INCOMING OPERATORI ESTERI AL

29° salone internazionale del biologico e del naturale

Il mercato dei prodotti Agroalimentari Biologici

in

SINGAPORESINGAPORE

Questa indagine è stata realizzata dall’ICE-Agenzia per la promozione all’estero e l’internazionalizzazione delle imprese italiane.Hanno contribuito alla realizzazione l’Ufficio di Singapore e per il layout grafico l’Ufficio Agroalimentare e Vini.

L’indagine è stata redatta sulla base delle informazioni disponibili al 15 luglio 2017

© ICE-Agenzia 2017

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SCHEDA

“PRODOTTI ALIMENTARI

BIOLOGICI”

per SANA 2017

Data: agosto 2017

ICE Singapore

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Table of Contents

PAGE

MARKET FOR SINGAPORE’S ORGANIC FOOD AND BEVERAGES___________________ 3

(A) INTRODUCTION TO THE SECTOR_____________________________________ 3

(B) TRENDS IN THE MARKET FOR ORGANIC FOOD AND BEVERAGES____________ 3

(C) STATISTICS FOR THE MARKET FOR ORGANIC FOOD AND BEVERAGES _______ 6

DISTRIBUTION SYSTEMS__________________________________________________ 8

USEFUL INFORMATION__________________________________________________ 9

INFORMATION ON CUSTOMS AND EXCISE DUTIES_____________________________ 12

CONTACT INFORMATION_________________________________________________ 14

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MARKET FOR SINGAPORE’S ORGANIC FOOD AND BEVERAGES

(A) INTRODUCTION TO THE SECTOR

With reference from data gathered from Euromonitor, demand for organic packaged food remained

niche in 2016, with demand mainly driven by a small consumer base. Organic packaged food grew by 4%

in current terms in 2016, which was slightly slower than average growth over the review period. Slower

growth was attributable to the accelerated growth of organic packaged food from a small and emergent

value base in the early part of the review period. While year-on-year current value growth remained

robust due to the high spending powers and awareness of organic products among domestic consumers,

growth was limited by the fact that the majority of consumers preferred not to spend on these high-

priced items. Additionally, although the shelf presence of organic packaged food in major supermarkets

and hypermarkets gradually increased over the review period, overall distribution remained diffused

and limited. For instance, as of 2016, organic products had penetrated only a handful of product

categories in Singapore, such as baby food, breakfast cereals, sugar confectionery, rice and pasta, and

olive oil. The organic market for other major packaged food types such as dairy products or snacks

remained negligible in 2016.

(B) TRENDS IN THE MARKET FOR ORGANIC FOOD AND BEVERAGES

Exceptions to the overall low demand for and presence of organic packaged food are organic baby food

and organic sugarised boiled sweets, both of which posted relatively strong current value growth of 5%

in 2016. Growth of organic baby food was driven by demand for brands such as Bellamy’s Organic in

organic milk formula. The brand generated significant consumer interest over the review period, which

was thanks to overwhelming demand for its products from the Chinese community and the ensuing

widespread media coverage of the product. Accordingly, retail value sales of organic milk formula

increased by 10% in current terms in 2016.

Organic breakfast cereals grew by a relatively robust 3% in current terms in 2016. It is evident from the

examples and product types listed above that parents in Singapore are more likely to purchase organic

packaged food for their children. They have the financial capacity and willpower to spend on their

children’s wellbeing.

In 2016, organic pasta continued to underperform when compared against other organic product

categories, growing by only 1% in current terms. Organic variants of dried pasta had yet to develop a

mainstream presence in Singapore, with only a limited number brands offering such products. In

addition, there were available mainly at more-premium supermarkets/hypermarkets. Given their high

retail selling prices, they are likely to continue to remain niche. Finally, compared to rice, pasta is not a

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mainstay staple in Singapore; therefore, consumers are less willing to invest in organic pasta given the

lower frequency of consumption. Indeed, displaying a reverse trend, organic rice posted relatively

robust current value growth of 4% in 2016.

The regulatory environment for organic packaged food in Singapore became stricter over the review

period. The Agri-Food & Veterinary Authority of Singapore put forth a number of amendments under

the Sale of Food Act at the beginning of 2016. According to the Food (Amendment) Regulations 2016,

food products labelled “organic” (or similar labelling/positioning) must be certified organic via an

inspection and certification system that complies with the Codex Guidelines for the Production,

Processing, Labelling and Marketing of Organically Produced Foods, GL 32-1999 (or similar guidelines).

The amendments came into force in February 2016, but are likely to have minimal impact on the

market. In Singapore, most existing brands offering organic packaged food are reliable players with

established international reputations and products that are certified organic in the first place.

Competitive Landscape

Major players and multinationals continued to demur from launching organic extensions of their

flagship food brands in Singapore, which was due to the overall low demand for organic packaged food

in the country. Investment in such product line extensions may prove futile; however, this trend does

not apply to manufacturers of food products consumed by children. As discussed above, the organic

products aimed at children notably enjoyed significant success over the review period. Players in

packaged food categories with young children forming a large portion of their consumer base would do

well to leverage on this trend by extending their organic offerings.

Organic packaged foods in Singapore are still largely positioned as premium products rather than as

standard or economy offerings. Higher retail selling prices and more-expensive packaging formats

continue to entrench their premium positioning. For example, organic prepared and dried baby food

was increasingly sold in attractive and convenient stand-up pouches over the review period.

Prospects

Organic packaged food is set to grow at a stable CAGR of 3% at constant 2016 prices over the forecast

period, reaching sales of SGD20 million in 2021 as it continues to emerge from a relatively small value

base.

Nonetheless, the category’s full growth potential will remain limited by consumers’ overall unwillingness

to spend on expensive organic products. There is also a lack of other push and pull factors within the

public health context, with the Health Promotion Board only advising on the origins of organic food on

its website, stating also that there is not a lot of evidence to show that organic food necessarily offers

more nutritional benefits than non-organic food. It is for these reasons that expected value growth of

organic packaged food over the forecast period is slightly lower than that registered during the review

period.

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Nonetheless, consumers in Singapore are discerning and increasingly seek out information on the

internet or through other resources to educate themselves on nutrition and health and wellness. As a

result, as more consumers become aware and convinced of the assurances offered by organic food (eg

less harmful due to the limited exposure to pesticides etc), demand will continue to increase over the

forecast period. This is especially relevant to parents who typically prioritise their children’s wellbeing

over costs.

Accordingly, demand for organic packaged food will continue to be driven by organic milk formula,

which is set to grow at a CAGR of 5% at constant 2016 prices, the fastest expected growth within the

overall category. There is also set to be more manufacturer activity within the category, such as the

extension of organic lines and also products targeted at children, including breakfast cereals, sugar

confectionery, and dried, prepared and other baby food.

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(C) STATISTICS FOR THE MARKET FOR ORGANIC FOOD AND BEVERAGES

Sales of Organic Packaged Food by Category: Value 2011-2016

SGD '000 2011 2012 2013 2014 2015 2016

Organic Baby Food 3,040.8 3,190.2 3,344.5 3,624.4 3,918.6 4,128.4

Organic Bread - - - - - -

Organic Breakfast Cereals 632.6 659.3 682.3 704.9 729.5 751.4

Organic Chilled Processed Meat and Seafood - - - - - -

Organic Confectionery 255.9 262.5 271.7 281.8 293.3 308.5

Organic Dairy - - - - - -

Organic Edible Oil 1,403.5 1,487.3 1,604.0 1,692.9 1,778.2 1,831.3

Organic Frozen Meat, Seafood, Fruit and

Vegetables 154.1 157.8 160.8 165.3 166.4 169.2

Organic Ice Cream - - - - - -

Organic Ready Meals - - - - - -

Organic Rice, Pasta and Noodles 7,355.0 7,728.3 8,126.0 8,647.3 9,031.7 9,366.3

Organic Sauces, Dressings and Condiments - - - - - -

Organic Savoury Snacks - - - - - -

Organic Shelf Stable Meat, Seafood, Fruit and

Vegetables - - - - - -

Organic Soup - - - - - -

Organic Spreads - - - - - -

Organic Sweet Biscuits, Snack Bars and Fruit

Snacks - - - - - -

Organic Packaged Food 12,841.8 13,485.4 14,189.3 15,116.5 15,917.7 16,555.0

Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade sources

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Distribution of Organic Packaged Food by Format: % Value 2011-2016

% retail value rsp 2011 2012 2013 2014 2015 2016

Store-Based Retailing 99.4 99.4 99.4 99.4 99.3 99.3

- Grocery Retailers 99.4 99.4 99.4 99.4 99.3 99.3

-- Modern Grocery Retailers 38.4 39.4 40.4 41.4 42.3 43.3

--- Convenience Stores - - - - - -

--- Discounters - - - - - -

--- Forecourt Retailers - - - - - -

--- Hypermarkets 2.6 2.6 2.6 2.6 2.7 2.7

--- Supermarkets 35.8 36.8 37.8 38.8 39.6 40.6

-- Traditional Grocery Retailers 61.0 60.0 59.0 58.0 57.0 56.0

--- Food/drink/tobacco specialists - - - - - -

--- Independent Small Grocers - - - - - -

-- Other Grocery Retailers 61.0 60.0 59.0 58.0 57.0 56.0

- Non-Grocery Specialists - - - - - -

Non-Store Retailing 0.6 0.6 0.6 0.6 0.7 0.7

- Vending - - - - - -

- Homeshopping - - - - - -

- Internet Retailing 0.6 0.6 0.6 0.6 0.7 0.7

- Direct Selling - - - - - -

Total 100.0 100.0 100.0 100.0 100.0 100.0

Source: Euromonitor International from official statistics, trade associations, trade press, company research, store checks, trade interviews, trade

sources

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DISTRIBUTION SYSTEMS

Singapore imports a large majority of its organic food and beverages products, and direct importers distribute directly to restaurants, hotels, department stores, supermarkets and speciality stores etc. Supermarkets Customers are able to purchase a great variety of products from various countries in supermarkets at a competitive price. Supermarkets often have segregated rows which separate food products by countries which help the customer to find the products easily and also promotes the specialities from each country. Currently, many supermarkets also have a space dedicated to organic products as there is slow but increasing interest in organic food products, free-from products, products which have health benefits, and products which are healthier with less sodium, less sugar and so on. Supermarkets also have their own private labels for organic food. One example is NTUC FairPrice which has its own private label called Origins which sources and imports organic packaged shelf-stable food like quinoa, seeds, oats and more from various countries like Thailand, Australia, USA and so on. The products under Origins are stocked in all NTUC Fairprice outlets and have been successful in scaling to be distributed to other supermarket chains too. Specialty Stores Due to the relatively small market for organic food, many speciality stores have an import license and import from foreign brands through their own channels. Hence, these stores are very selective about the brands they bring in. These stores focus strongly on marketing the labels which they have selected and often specialise in certain types of produce like organic meat. Online Retail Some customers may purchase packaged food online, especially for a shelf-stable products. Many brick-and-mortar supermarkets and speciality stores have also set up online stores to complement their sales in order to draw customers who prefer a hassle-free experience in purchasing food. However, the number of customers purchasing food online is not increasing at a rate which may threaten brick-and-mortar stores, hence it is still crucial for importers to draw customers to their shop fronts in order to increase sales.

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USEFUL INFORMATION AND FOOD REGULATIONS

Key Government Authorities

The Agri-Food and Veterinary Authority of Singapore (AVA) (http://www.ava.gov.sg) is the national

regulatory authority for food. AVA ensures the safety of all food from production to just before retail.

The AVA facilitates imports and exports for the agricultural, fisheries, and veterinary industries.

Singapore Customs (https://www.customs.gov.sg/) – a department under the Ministry of Finance – is

the lead agency for trade facilitation and revenue enforcement. All goods imported into Singapore are

regulated under the Customs Act, the Goods and Services Tax (GST) Act and the Regulation of Imports

and Exports Act.

Free Trade Agreements

There is no Free Trade Agreement between Italy and Singapore.

Singapore is not part of the EUR1 trade agreement held between EU and other countries.

Food Regulations

With the AVA, companies are expected to adhere to the the import requirements and procedures for

bringing food products into Singapore.

Step 1: Apply for a trader’s licence or register with AVA

Step 2: Comply with relevant food legislation

In Singapore, there are no separate HS Codes for organic food and beverages. Hence, for declaration of

HS Codes, please refer to the guidelines according to the product type regardless of whether the

product is organic or not.

Each food and beverage product type may have specific regulations to be adhered to. Please refer to the

following documents for more details:

• Sale of Food Act: http://www.ava.gov.sg/docs/default-source/legislation/sale-of-food-

act/51web_saleoffoodact1.pdf?sfvrsn=2

• Food Regulations: http://www.ava.gov.sg/docs/default-source/e-

service/food/2web_foodregulations_1august2013.pdf?sfvrsn=2

Specific Certifications for Organic Food

For organic food and beverage products, the AVA Circular - FOOD (AMENDMENT) REGULATIONS 2016

(https://www.ava.gov.sg/docs/default-source/default-document-library/circular-on-food-(amdt)-regns-

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2016.pdf) has declared that it is a requirement that food products labelled as “organic” (or similar

terms) must be certified as organic under an inspection and certification system that complies with the

Codex Guidelines for the Production, Processing, Labelling and Marketing of Organically Produced

Foods, GL 32-1999 (http://www.fao.org/fao-who-codexalimentarius/sh-

proxy/en/?lnk=1&url=https%253A%252F%252Fworkspace.fao.org%252Fsites%252Fcodex%252FStandar

ds%252FCAC%2BGL%2B32-1999%252Fcxg_032e.pdf); or similar.

Step 3: Meet AVA's conditions for specific types of food

Importers of food and beverages should also maintain regulated source documentation and produce

them when requested by AVA officers. The following are some examples of regulated source documents

that AVA accepts as documentary proof:

• Certificate of HACCP (Hazard Analysis Critical Control Point)

• Certificate of GMP (Good Manufacturing Practices)

• Health Certificate (issued by competent food or veterinary authority of exporting country

• Attestation of export (issued by competent food or veterinary authority of exporting country)

• Factory license (issued by regulatory authority of the exporting country)

Food Additives: Before you import any food or food product, you must ensure that all food additives

and ingredients included in your product are permitted under AVA’s Food Regulations.

Please see: http://www.ava.gov.sg/docs/default-source/default-document-library/food-additives-

under-fr-(incl-new-additives-under-fd-amdt-regn-2016).pdf?sfvrsn=0

Step 4: Satisfy AVA’s labelling requirements

For detailed labelling instructions, please refer to Labelling Guidelines for Food Importers &

Manufacturers: http://www.ava.gov.sg/explore-by-sections/food/labelling-packaging-

information/labelling-guidelines-for-food-importers-manufacturers

For Specific labelling requirements for food and beverages, please refer to this document:

http://www.ava.gov.sg/docs/default-source/tools-and-resources/resources-for-

businesses/aguidetofoodlabellingandadvertisementsversionjuly2.pdf?sfvrsn=2

Step 5: Apply for an import permit

After complying with all pre-import requirements, you need to apply for an import permit through the TradeXchange system. For more information on the application of an import permit, see the Singapore

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Customs page on TradeNet: https://www.customs.gov.sg/about-us/national-single-window/tradenet/what-you-need-to-know-about-tradenet

Step 6: Food Inspection

All food consignments are subject to inspection. Some samples may also be taken by AVA for laboratory

analysis.

You are advised to make an online booking through the AVA Inspection & Laboratory e-Services for the

inspection: https://ifast.ava.gov.sg/eserviceweb

What you need for the inspection:

Prepare the following to present to the AVA inspector during the inspection:

• your Cargo Clearance Permit,

• any relevant documents, e.g. invoices and health certificates, and

• the consignment of food for inspection (for frozen raw meat, 1 carton is to be surface thawed

before the inspection)

For more details, please refer to the detailed guidelines: http://www.ava.gov.sg/explore-by-

sections/food/bringing-food-into-singapore-and-exporting/commercial-food-imports

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INFORMATION ON CUSTOMS AND EXCISE DUTIES

Import Procedures and Requirements

Firstly, with the Singapore Customs, please follow the Quick Guide for Importers:

https://www.customs.gov.sg/businesses/importing-goods/quick-guide-for-importers

Step 1: Register for UEN and Activate Customs Account Step 2: Check if Your Goods are Controlled Step 3: Register for Inter-Bank GIRO Account Step 4: Furnish Security Step 5: Apply for Customs Import Permit Step 6: Prepare Documents for Cargo Clearance Step 7: Retain your Trade Documents

Customs Duties and Excise Duties

For import procedures, please refer to the Singapore customs guidelines:

https://www.customs.gov.sg/businesses/importing-goods/import-procedures.

Food and beverages products except for intoxicating alcohols are non-dutiable and incur GST only. GST

is levied at 7% of the CIF (cost, insurance and freight) value, which includes duties (if it is a dutiable

good) and other charges, costs and expenses incidental to the sale and delivery of the goods into

Singapore, whether or not shown on the invoice.

More information on the CIF can be found here: https://www.customs.gov.sg/businesses/valuation-

duties-taxes--fees/establishing-customs-value-for-imports/establishing-the-customs-value#CIF

For intoxicating alcohols, they are classified as dutiable goods. Examples of calculation are:

1. Intoxicating liquors

a) For alcoholic products with duty rates based on per litre of alcohol

Duties payable = Total quantity in litres x Customs and/or excise duty rate x Percentage of alcoholic strength

Company A imports 75 litres of stout with alcoholic strength of 5%. Assuming the customs and excise duties for stout is S$16 and S$60 per litre of alcohol respectively:

As both customs and excise duties are levied on the import of stout,

the duties payable = 75 x (S$16 + 60) x 5% = S$285

b) For alcoholic products with duty rates based on dutiable content (weight/volume)

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Duties payable = Total dutiable quantity in kilogrammes x Customs duty rate

If 1 kilogramme of alcoholic composite concentrates contains 0.2 kilogramme of powdered alcohol,

the duties payable** = 0.2kg x S$113 = S$22.60

Here is a brief list of duty rates for wines and spirits, the complete list can be found on:

https://www.customs.gov.sg/businesses/valuation-duties-taxes--fees/duties-and-dutiable-goods/list-of-

dutiable-goods

List of Dutiable Goods Last updated on 20 Feb 2017

HS Code Product Description

Duty Rates

Customs Duty Excise Duty

22030010 Stout or porter $16.00 per litre of alcohol

$60.00 per litre of alcohol*

22030090 Other beer including ale $16.00 per litre of alcohol

$60.00 per litre of alcohol*

22041000 Sparkling wine Nil $88.00 per litre of alcohol*

22042111 Wine of fresh grapes not over 15% alcoholic in containers of 2l or less

Nil $88.00 per litre of alcohol*

22042113 Wine of fresh grapes over 15% but not over 23% alcoholic in containers of 2l or less

Nil $88.00 per litre of alcohol*

22042114 Wine of fresh grapes over 23% alcoholic in containers of 2l or less

Nil $88.00 per litre of alcohol*

22042911 Wine of fresh grapes not over 15% alcoholic in containers of more than 2l

Nil $88.00 per litre of alcohol*

22042913 Wine of fresh grapes over 15% but not over 23% alcoholic in containers of more than 2l

Nil $88.00 per litre of alcohol*

22042914 Wine of fresh grapes over 23% alcoholic in containers of more than 2l

Nil $88.00 per litre of alcohol*

22060010 Cider & perry Nil $60.00 per litre of alcohol*

22085000 Gin & geneva Nil $88.00 per litre of alcohol*

22086000 Vodka Nil $88.00 per litre of alcohol*

22087000 Liqueurs & cordials Nil $88.00 per litre of alcohol*

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CONTACT INFORMATION

Singapore Customs 55 Newton Road #10-01, Revenue House, Singapore 307987 Tel: +65 6355 2000 Fax: +65 6250 8663 https://www.customs.gov.sg/ Agri-Food & Veterinary Authority of Singapore (AVA) JEM Office Tower, 52 Jurong Gateway Road, #14-01, Singapore 608550 Tel: +65 6805 2992 Fax: +65 6334 1831 http://www.ava.gov.sg/ Singapore Business Federation 160 Robinson Rd , #06-01 SBF Center, Singapore 068914 Tel: +65 6827 6828 http://www.sbf.org.sg/ Key Trade Shows in Singapore Food and Hotel Asia (FHA) 2018 Tel: +65 6233 6638 http://www.foodnhotelasia.com/

Per informazioni e approfondimenti rivolgersi a:

ITALIAN TRADE COMMISSION6, TEMASEK BOULEVARD Suite 07 - 03 SUNTEC TOWER 4038986 SINGAPORE

singapore@ice.it

T +65 68203180

ICE - Agenzia per la promozione all’estero e l’internazionalizzazione dlle imprese italianeUfficio Agroalimentare e ViniVia Liszt, 21 - 00144 Roma

agro.alimentari@ice.itagroindustria@ice.it

T 06 5992 6551