 UN Comtrade data and refers to pork as defined by HS 0203 - Meat of swine, fresh, chilled or frozen.

This report was commissioned and overseen by the High Commission of Canada to Singapore, and was prepared by a consultant. Although every effort has been made to ensure that the information is accurate, Agriculture and Agri-Food Canada (AAFC) assumes no liability for any actions taken based on the information contained herein.

Summary

A growing population and ongoing urbanization are driving the ASEAN region to consume more and higher value foods. In particular, ASEAN’s growing middle class is developing a taste for more high protein foods that are more convenient and nutritious. The following sections summarize the market potential for Canadian pork exports by country, presenting key market metrics and an overview of market opportunities and challenges.

The Philippines pork market potential summary

This is an important pork export market for Canada globally, and its most important market in ASEAN.

Overview of key metrics
Metric Philippines
Total import market size 95,027 tonnes
Growth in import market size from 2013-2017 +10.6%
Total import demand (2017) Can$223 million
Imports from Canada (2017) 28,519 tonnes
Main suppliers in 2017 and their market share in percent of total tonnes imported Canada: 30.0%
Germany: 22.2%
USA: 15.9%
France: 12.6%
Change in Canada's market share from 2013-2017 +0.9%
Competition level Moderate
"Temperature" of the overall market opportunity Hot

Opportunities:

Challenges:

Singapore pork market potential summary

In Singapore, the frozen pork market is price sensitive, relying on low cost suppliers like Brazil. At the high end of the market, branded pork such as Iberico from Spain and Kurobuta from Japan are prized by consumers. Canada has yet to achieve this kind geographic brand.

Overview of key metrics
Metric Singapore
Total import market size 106,468 tonnes
Growth in import market size from 2013-2017 8.1%
Total import demand (2017) Can$362.1 million
Imports from Canada (2017) 3,616 tonnes
Main suppliers in 2017 and their market share in percent of total tonnes imported Brazil: 33.5%
Australia: 28.8%
Holland: 15.0%
Canada: 3.4% (Rank: 6th)
Change in Canada's market share from 2013-2017 -1.7%
Competition level High
"Temperature" of the overall market opportunity Hot

Opportunities:

Challenges:

Vietnam pork market potential summary

Currently, the Vietnamese market is characterised by huge domestic pork production and low import demand. A series of free trade agreements (FTAs) with major suppliers will expose the previously protected markets to new competitive pressures from imports.

Overview of key metrics
Metric Vietnam
Total import market size 5,216 tonnes
Growth in import market size from 2013-2017 20.2%
Total import demand (2017) Can$16.9 million
Imports from Canada (2017) 674 tonnes
Main suppliers in 2017 and their market share in percent of total tonnes imported Spain: 19.7%
Poland: 18.2%
USA: 16.6%
Canada: 12.9%
Change in Canada's market share from 2013-2017 -5.9%
Competition level Moderate
"Temperature" of the overall market opportunity Cold

Opportunities:

Challenges:

Trends in pork consumption and import demand

In recent years, pork consumption and pork imports have been growing across all ASEAN markets. The Philippines, Singapore and Vietnam all rank in the top 20 Canadian pork export markets by tonnage. Singapore and the Philippines are large net importers. Vietnam was a major producer and net exporter, with 30,000 tonnes of pork exports in 2017.

Globally, these countries are much lower-ranking import markets with Singapore ranking 23rd, the Philippines ranking 24th and Vietnam ranking 58th. Canada’s pork market penetration is strong in the Philippines and Vietnam, but is weaker in Singapore.

Canada’s top export destinations for fresh, frozen and chilled pork in 2017
Rank Country Tonnes (thousands)
1 USA 296.3
2 China 209.6
3 Japan 208.5
4 Mexico 77.2
5 Philippines 33.7
6 Republic of Korea 29.4
7 Australia 15.8
8 Chile 10.7
9 New Zealand 9.6
10 Hong Kong 4.1
11 Colombia 4.0
12 Singapore 3.5
13 Cuba 3.1
14 South Africa 2.3
15 Trinidad and Tobago 1.9
16 Georgia 1.5
17 Albania 1.3
18 Vietnam 1.2
19 Costa Rica 1.1
20 Barbados 1.1
21 United Arab Emirates 0.9
22 Jamaica 0.9
23 The Former Yugoslav Republic of Macedonia 0.8
24 Peru 0.7
25 Panama 0.7
The world’s top importers of fresh, frozen and chilled pork in 2017
Rank Country Tonnes (thousands)
1 China 1,216.8
2 Italy 966.1
3 Japan 932.1
4 Germany 915.8
5 Mexico 803.5
6 Poland 659.6
7 Republic of Korea 489.5
8 United Kingdom 462.7
9 USA 452.3
10 Hong Kong 359.4
11 France 290.7
12 Netherlands 288.8
13 Russia 281.2
14 Czech Republic 267.1
15 Romania 232.4
16 Greece 201.4
17 Australia 156.8
18 Austria 140.6
19 Slovakia 130.9
20 Spain 121.0
21 Bulgaria 111.4
22 Portugal 110.8
23 Singapore 106.5
24 Philippines 95.0
/58 Vietnam 5.2

The Philippines

Latest UN data indicates a dramatic rise in the value and volume of pork imports into the Philippines, increasing nearly ten‐fold from around 10,000 tonnes in 2007 to 95,000 tonnes a decade later. The rapid growth in import demand is partly due to local swine production inefficiencies. According to the Philippine Council for Agriculture, Aquatic, and Natural Resources Research and Development – Livestock Research Division, 65% of the pigs in the Philippines are kept by smallholder pig raisers. Local pork production will expand driven by ongoing investment, but will not be sufficient to dampen import demand. Pork output is estimated to reach 1.3 million tonnes in 2019.

On the consumption side, a buoyant economy and the country’s demographic dividend is lifting consumer demand. The Philippines’ Meat Importers and Traders Association has predicted that the meat imports will continue to hit record highs due to the sustained growth in demand for processed meat products.

According to Philippines Bureau of Animal Industry (BAI) data, most of the Philippines’ meat imports are pork. In 2017 pork accounted for 44% of the total volume of meat imports. Pork imports in 2017 also posted high growth, expanding by 10.7% to a record 305,480 tonnes, up from 276,000 tonnes in 2016. Pork cuts, bellies and deboned meat constituted about 30.2% of pork imports by volume, which are mostly used by meat processors. The balance, commonly imported by meat traders, includes fats, rind/skin and other products.

Data from the Philippines Department of Agriculture (DA) showed that offal accounted for the bulk, or 43.2%, of the country’s pork imports by weight in 2017 (up 11.6% to 132,000 tonnes).

The spread of African Swine Fever (ASF) in the Philippines has negatively impacted the local backyard swine industry. While this increases the demand for pork imports, restrictive measures imposed by local government units have resulted in restrained distribution of processed meats – even if they are made from ingredients from non-ASF affected countries.

The Philippines’ pork imports from 2000 – 2017, in thousands of tonnes and millions of dollars
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Year Imports (Can$ - Millions) Tonnes (thousands)
2000 26.0 16
2001 15.1 10
2002 12.4 9
2003 11.1 9
2004 11.0 11
2005 8.0 7
2006 4.0 4
2007 8.9 10
2008 27.9 30
2009 36.3 37
2010 48.3 64
2011 46.6 58
2012 71.5 57
2013 116.2 73
2014 134.8 71
2015 142.6 59
2016 172.8 78
2017 222.9 95

Singapore

Singapore imports all the pork it consumes, as local pig farming was phased out in the 1980s. Singapore still imports live pigs from Indonesia, and more recently from Malaysia, but this supply accounts for only about 20% of the country’s pork consumption. The pork market has grown steadily over the past decade in both value and volume terms, and is supported by high rates of immigration and booming inbound tourism. In future, politically unpopular population growth will no longer be a demand driver and pork demand growth will slow. This trend will be reinforced by the city‐state’s market maturity and a trend towards more healthy eating habits among Singaporeans.

Pork is still the red meat of choice for Chinese Singaporeans. In 2017, Singapore imported over 106,000 tonnes of pork. The country’s pork supply is well diversified, sourced from more than 20 countries. The Singapore Food Agency (SFA), which was established on April 1st 2019 and oversees the city-state’s food safety and security, is exploring new sources of food to reduce Singapore’s vulnerability to supply disruptions.

Most of Singapore’s pork is either chilled pork imported from Australia or frozen pork imported from the EU, Brazil and the US. Singapore also imports live pigs for slaughter from Indonesia. In 2017, Canada accounted for 4.4% of Singapore's approximately 10,000 tonnes of swine offal imports (HS 020630/41/49).

Singapore’s pork imports from 2000 – 2017, in thousands of tonnes and millions of dollars
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Year Imports (Can$ - Millions) Tonnes (thousands)
2000 151.7 51.6
2001 156.5 49.6
2002 174.3 54.6
2003 175.8 59.2
2004 184.1 61.3
2005 173.9 56.4
2006 196.0 65.5
2007 201.5 68.1
2008 216.0 64.6
2009 228.0 67.2
2010 240.7 72.4
2011 238.8 66.0
2012 260.3 72.1
2013 247.7 66.7
2014 310.8 81.2
2015 324.2 81.2
2016 332.2 81.6
2017 362.1 106.5

Vietnam

Vietnam is not a major pork importer as it is the sixth largest producer of pork globally, after China, the EU, the US, Brazil and Russia. Historically, imports have accounted for a minuscule share of Vietnam’s pork consumption and import demand is volatile, mainly due to neighbouring China’s influence in the market.

Only a small portion of Vietnam’s pork production is officially exported; 26,000 tonnes to Hong Kong and 3,000 tonnes to Malaysia in 2017. A more significant trade in live hogs occurs across the China-Vietnam border, some of which is ‘informal’. Disruptions in the Chinese imports can have serious implications for surplus capacity and pork prices, and may also effect import demand for pork.

Vietnam saw high pork prices in 2016, which were caused by high pork exports to China, pushing up domestic production. This subsequently led to a record oversupply, a slump in pork prices and severe financial strain for local pig farmers. In 2017, the government launched a programme to support domestic sales through subsidised prices. The volatility in local production and periodic oversupply is not conducive to imports. Future import demand may be higher than anticipated due to foot-and-mouth disease in the northern provinces where most pig farming is concentrated.

An outbreak of African Swine Fever (ASF) entered Vietnam in February 2019, and since then has spread widely into all parts of the country. This has resulted in the culling of at least 20% of the pig population and has significantly driven up local pork prices, and has led to far-reaching and medium-term impacts on both the pork and animal feed markets. Pork production is slowing down due to fear of ASF, resulting in lower demand for imported feed. At the same time demand for pork imports to Vietnam are on the rise.

Vietnam’s pork imports from 2006 – 2016, in thousands of tonnes and millions of dollars
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Year Imports (Can$ - Millions) Tonnes (thousands)
2006 0.2 0
2007 0.1 0
2008 23.7 0
2009 3.5 1
2010 1.8 1
2011 14.6 6
2012 6.9 Not available
2013 6.9 Not available
2014 9.7 3
2015 21.9 5
2016 25.1 8

Note: Data was not available for quantity of pork imported by Vietnam in tonnes for 2012 and 2013.

Pork consumption is forecast to grow at annual average rate of 3.2% through 2022 in Vietnam according to the Fitch Solutions Vietnam Agribusiness Report published in Q2 2019. The Vietnamese consume 33.5kg of meat per person a year, a figure which is expected to rise to 39kgs by 2020 according to VietNamNet Bridge. Reportedly, 1.8 million tons of pork was consumed in Vietnam in 2017, 57% of all meat consumed.

Regulatory requirements

This section provides important regulatory import requirements for pork exports to Singapore, the Philippines and Vietnam.

The Philippines

Key regulatory bodies in the Philippines are the Bureau of Animal Industry (BAI), the Bureau of Fisheries & Aquatic Resources (BFAR) and the Bureau of Plant Industry (BPI). All of these fall under the jurisdiction of the Department of Agriculture. The BAI prescribes standards for quality in the importation, labelling, advertising, distribution and sale of pork products, among others. The National Meat Inspection Commission (NMIC) scrutinizes post production flow of meat and meat products, both locally produced and imported.

There is a two-tiered system for regulating the handling of frozen versus fresh meat for sale in the country’s traditional “wet” markets. The Philippines imposes more burdensome bureaucracy on the sale of frozen meat, which is mainly imported, than it does on the sale of freshly slaughtered meat from domestic herds.

Canadian pork exporters interested in the Philippines are encouraged to review the Philippines export requirements for meat and poultry products produced by the Canadian Food Inspection Agency (CFIA). It summarizes the requirements and regulatory considerations relating to pork imports into that market.

Singapore

Singapore has no special requirements or restrictions on imports of Canadian pork in all its forms (frozen, chilled, offal, etc.). There was an issue in relation to specific hormone usage some years ago, but this has long since been resolved.

The Singapore Food Agency (SFA), formerly known as the Agri-Food & Veterinary Authority of Singapore (AVA), is the Singaporean authority responsible for food, agriculture and seafood. It aims to ensure a resilient supply of safe food. SFA adopts a diversification strategy to facilitate the availability of a variety of safe food at stable prices. Meat products may only be imported from approved sources as determined by the SFA. Singapore prohibits or restricts pork imports from a number of countries, but Canada is not one of these.

Countries approved to export raw and processed meat products to Singapore (as of 29 January 2019):

Some imported pork is inspected upon entering Singapore. Samples can be taken by SFA for lab analysis, which may have to be completed prior to distribution or sale. All imports of uncooked pork are visually inspected and also regularly subjected to laboratory testing for salmonella and other bacteria.

The SFA has increased the number of approved pork suppliers, including those from Malaysia. Their aim is to further diversify pork sources, which may result in increased competitive pressure. Notably, in January 2019 the SFA suspended import of pork and pork products from areas in China with African swine fever outbreaks. However, China was not a major pork supplier to Singapore even before that, with less than 5% of imports.

Canadian pork exporters interested in Singapore are encouraged to review the Singapore export requirements for meat and poultry products produced by the CFIA. It summarizes the requirements and regulatory considerations relating to pork imports into that market.

Vietnam

Pork production is a highly protected industry in Vietnam. While the CPTPP will see tariffs on Canadian pork imports gradually reduced, Canadian exporters will still be required to meet all Vietnamese import requirements. Pork exporters must be pre-approved by the Vietnamese authorities. Once a detailed application is prepared and endorsed by the CFIA, the process can still take several months more—and may not eventually succeed. Vietnam's Animal Health Department, under the Ministry of Agriculture and Rural Development (MARD), promises a review and response within 30 days. Usually, this takes much longer with multiple rounds of follow up questions and resubmissions, even though the CFIA has already given its approval.

In February 2018, Vietnam adopted Decree 15 on the enforcement of the Food Safety Law, providing new guidance on registrations, announcements, certificates, labels, advertisements, working conditions, origins of food and food additives, and jurisdiction for food safety issues. The Decree should simplify import procedures for agri-food products. However, the transfer of authority to propose maximum residue limits (MRLs) for food safety from Vietnam's Ministry of Health (MOH) to MARD may result in more restrictive practices concerning MRLs.

Canadian pork exporters interested in Vietnam are encouraged to review the Vietnam export requirements for meat and poultry products produced by the CFIA. It summarizes the requirements and regulatory considerations relating to pork imports into that market.

Competitive environment

Canada is a leading supplier of pork to the Philippines and Vietnam. In 2017, it was the biggest supplier of pork to the Philippines with a 30% share of that country’s imports by volume. Canada is only a niche supplier to Singapore, despite the country being a large market for imported pork due to its lack of local production. Over the past five years, Canada has lost market share in Singapore, Vietnam and the Philippines.

The Philippines

In recent years, Europe has overtaken North America as the most important supplier of pork to the Philippines. In 2013, Canada and the US contributed 54.6% of the Philippines’ pork imports. By 2017, that percentage had shrunk to 35.9%. Seven of the top 10 pork suppliers are European. For example, Spain’s exports to the Philippines have reportedly increased significantly due to their aggressive efforts to establish business relationships with Philippine meat importers.

The Philippines pork imports: Top 10 countries in 2017 and value of imports in US dollars
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Rank Country Imports (US$)
1 Canada $54,527,595
2 Germany $36,653,466
3 USA $27,894,047
4 France $20,529,811
5 Spain $13,258,772
6 Netherlands $4,914,078
7 United Kingdom $3,250,587
8 Belgium $2,587,487
9 Ireland $2,243,319
10 Brazil $2,029,579

The Philippines pork imports: Five-year growth (2012-2017) in terms of tonnes exported for selected countries

Singapore

At around 25,000 tonnes in 2017, Singapore imports of chilled pork were smaller than that of frozen pork (81,000 tonnes). The chilled pork import market has also been expanding more slowly than the frozen pork import market with a 2.4% CAGR versus 5.3% CAGR for 2008-17, respectively. Australia dominates the chilled pork import market with a 97.4% share of chilled pork imports by weight. Almost all Australian pork exports to Singapore are air-flown chilled. Canada is the only other significant supplier of chilled pork to Singapore and has increased its market share from 0.8% of total chilled pork imports in 2007 to 2.4% (62,000 tonnes) in 2017.

Brazil continues to dominate Singapore's frozen pork market, supplying around half of the country's frozen pork. Canada's market share of Singapore's frozen pork imports has barely changed over the past 10 years (3.8% in 2007 and 3.7% in 2017 by value). In the frozen category, Canada is up against Brazil, competing aggressively on price point. European competitors, notably Spain and the Netherlands, have achieved strong gains in market penetration over the same period.

Change in Singapore frozen pork imports by market over time, in tonnes
(HS 020312, 020322 and 020329)
Market 2007 2012 2017
Canada 1,827,151 2,078,960 2,996,674
Australia 1,174,002 799,010 583,802
Brazil 30,866,560 26,976,010 35,625,441
China 1,581,760 1,201,270 2,146,412
Germany 768922 1,939,580 2,420,632
Netherlands 4,148,236 10,932,330 15,911,810
Spain 0 2,466,170 10,500,126
USA 621,677 7,329,240 4,212,248
Other 7,168,931 9,713,720 6,644,288
World total 48,157,239 63,436,290 81,041,433
Change in Singapore frozen pork imports by market over time, in percentage of tonnes imported
(HS 020312, 020322 and 020329)
Market 2007 2012 2017
Canada 3.79% 3.28% 3.70%
Australia 2.44% 1.26% 0.72%
Brazil 64.10% 42.52% 43.96%
China 3.28% 1.89% 2.65%
Germany 1.60% 3.06% 2.99%
Netherlands 8.61% 17.23% 19.63%
Spain 0.00% 3.89% 12.96%
USA 1.29% 11.55% 5.20%
Other 14.89% 15.31% 8.20%
World 100.00% 100.00% 100.00%

Vietnam

Having long since targeted the Vietnam pork market, European pork exporting countries, such as Poland, Spain and Germany, have become very successful in Vietnam. According to EU Union of Producers and Employers of the Meat Industry, meat exports from the EU to Vietnam grew by 7.5 times in the 2013-15 period. Analysts predict that imports from Europe may rise further once the Vietnam-EU FTA is ratified and implemented; frozen pork meat will be duty-free after seven years under the agreement.

Vietnam pork imports: Top 10 countries in 2017 and value of imports in US dollars
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Rank Country Imports (US$)
1 Spain $2,568,292
2 Poland $2,374,038
3 USA $2,154,186
4 Canada $1,680,466
5 Germany $1,325,126
6 Italy $632,880
7 Brazil $481,169
8 Ireland $476,243
9 Australia $447,235
10 France $306,156

Buyer preferences

The Philippines

Philippine buyers are conservative. They are very price sensitive and yet also want reasonable quality. For example, some recent shipments of pork from Canada to the Philippines were considered to be too pale in colour, which made the pork appear not fresh to the buyers. Relationship building is also critical in the Philippines as Filipinos are highly sociable people. Spain has been very diligent in its marketing efforts with consistent and sustained relationship selling convincing customers that Spain genuinely prioritises the Philippines pork market. Brand building efforts are also appreciated by buyers. Besides price and product quality, the consistency of supply and product support are the main selection criteria for local buyers.

The vast majority of Canadian pork shipments to the Philippines are frozen. The following table shows the types of Canadian pork cuts that are in demand in the Philippines.

Canadian pork exports to the Philippines in 2018
Product and HS code Value (Can$) Percent
0203 - Pork (total) 89,685,231 100.00%
020329 - Swine, Cuts Boneless - Frozen 80,594,796 89.86%
020322 - Swine, Cuts With Bone in - Frozen 6,770,332 7.55%
020319 - Swine, Cuts Boneless - Fresh or Chilled 1,577,105 1.76%
020312 - Swine, Cuts With Bone in - Fresh or Chilled 462,774 0.52%
020311 - Swine, Carcasses and Half-Carcasses - Fresh or Chilled 206,410 0.23%
020321 - Swine, Carcasses and Half-Carcasses - Frozen 73,814 0.08%
Source: Global Trade Tracker 2019

More broadly, the Philippines Bureau of Animal Industry reported imports from Canada of 615 tonnes of pork bellies, 36,356 tonnes of pork cuts, 2,343 tonnes of pork fats, 9,393 tonnes of pork offal and 272 tonnes of pork skins.

Singapore

Favourable pricing and suitable cuts are the main criteria for frozen pork. For chilled pork, the real or perceived quality of the product is the most important buying criteria for higher-end specialty products. Pork products such as Kurobuta, a haute Japanese pork protein equivalent to Wagyu beef, and Iberico pork, from Spain or Portugal, are well known in Singapore’s high end restaurants and supermarkets. For these very wealthy customers, high price can signal quality. In Singapore, those familiar with Canadian pork consider it to be a premium product on a par with that of the US at a similar price point. Danish pork continues to enjoy the strongest national brand mass recognition in Singapore.

Canada has a good reputation in Singapore for its high value, fresh chilled pork, especially among high-end bulk retail buyers. However, the volume market is for frozen secondary cuts, mainly destined for the food service industry and food processing plants.

Canadian pork exports to Singapore in 2018
Product and HS code Value (Can$) Percent
0203 – Pork (Total) 5,037,307 100.00%
02032900 – Swine cuts, frozen nes 2,968,589 58.93%
02031999 – Pork, nes, fresh or chilled 972,849 19.31%
02031991 – Pork bellies, fresh or chilled 514,372 10.21%
02031910 – Pork spare ribs, fresh or chilled 217,337 4.31%
02032200 – Hams, shoulders and cuts thereof, of swine, bone in, frozen 216,283 4.29%
02031220 – Pork shoulders and cuts thereof, bone in, fresh or chilled 147,877 2.94%
Source: Global Trade Tracker 2019

Vietnam

The Vietnamese livestock industry is led by pig farming. Pork production accounts for almost 80% of the country’s meat production. Demand for imported pork is highest in the food services and food processing industries. At the higher end of the market, consistent quality is highly valued and Canadian pork enjoys a good reputation in this regard. Food processors such as Duc Viet Food (sausages) and CP Vietnam are known to use Canadian pork, which is reportedly competitive on price and will become more so with tariff preferences under the CPTPP.

Canadian pork exports to Vietnam in 2018
Product and HS code Value (Can$) Percent
0203 – Pork (Total) 1,366,031 100.00%
020329 - Swine, Cuts Boneless - Frozen 737,342 53.98%
020322 - Swine, Cuts With Bone in - Frozen 628,689 46.02%
Source: Global Trade Tracker 2019

Overview of importers and distributors

The Philippines

Canadian companies should refer to the Philippines Department of Agriculture's National Meat Inspection Service for lists of accredited meat importers, meat processing plants and meat cutting plants.

In 2018, the Philippines' supermarkets recorded sales value growth of 6%; online grocery retailing is also beginning to grow.

Top supermarkets in the Philippines and their market shares
Supermarket Market share
SM Retail 20.4%
Robinsons Retail Holdings 11.6%
Puregold Price Club 3.7%
Rustan Group 3.4%
Walter Mart Supermarket 3%
Other supermarkets 57.9%
Source: Euromonitor, Jan 2019

According to the Philippines Tariff Commission – Executive Order 20, all pork imports to the Philippines in 2019 and 2020 face a 30% tariff rate when within a specified quota and a 40% tariff rate when outside of it.

Singapore

Canadian companies should consult the Singapore Food Manufacturers Association's member directory to find potential importers and distributors. Important importers and distributors of pork in Singapore include Hubers, Jordon International, OJJ and WTT Trading.

Supermarkets' retail sales rose by just 2% in 2018, reflecting a mature market and pressure from online retailers like Red Mart. In any case, Singapore's leading supermarket chains often do not carry Canadian pork.

Top supermarkets in Singapore and their market shares
Supermarket Market share
NTUC FairPice 43.5%
Sheng Siong 25%
Dairy Farm Int'l (Giant and Cold Storage) 24.1%
Prime Supermarket 3.6%
Other supermarkets 3.8%
Source: Euromonitor, Jan 2019

Included among the “Other supermarkets” is the Singapore branch of MEIDI-YA Supermarket, the second overseas branch of Japan’s upmarket grocery store chain. It is known to sell Canadian pork.

Vietnam

Among the major processed meat companies in Vietnam, CP Vietnam and Duc Viet Food are important buyers of imported pork. There are also a number of specialised importers with cold chain facilities.

The retail sector may import directly and Vietnam supermarket sales are expanding rapidly, by around 10% per year. Saigon Union of Trading Cooperatives is the dominant supermarket player.

Top supermarkets in Vietnam and their market shares
Supermarket Market share
Saigon Union of Trading Cooperatives 59.2%
VinGroup JSC 16.1%
Mobile World JSC 6.2%
Dong Hung Trading 2.4%
Saigon Trading Group 1.4%
Others 14.8%
Source: Euromonitor, Jan 2019

Supply chain dynamics

Snapshot of the typical pork trade distribution channels

There are a variety of paths for how pork could be distributed from the initial exporter to the final food processor. This chart shows a few of the options:

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Chart showcasing a range of six paths for how pork could be distributed from initial “Exporters” to final “Food processors” or “Small/household food processors”.

  • Path 1: Exporters to Food Processors
  • Path 2: Exporters to Local importers/Distributors to Food processors
  • Path 3: Exporters to Local importers/Distributors to Wholesalers to Food processors
  • Path 4: Exporters to Local to Wholesalers/Distributors to Food processors
  • Path 5: Exporters to Local to Wholesalers/Distributors OR Traditional sales channel/Modern sales channel to Small/household food processors
  • Path 6: Exporters to Agent to Food processors

Source: These options are a simplified version of the information presented in IPSOS Business Consulting's "Vietnam Meat Market: Mind the Gap!" report.

The Philippines

Importers and distributors cater to big supermarkets, hypermarkets and wholesale stores. Mom-and-pop stores, which are unlikely to carry Canadian pork products, are handled by agents or middle-men. Some big distributors employ sub-distributors in rural areas/provinces, reducing profits while increasing volume. Distribution costs can be high due to lack of infrastructure development and traffic congestion. Communications between suppliers and retailers have improved and retail chains have computerized their front to back-end operations. A number of importers distribute to fresh “wet” markets, which carry lower value cuts of pork.

There are about 500 food and beverage processors registered under the Philippines’ Food and Drug Administration (FDA) and while they are mostly micro to medium-sized businesses, some are among the largest corporations in the Philippine market.

The following table presents a snapshot of major retail groups in the Philippines and their retail presences:

Major retail groups Supermarkets Hypermarkets and warehouse store Convenience stores and mini-marts Other retail
SM Investments Corporation (SM Group)

Super Value or SM Supermarket, the food retail arm of SM Investments, is the dominant player in the Philippine retail sector.

It operates 40 branches inside SM malls across the country. SM bought Cherry Foodarama in 2014 and has three (3) stores.

SM Hypermarket is a superstore that combines both supermarket and department store and usually offers more than 150,000 Stock Keeping Units (SKUs) or merchandise brands to allow customers to satisfy all routine shopping needs in one trip. They have 43 branches nationwide.

SaveMore is a chain of neighbourhood grocery stores with 89 branches to date.

Launched Alfamart through a Joint Venture (JV) in 2016 and now has 78 branches.

SM partnered with AS Watson Group and operates Watsons in the Philippine market, which is both a convenience store and a pharmacy. They have 521 stores to date.
Puregold Price Club Inc.

Puregold Extra has 24 stores.

Parco Supermarket, acquired in 2012, and has 19 stores. Merkado Supermarket is a JV with Ayala Land and opened its first branch in 2015 for the middle class market.

Puregold Price Club has 144 stores nationwide.

S&R Membership Shopping (used to be US-owned PriceSmart) has 11 stores nationwide.

Puregold Jr. has 95 stores.

Launched Lawson in June 2015 and has 25 stores to date. They will roll out 500 branches in the next five years.

Not applicable.
Robinsons Retail Holdings Inc. / JG Summit Robinsons Supermarket has 136 stores nationwide. It was the first to promote health and wellness. Not applicable.

Robinsons Easymart a network of 13 compact neighbourhood grocery stores, providing ease of accessibility and convenience of grocery shopping to communities.

Established in 2000, Ministop operates 464 stores as a grocery and fast food diner.

Robinsons Selections' three (3) stores cater to the premium market and carry more imported merchandise. They have a food-to-go section, gourmet deli, health and wellness and a pharmacy.
Rustan's Supercenters Inc. Member of the Dairy Farm Group

Rustan's Supermarkets have 22 branches nationwide. They cater to the upscale market.

Rustan's Marketplace caters to the premium market and has three (3) stores to date.

Shopwise operates 13 hypermarkets nationwide. Wellcome has 20 branches to date Launched in 2013, FamilyMart is a Franchise partnership with Ayala Land. It has 58 stores in Metro Manila
Metro Gaisano Metro Supermarket has 16 branches but will expand in the next few years. Metro Hypermarket has 12 branches nationwide. Not applicable. Not applicable.
Source: Philippine Agriculture and Agrifood Sector at a Glance (2018), Canadian Trade Commissioner Service, Philippines

Singapore

Only a relatively small proportion of pork sales would go directly from the overseas supplier to end users. One example would be Hubers in Singapore, which has its own Primrose brand of pork air-flown from Canada. Some traders will have their own processing/cutting plants. Others will have no physical presence (i.e. no trucks or warehousing) and act more as traders/agent.

Currently, Canadian pork is not available in either of the two major supermarket chains, although it was previously sourced by a hypermarket named Giant. Canadian pork’s niche position in the Singapore market means that it has struggled to attain critical scale in mainstream retail.

Vietnam

Direct sales to food processors or via local importers or distributors are the most common practices in Vietnam, where most food importers also act as distributors. The aim is to reduce the number of intermediaries.

When entering Vietnam, overseas exporters will typically choose to work with local importers rather than establishing their own entities in Vietnam for a range of reasons, including:

Finally, for many Southeast Asian markets, Canada's longer supply chain can be a disadvantage due to higher logistics costs, with the distance also adding to fear that shipments could be spoiled.

CPTPP Implications

As of April 2019, seven signatories of the CPTPP agreement, including Singapore and Vietnam, have implemented the second round tariff cuts. A third round of tariff cuts will take place on January 1,2020, except for Japan which operates on a fiscal year (April 1, 2020).

Four other CPTPP countries still await domestic ratification before implementing their tariff cuts: Brunei, Chile, Peru and Malaysia. The CPTPP will enter into force 60 days after a signatory notifies the CPTPP Depository that it has completed its ratification procedures.

Going forward, economies that meet the high standards of the CPTPP may join the Agreement by accession, potentially furthering the economic benefits for Canada. To date, no economy has formally requested to commence the accession process. Economies that have publicly expressed interest in acceding to the CPTPP include: Thailand, South Korea, the United Kingdom, and Taiwan.

Canadian companies are encouraged to visit CPTPP for Agri-Food Exporters to find more general information on this agreement and how it can benefit your exports to its markets.

CPTPP pork tariffs in Singapore

Typically, Singapore does not levy import duties, except for tobacco, alcohol, vehicles and gasoline. Consequently, there are no tariff reductions under the CPTPP on imports of agricultural products into Singapore, and hence no impact on Canada’s competitiveness. Tariffs on Canadian fresh, chilled or frozen pork products (HS 0203) to Singapore are 0%.

CPTPP pork tariffs in Vietnam

Canada will gain competitive advantage from lower import tariffs on its pork exports under the CPTPP, although these will be phased in gradually over several years.

Generally, Canadian fresh and chilled pork products exported to Vietnam will see progressive tariff reductions on an annual basis, decreasing from 24.3% in 2018 to 0% in 2027. Canadian frozen pork products exported to Vietnam will also see progressive tariff reductions on an annual basis, decreasing from 13.1% in 2018 to 0% in 2025. Detailed information on Vietnam's schedule of tariff cuts by HS code is available at the Canada Tariff Finder website:

Australia, a fellow member of CPTPP, also exports pork to Vietnam and will enjoy the same benefits. It already enjoys preferential market access under the ASEAN-Australia-New Zealand Free Trade Agreement (AANZFTA).

Canada’s competitive advantage in exporting pork to Vietnam may be diminished when the European Union-Vietnam FTA (EVFTA) enters into force. The European Union and Vietnam are currently undertaking their domestic ratification procedures, however a timeline for completion has not been identified. Under the EVFTA, European frozen pork exports will enter Vietnam duty-free following seven years of annual cuts. The EU is currently the leading supplier of pork to Vietnam.

The US is not a party to the CPTPP agreement and Vietnam levies a 15% import duty on American frozen meat.

Canada’s CPTPP tariff advantage for frozen pork

Under the CPTPP, Canada sees a favourable tariff advantage for frozen pork products when compared to other competitors such as the US, the EU, Brazil and Ukraine.

Competitors % Total Imports 2017 Competitive FTAs Competitive Preferential Tariff, 2019 Tariff Schedule, years to reduce to 5% or less
Canada 12.5% CPTPP 11.2% 4
US 15.5% Not applicable / Under "Most favoured nation (MFN)" status 15.0% Not applicable
EU 63.6% EU – Vietnam FTA (EVFTA) 13.0% 5
Australia and New Zealand 2.3% ASEAN Australia New Zealand FTA (ANZFTA) and CPTPP 3.0% 0
Brazil 3.9% Not applicable / Under MFN status 15.0% Not applicable
Ukraine 1.6% Not applicable / Under MFN status 15.0% Not applicable
Malaysia 0.5% ASEAN Free Trade Area (AFTA) agreement 0.0% 0
Source: Intercedent Asia’s CPTTP Market Opportunity Model: Lookup Function

Notes:

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