The Chinese Wheel Of Fortune
The world’s most famous discounter, Wal-Mart, is riding on the good wheel of fortune, winning many extra dollars amidst inflation and higher costs of living. With sales rising 2.4 percent, including a 2.2 percent gain at Wal-Mart US and a 3.6 percent increase at Sam’s Club, results have exceeded Wall Street’s expectations, according to MarketWatch. Eduardo Castro-Wright, Wal-Mart US president and CEO said, “Highly competitive pricing, especially on basics throughout the store, is driving these results. Customers see that we are broadening the price gap against our competitors.”
Besides Wal-Mart’s price conscious, belt-tightening customers in the US, there is another potential that could prove a lot more profitable – China. Besides being the world’s largest factory, it continues to share the global limelight, this time by being a consumer market with fortunes to spend.”
China exported US$3.32 billion in agricultural products in August 2008, recording a drop of US$310 million over the previous month. Imports, on the other hand, totalled US$5.66 billion, up US$100 million from July 2008. This figure posts a year-on-year increase of 44.7 percent, or US$1.75 billion. Altogether, China consumed US$40.01 billion of imported agricultural products, which is a rise of 57 percent.
The country also has a growing middle class of increasingly discerning consumers who are demanding more out of want than need. These would have to be fulfilled through imports, especially when fine dining restaurants and luxury hotels have mushroomed throughout the country’s major cities. With the government reducing or abolishing import tax on several food products, the country is an extremely lucrative export destination for manufacturers around the world. (Read more on pages 22-25.)
But this does not imply that the Chinese market can be easily penetrated by sub-standard imports. The state media of China said that it has rejected over 2,700 batches of tainted imported food and cosmetics up to July this year. Dairy imports, 4,300 pounds of six kinds of cheeses, from the US, were found to contain too much Coliform bacteria, a commonly-used bacteria, reported China Daily.
In addition, Chinese regulations prohibit international companies from selling directly into China; all products must go through local importers and distributors, said Brendan Jennings, General Manager of China International Exhibitions Ltd (CIE). CIE organises the FHC China, which offers a showing of international exhibitors keen to export to China.
Food Export International will be at FHC China as well with a booth, number 1X33, near the Ice Cream Theatre. We look forward to hearing your thoughts on the Chinese (or world) market, and sharing season greetings with you. To other readers whom we do not get to see: Have A Food-Ful New Year!
Malaysia: According to a Business Times article, Malaysia is still a favourite for the food processing industry as it is cost-competitive, even though it is a net importer of food products.
The country had a net deficit of RM8.2 billion (US$2.3 billion) on its trade in food products in 2007. Malaysian Industrial Development Authority (MIDA) chairman Tan Sri Zainal Abidin Sulong revealed that value of imports totalled RM 19.4 billion while the value of exports was at RM 11.2 billion. Major food imports were cereal and dairy products.
Some RM 1.5 billion of investments were approved, of which 48.1 percent came from foreign sources such as Singapore and Thailand. An emerging sector within the food processing industry is the Halal food products, identified to be a growth driver under Malaysia’s Third Industrial Master Plan (2006-2020).
Zainal said, “Malaysia, which has strong credentials as a Muslim nation, coupled with its well-developed infrastructure and competitive edge, is well positioned to be the global hub for the promotion, distribution and production of Halal food products. In addition, Malaysia’s certification of Halal food products is also globally recognised.”
Malaysian entrepreneurs were encouraged to consider joint ventures with foreign food manufacturers to serve the global Muslim market of about two billion people.
The Agriculture and Agro-based Industry Ministry expressed confidence in achieving its target of 10,000 agro-based entrepreneurs by 2010. Thus far, the ministry has 7,850 agro-entrepreneurs under its National Agro Entrepreneurs Development Programme launched by Prime Minister Datuk Seri Abdullah Ahmad Badawi in 2006. Of the 7,850 agro-entrepreneurs, 7,024 were new entrants and the remaining 826 were existing players.
“We look forward to see contributions from the agro-based industry to the economy grow to RM2.46 billion worth of sales by the end of 2010, from RM250 million in 2006,” P S Muhammed Shariffudeen Mohd Farouk, principal assistant secretary in the agro-based industry division, said.
Kuala Lumpur, Malaysia: Malaysia urgently needs to implement quick and effective certification and laboratorytesting (lab) procedures as many face the risk of going out of business, said leader of the Malaysian democratic party (MCA), Datuk Dr Chua Soi Lek. Since the recent melamine-tainted dairy scandal in China, this industry’s exports have plummeted 50 percent within a few months, he added in a report by The Star. Before the melamine dairy scare in China, the country exported RM 600 million worth of biscuits annually. Now, even domestic consumption has decreased by up to 40 percent, he continued.
Chua has had a discussion with the Health Minister Datuk Liow Tiong Lai, saying that the ministry should issue a name list of safe-to-consume manufacturers as a form of assurance to consumers and trade buyers. Secondly, he encouraged the ministry to issue export assurance certificates to these manufacturers who ship their products overseas. This is necessary even though melamine in biscuits should not be associated with the poisonous milk in China, Chua added in a report by The Sun. But this would take more time than the fast declining industry has luxury for, given that in Malaysia, some five weeks are required for labs to issue a letter of clearance. Chua said that similar tests in Singapore would take only two days. In response, Liow pointed out that the ministry does accept melamine-content tests conducted in Singapore labs, as long as they were done through the liquid chromatography double mass method.
Korea: The Food and Drug Administration of Korea now requires all food companies to specify if their products contain genetically modified organisms (GMO), reported KBS World News. Soybean sauces and cooking oils are now required to do so as well; they were previously exempted, as it is difficult to check the amount of GMO in the finished product.
Food companies have fought back, calling for the strengthened rules to be postponed, claiming that such labelling would “mislead” consumers to believe that GMO food items are hazardous to their health.
Cebu, Philippines: On November 5, the 15th Asian Conference on Food and Nutrition Safety, held in Philippines and attended by food experts from 17 countries, addressed issues on food safety, nutrition and water supply.
Leticia Barbara Gutierrez, Director of the Bureau of Food and Drugs, in her keynote address cited the need for a more scientific system for ensuring food safety. “The traditional system cannot respond to the different challenges of food safety assurance with the increasing demand to ensure affordable and accessible nutritious food for the growing population,” Gutierrez said to the Manila Bulletin.
“Apparently, there must be a transition to risk analysis and risk assessment based on scientific knowledge,” she said.
The focus on food safety is amplified by the recent melamine scare. Chen Junshi, director of the Chinese Centre for Disease Control said the melamine scare emphasized the “utmost importance of risk communication and international collaboration.”
Gutierrez shared during the conference that the Philippines is working with the World Health Organisation (WHO) and the Food and Agriculture Organization (FAO) to ensure food safety in the country.
The initiatives being developed with WHO and FAO include the establishment of more effective and more efficient food control system; expansion of risk analysis and risk assessment use consistent with international requirements; heightened vigorous inspection and certification of food establishments and processes; updating food safety policies, standards and regulation responsive to current technological developments, emerging hazards, consumer demands and new requirements for trade; and facilitation of information sharing with other food regulatory agencies and research institutions.
The International Life Sciences Institute and the Food and Nutrition Research Institute of the Department of Science and Technology organized the conference.
Philippines: San Miguel Corp, Philippines’ largest beverage, food and packaging conglomerate, is looking to diversify its portfolio and has expressed a keen interest PT Bumi Resources, an Indonesian mining firm. Ramon Ang confirmed the company’s interest in acquiring at least 51 percent of the firm in a text message, reported Philippine Daily Inquirer.
San Miguel has also said that it is considering an alliance with Indonesia’s PT Bakrie & Brothers to secure its bid for PT Bumi. Northstar Pacific, an investment group, has also expressed its interest in buying 35 percent stake from PT Bakrie & Brothers.
To buy only 35 percent of PT Bumi f rom PT Bakrie, it is estimated by stockbrokerage firm Campos Lanuza & Co that San Miguel needs to spend P67 billion (US$1.35 billion) which might hurt its balance sheet. In addition San Miguel will spend P27 billion to buy into power retailer Manila Electric Co (Meralco).
“Our view is that management will be prudent with cash,” Campos Lanuza wrote. “To recall, San Miguel plans to spin off some of its assets and that should raise some more for these new investments.”
The food and beverage company has also announced plans to diversify into high-growth industries such as mining, infrastructure and property development, investing about $750 million in new businesses.
Net profit of San Miguel Corp increased from P7.01 billion to P20.9 billion year-on-year in the first nine months of 2008. Figures include gains from the sale of Australian units National Foods Ltd., J Boag, and Sons Pte Ltd.
Bangkok, Thailand: Following the spate of discoveries of melamine-tainted products, sales of dairy products processed in Thailand has declined by about 28 percent, according to Yuthasak Supasorn, director of National Food Institute (NFI). Annual sales fell from BHT 32.5 billion
(US$0.94 billion) to BHT 23.5 billion since consumers have been wary about melamine contamination.
Supasorn said that the Thai government agencies, such as the Public Health Ministry’s Food and Drug Administration, have been conducting checks on suspected products as well as overseeing food production processes. The NFI, an independent agency, targets to inspect the raw materials of 20 major dairy and milk product plants in Thailand before inspecting bakery and wheat-based products and plants. The agency is able to inspect 10 plants daily.
He also added that the melaminescare from China is a good opportunity for Thailand to increase its exports, which total between BHT 5-6 billion yearly. Thailand’s biggest importer, Japan, imports about 60 percent of its demand from Thailand and thus, represents opportunities to boost trade. Other potential markets should also be considered.
Thailand: The Secretary-General of the Chaipattana Foundation, Sumeth Tantivejjakul, has commented that Thailand’s recent developments have not been in the spirit of His Majesty the King’s teachings of respecting the land, geography, society and culture of the work site. He criticised Thailand for abandoning the plentiful natural resources and manpower which supports the agricultural sector for industrialism with its accompanying foreign technology, funding and its damaging environmental effects.
He also encouraged the Thai people to recognise this capability to be self-sufficient and abandon the consumerism attitude. According to him, the sufficiency economy philosophy reduces excess consumerism behaviour as it is based on nature and morality and can be applied to all levels of work.
The Secretary-General recommended the Royal Initiatives Discovery Project to citizens to understand the King’s teachings and use them to better the nation.
Brunei: A briefing on Halal certificate application for restaurant and convenience shop management was held at the Seri Begawan Religious Teachers College University in the capital, concerning how to register Halal products and how to apply for the certificate in Brunei, reported Bornei Bulletin.
Before the briefing, Dato Seri Setia Hj Awang Abd Rahman bin Pehin Khatib Abdullah, Head of Halal Food Control Unit at Syariah Affairs Department of Brunei Darussalam, said, “In line with the Halal Certificate Order and Halal Label 2005, that was enforced on August 1, in three stages, the first stage was the Halal Brunei Expo, which was held on August 14 and was specifically open to all participating food entrepreneurs.”
The second stage is opened to the general public on September 1 and the final stage is opened to those managing restaurants and convenience shops on December 1. According to the Halal Certificate Order 2005, the public can apply regardless of their religion, as long as they can follow the stipulated
criteria by the Order.
Managers of restaurants and convenience shops were briefed about the Order regarding having at least two Halal food supervisors that are acknowledged by the Islamic Religious Council at any time in the location.
These supervisors must be Muslim and well versed with the Halal-Haram substances. It is their responsibility in controlling and preparing the products, including cooking ingredients and utensils. Should Haram products touch any utensils or tools used in food preparation, it must be cleaned immediately with the proper procedures that have been laid out under the ‘Piawai Brunei Darussalam PBD 24:2006’ concerning Halal food.
The supervisors are to work only in premises they registered for and not at any other branches without approval. The briefing also emphasized that Halal supervisors must prepare, sell or serve Halal Products only. Any dubious consumable must be determined by the Halal food supervisor and are not allowed into premises of registered locations.
Personnel from Halal Food Control Unit at the Syariah Affairs Department and Agriculture Department carried out the briefing.
Colombo, Sri Lanka: Milk food importers are to display chemical compositions, including melamine, of milk products to help consumers in making decisions. This was President Mahinda Rajapaksa’s bid to increase indigenous food production and safeguard people’s health, according to the Presidential Media Unit.
The local newspaper, Daily News, reported that the directive was a result of a meeting with delegates from the Mawbima Lanka Foundation to discuss food issues. During this meeting, food safety problems due to various chemicals in food items were discussed at length, leading to the President promising the government’s action in safeguarding children’s health.
Other topics brought up were programmes to encourage milk consumption, incentives for the local dairy farmers, protection of local industries and increasing competition in the local markets.
Vietnam: Local confectioners have seen an increase in business since the melamine scandal broke out, reported Thai News Service. Domestic market share has risen while that of their Chinese counterparts has fallen.
As consumers lose confidence in Chinese products, they turn to the local confectioners for substitutes. Owner of Thanh Long confectioners, Pham Thi Ngoc Thuy, has reported a 50 percent increase in orders from supermarkets and wholesalers to provide confectionery for the coming Lunar New Year, also known as Tet.
The upcoming Tet festival has the food companies preparing to increase production capacity and even more so, as orders rise with consumers turning their back on Chinese products.
Deputy general director of the Bibica confectionery company, Phan Van Thien, has earlier said the company was facing difficult times competing with Chinese confectioners, but now thought that local producers could succeed if they paid due to attention to quality and hygiene.
Taiwan: Global Insight Daily Analysis reported a declining inflationary pressure in Taiwan for the third straight month because of falling energy prices. According to official data released, consumer price index (CPI) rose by 2.4 percent in October compared to a 3.1 percent rise in September. Food inflation continues to be the main driving force in price increase, gaining 5.5 percent in annual terms and 5.6 percent in September.
The core CPI that excludes volatile vegetable, fruit and energy prices rose 2.9 percent in annual terms, while the wholesale price index (WPI) gained 2.4 percent in October, a two-and-a-half year all time low. It is expected that inflation will continue to decelerate in the near future as energy and commodity prices continue to fall, lowering costs of related items.
Food supply constraints loosen as the weather turn for the better, easing high food prices. Coupled with falling demand resulted from the
recent economic crunch, prices are set to fall.
Taipei, Taiwan: Central News Agency reported a food safety agreement made between China and Taiwan to improve bilateral communication on food safety, protecting consumers’ health and also victims’ rights to demand compensation.
“With the agreement, the Chinese authorities have the obligation to provide information to us and demand enterprises (that produce tainted food products) to cope with disputes, “Department of Health (DOH) Minister Yeh Ching-chuan said at a press conference. He added that the government will help victims in claiming compensation with the semi-official Straits Exchange Foundation (SEF) open for applications for compensation with the assistance of its Chinese counterpart, the Association for Relations Across the Taiwan Straits (ARATS).
According to Yeh, Taiwan’s strict checks on imported food will be extended to the source of the food production in China. A food and drug administration is also to be expected in the near future. Both China and Taiwan are allowed to take measures such as information exchanges, export and production suspensions and immediate recalls of tainted foods in the event of important food safety incidents.
Investigations and action plans should be provided by the country in which food safety violations originate. Corporation will be provided when either country wishes to conduct on-the-spot investigations.
The agreement came into effect in November.
Hong Kong: A battle of criticism has started over how pork prices are determined in Hong Kong, The Standard reported. Although the average wholesale price of live pigs in October was HK$10.40 per catty (US$1.34), more than 23 percent less than HK$13.6 per catty in January, retail prices are higher than before. Price savings were not passed down to consumers as retailers claim that operating costs have increased. Accusations of retailers engaging in price fixing were refuted in a Consumer Council report, which did not find any “direct evidence of restrictive practices or abuse of market power that hindered the competitive environment of the live-pig trade.”
Secretary for Food and Health York Chow Yat-Ngok commented that a free market should determine food prices, two weeks after fresh-meat retailers hit back at the government’s accusation of unfair competition. He also said, “Food prices should be determined by the free market. What the administration can do is to improve market transparency and enhance market efficiency so as to help consumers make a wise decision.”
Fung, claiming that Chow had “not further investigated or proved what the main cause of the volatile pork retail price is”, rebutted this comment. “I think the government is not sincere in trying to solve the problem.” In addition, Fung faulted the monitoring process of the auction pig market as insufficient as there was still aggressive bidding by some pig buyers.
Fung’s comments provoked the ire of the Pork Traders General Association of Hong Kong deputy chairman Hui Wai - kin who deemed them “unreasonable’’. “There have been price adjustments since the wholesale price has stabilised, but a spontaneous cut or increase in retail prices is not possible. The legislators and officers have not studied clearly how the sector works. I am disappointed as their calls are totally unreasonable,’’ Hui said, adding that the retail price of pork has dropped 30 percent from HK$50 to around HK$36 per catty since July.
The pork market is facing uncertainty due to the melamine scare in the recent months. Supply was slashed,resulting in wholesale price increasing, as mainland pigs are to be tested. Retail prices remained stable at around HK$36 per catty.
The Consumer Council has said it will disclose the prices of goods in wet markets next week in order to increase transparency.
Hong Kong: Strong government support was shown for issuing new ice-cream hawkers with 17 district councils in Hong Kong backing the move upon consultation. Only Sha Tin District Council has yet to be consulted. No new licenses were issued since 1993.
The administration is reviewing its management of hawkers in general, according to the South China Morning
Post, but incumbent hawkers are pushing the government to issue new licenses for people wanting to join the industry and allow close relatives to inherit their licenses.
This news is welcomed by Cheung Chee-hung, chairman of the Diary Products Beverage and Food Industries Employees Union, who demanded that the government delay the deadline for hawkers to apply for HK$30,000 (US$3,871) in compensation for their licenses. “The deadline was first set at the end of December last year, but the government extended it upon our request to the end of December this year. We hope the government can extend it again, because we want to wait for the consultation report to be completed before making our decision,” he said.
According to Cheung, the youngest ice-cream hawker is 53 and the union hopes for more young people to join the trade.
Hong Kong: Consumers would be glad to know that fresh fish sold in Hong Kong has cleared the melamine tests. The fish samples sent to the Centre for Food Safety mostly came from the mainland, with the exception of fresh salmon from Norway. The mainland fish, various species of carp, eel, bass, grouper, tilapia, edible goldfish, grey mullet, freshwater bream and catfish, came from Zhongshan, Zhuhai , Shunde and Panyu.
The melamine scare has shaken consumers’ confidence in mainland food products as the contamination originated from cases of children developing kidney stones after drinking tainted milk. Melamine is a toxic industrial chemical used in plastic and glue manufacturing, added by food producers to increase protein content.
China: The state media of China said that it has rejected over 2,700 batches of tainted imported food and cosmetics up to July this year as it coped with its own food safety issues.
Dairy imports, 4,300 pounds of six kinds of cheeses, from the US were found to contain too much coliform bacteria, a commonly-used bacteria, indicator of the sanitary quality of foods, reported China Daily.
Ausnutria, an Australian firm, baby milk formula was also rejected as it contained a potentially deadly bacterium, according to China Daily, which quoted China’s quality watchdog. The bacterium can cause fatal infections in infants but no cases have been reported yet. Ausnutria was unavailable for comment.
Beijing, China: Xinhua reported that Foreign Ministry spokesperson, Qin Gang, stressed the importance of Sino-US relations to China and his willingness to work with the new US Administration to promote the continuous development of Sino-US relations.
His comments came about when interviewed on Obama’s successful election and on Sino-US relations during a regular news conference. “The development of healthy and stable relations between China, the largest developing country in the world, and the United States, a developed country, not only accords with the fundamental interests of the two countries and two peoples but is also conducive to world peace and stability as well as to the well-being of the people the world over.” Qin Gang said.
The spokesperson also mentioned that he hoped China and the US will “continue to strengthen exchange and dialogue” in the midst of the global challenges in terms of economic, energy security, climate change, antiterrorism and food security.
On the Six-Party talks, Qin Gang summed up the importance placed on the bilateral relations. ” It is our belief that no matter which political party takes over the government and no matter who enters the White House, there is consensus on this question. We hope the process of the Six-Party Talks will continue moving forward and achieving positive results through the efforts of the various parties.”
Texas, Canada: Whole Foods Market, a Texas-based leading retailer of natural and organic food, has sold a 17 percent stake to Green Equity Investors, a private equity firm, for US$425 million. According to The New York Times, this is a “much-needed vote of confidence” for Whole Foods after the company posted an extremely poor performance in fourth-quarter earnings.
Green Equity Investors is an affiliate of Los Angeles-based Leonard Green & Partners.
‘’We view it as a strong vote of confidence in our business model and our long-term growth prospects despite the tough current economic environment,’’ said John P. Mackey, co-founder and chief executive of Whole Foods, in a call with investors. ‘’This equity infusion, combined with our strong cash flow from operations, gives us the financial flexibility to manage through these difficult economic times.’’
The announcement is obviously much welcomed as the stocks soared by 20 percent its release. The company’s stock has fallen more than 70 percent since the beginning of 2008. Profit for the quarter was $1.5 million, compared with $34 million a year ago. One of the reasons for the profit decrease is the costs associated with its merger with Wild Oats Markets, lease terminations and other charges.
Whole Foods was previously doing extremely well, registering doubledigit growth. However, as traditional grocery stores started to offer organic and natural foods, more discounts and private-label merchandise, its sales has started to decline.
‘’We believe our core customers remain committed to Whole Foods,’’ Mackey said. ‘’However, the unrelenting negative economic news appears to be shifting buying behavior to making fewer trips and to making more value-conscious decisions.’’
United Kingdom: Consumers are finally getting a break from the rising food price inflation that has plagued the world for the recent couple of years, according to The Daily Mail. The British Retail Consortium (BRC) reported a reduction of annual food price inflation of 1.6 percent from 9.1 percent in September to 7.5 percent in October.
The reduction in prices is a bid on the supermarkets to help consumers cope with the increasing prices through significant price cuts, and urged oil and energy giants to do likewise to reduce utilities bills. Director-general Stephen Robertson said, “With oil and wheat prices 30 per cent down on a year ago, and the battle on for every pound customers have to spend, retailers are rushing to pass the benefits on.” All the more so, with the Christmas season looming up the horizon, retailer competition is stiffening in the battle for consumers’ expenses.
Fiona Moriarty, director of the Scottish Retail Consortium, pointed out that the issue at hand is to decide on the extent of interest rates cut to boost expenditure. It was revealed that disposable income fell by nearly 30 percent since 2006. With rising energy and consumer prices coupled with lack of credit facilities, the average household is left with only 25 percent of its monthly income as disposable income.
United Kingdom: According to The Times Newspapers, the price war between Britain’s big five supermarkets have lowered food inflation to its lowest level for five months.
Associated British Foods, one of Britain’s biggest food producers, commented that inflationary pressure from higher priced commodities such as wheat and corn oil is no longer significant, or even present.
Growers claim that the lower prices are due to the supermarkets’ aggressive price-cutting, focused on key staples such as milk and potatoes. Marks & Spencer has also adopted this strategy, lowering prices of 530 food products by about 10 percent of its range.
United Kingdom: In the midst of the economic maelstrom, credit rating agency Moody’s moved Marks & Spencer (M&S) outlook from stable to negative.
The credit rating downgrade could make it more difficult, not to mention expensive, for M&S to borrow cash. The agency released a statement stating that ‘Given the expected weakening in operating performance this year, the outlook is unlikely to be stabilised in the current fiscal year.’
M&S has pointed out concerns over its fashion and food sector, having suffered profit slumps of 34 percent in first half profits resulted from the consumer spending slowdown. The retail giant has unrolled a series of cost cutting measures, which includes investing less in its stores estate and reducing share buybacks. Moody’s, however, expects more of M&S to take other measures to restrain discretionary expenses as required’.
United Kingdom: Dairy Crest, dairy group, has announced plans to transfer the milk collection operations in order to cut costs and improve margins. It will be shifted from its Davidstow creamery to Devon-based Gregory Distribution starting from December 1, according to Just-Food.com. Staff members will also be transferred to Gregory with the same term and conditions.
“We are trying not to pass rising input costs onto consumers and are reviewing all our operations with a view to cutting production costs,” the spokesperson who gave the comment to Just-Food.com said.
Dairy Crest said that it is committed to reducing costs in order to allow continued investment in the business. Service to milk supplies will be unaffected.
London, United Kingdom: A new chairwoman for the Council of Food Policy Advisers has been announced. Hilary Benn, the Secretary of State for Environment, Food and Rural Affairs, has asked Dame Suzi Leather to take up the post although it is unpaid. Leather’s current position as the Chair of Charity Commission remains unaffected. In a news release by Benn’s department, Hilary Benn commented on Leather’s suitability as she “has a long interest in food policy and brings with her a wealth of experience of leading high profile public bodies such as the Food Standards Agency and the School Food Trust.”
According to Hilary Benn, this council will be set up for two years though it will be reviewed after 18 months to see if a more permanent body is necessary. Her focus for the Council is on “the practical policies needed to maintain UK and global food security and the long term sustainability of the food chain, following on from the recommendations on food made by the Prime Minister’s Strategy Unit Report.” The Council is also recruiting members of the Council with the appointment process and selection criteria posted on the Defra website.
United Kingdom: Associated British Foods (ABF), a diversified international food, retail and ingredients group, announced a jump in sales and earnings from its grocery business leading to increased annual profits, as reported on Just-Food.com.
The UK food group reported an increase in operating profit from its grocery division from 26.8 percent to GBP 194 million (US$305.9 million) during 2008 to September. Sales also increased by 24.9 percent to GBP 3.25 billion, boosting revenue and profits across the group.
Chief executive George Weston said acquisitions, rising volumes and success in pushing through price increases had driven the growth from ABF’s grocery business. “Profit was ahead 27 percent as a result of the substantial improvement at Allied Bakeries and good growth from Twinings, Ovaltine, Westmill and milling and baking in Australia.”
Weston said ABF’s results demonstrated the “resilience” of the group and added that the company was “committed” to further expansion, particularly of its sugar business and its discount clothing retail arm Primark.
Ireland: Ireland proposed labeling the country of origin of products such as poultry, pork and lamb as consumers call for information regarding food miles, freshness and product quality. However, the European Commission has been less than supportive of this proposal because it is against existing labeling legislation for the EU.
Agriculture Minister Brendan Smith stated, “I see no valid reason why this information should be withheld as long as there is no interference with the free operation of the market. As well as the information deficit, there is also the problem of a false impression of origin being created by selective labeling practices,” he said. The lack of origin information on competing imports was cited as a reason for the closure of Irish poultry processing plants.
Ireland proposed a national legislation that would require the origin to be included on labels of poultry, pork and sheep meat and on products containing 70 percent or more of these meats, which was frowned upon by the Commission. “The general view among member states, as well as the commission, is that a single harmonised regime should apply and that individual countries cannot go it alone,” he said.
The Commission has plans to consolidate and upgrade the food labeling legislation, according to Smith. At the moment, the proposal does not require compulsory country of origin labeling. “These views are also known by the Department of Health and Children who will take them into account in the course of discussions on the new proposals in Brussels, in the course of which we will continue to pursue our ambitions regarding country of origin labeling,” he said.
Brussels, EU: Calls for Europe to increase the size of food labels rose as the nutritional information required by consumers cannot be fitted on it. All the more important is that this problem affects the smallest portions of products that do most to discourage obesity.
“The problem is a combination of the amount of information nutritional labeling laws requires us to carry, and the fact that the Commission now says the print size on the packs must at least 3mm font size,” explained Susanne Doring, Director of Consumer Information for the Confederation of the food and drink industries of the EU (CIAA). She demonstrated with a Nestle cream tin can, that if the new nutritional labeling laws are applied, the label would increase to twice its original size from 45mm to 90mm, which is twice the height of the can itself.
Doring said, “It is no good if you then enforce information which is too big to fit on the smaller-sized food containers. More flexibility is needed to enable the food and drink industry to provide additional voluntary information, and any new legislation must take account of the space constraints on smaller packs.” She called the proposal “impractical and a burden for manufacturers.”
Steve Leroy, External Communications Director, of Coca-Cola Europe, agreed. He displayed the Coca-Cola Lite label after applying the new rules, showing bigger wording that is squashed together and difficult to read. The company logo also has to be reduced to fit into the label. He said: “In this case the label still fits the product, but despite the larger type size it becomes confusing to read and we don’t believe this is helpful when a successful voluntary labeling system is already in place and working well.”
The CIAA is calling for the rejection of a one-size-fits-all EU policy, explaining that rigid print size requirements are unsuitable for smaller packaging. She added, “What we want is the development of labeling guidelines to foster EU harmonisation in relation to food information, including the continuation of our current voluntary agreement, which requires only that the wording on food labeling must be ‘legible’.
The Commission’s proposal was published 10 months ago but is now under intense negotiation in the European Parliament.
Brussels, EU: The European Parliament proposed agrochemical restrictions which includes tougher controls on pesticides, insecticides, herbicides and fungicides usage, in a bid to reduce pesticide usage by 85 percent by 2013 to limit the harmful effects of the chemicals to the environment and health.
This was met with dismay and objection from farmers as such restrictions could lead to huge food price increases, doubling the cost of vegetables. Restrictions on what the farmers can use to fight common diseases and pests could reduce the amount of agriculture produced, causing supply limitations, which leads to price increases. Research by Cranfield University in Britain reported a possible 10 percent increase on the annual rate of inflation.
The EU says the proposal will be negotiated and discussed before the EU’s council of agriculture ministers make a final decision in 2009.
Prague, Czech Republic: The global economic slowdown has led to disinflationary pressures as demand for Czech goods fall, leading the Czech Central Bank to cut interest rates by 75 basis points, from 3.5 percent to 2.75 percent, in a bid to boost the economy. Zdenek Tuma, the Central Bank’s governor, said at a press conference that “overall risks to the Central Bank’s outlook are disinflationary” and that the global economy is cooling faster than expected.
The policy was approved on the same day as European, U.K and Swiss central banks cut their interest rates sharply. Analysts at London-based firm, Capital Economics, said that among central European countries, the Czech economy is most affected by the weakened Western Europe and low demand in countries like Germany will negatively affect the export-oriented Czech economy. Tuma commented that the central bank does not intend to maintain a specific difference between the European Central Bank and the Czech central bank since “We aren’t in the Euro zone and our interest rates continue to develop independently”.
The central bank’s forecasts have been less than positive with slowing overall price growth due to falling commodity prices and slower-than-expected growth in food prices. The Koruna’s volatility is also considered “both an upside and downside risk to the inflation outlook,” according to Tuma. He also added that it is impossible to forecast which direction the monetary policy board could move interest rates at its next meeting, citing extreme market volatility and sharp swings in the koruna’s exchange rate.
The Czech Ministry of Finance was well aware of the Koruna’s volatility and its possible impact on the state budget, Tuma said.
Paris, France: Reuters reported that Danone has prepared itself for a slow 2009, as the key emerging markets that it relied upon as growth drivers are showing indications of slowing down. Co-Chief Operating Officer Emmanuel Faber has commented during a group investor seminar that it would be “a global slowdown, not just in developed countries.” The company was set to feel the impact in Russia, Mexico, Brazil, Indonesia, Argentina and China, Faber said.
The slowdown in emerging economies has already caused many to reduce their performance expectations. Danone stated that it still expects 8-10 percent like-for-like sales growth and an improvement in its operating margin over the medium term. However, this is a few percentage points short of its medium-term guidance next year.
Faber also revealed that the company has faced a 40 percent increase in milk powder cost in the last two years. Though rise in costs are likely to stop, it will not decline until the end of next year at the earliest.
The marker of Evian bottled water has also indicated that volume and sales from the bottled water in the French and UK markets are still declining. “We will remain in a phase of transition before we can rediscover growth in those two countries in terms of bottled water,” Faber said.
Salinas, CA: Monterey Gourmet Foods, an American-based manufacturer and marketer of fresh gourmet refrigerated food products, reported a fall in net revenues comparing third quarter 2008 to third quarter 2007. Revenue fell from US$24.5 million to US$23.2 million while gross margin fell from 25.5 percent to 27.1 percent. The balance sheet looks healthy as cash from operations generated US$3.7 million, cash and cash equivalents reaching US$3.4 million, backed by a credit facility of US$5 million fully available at the quarter end.
Scott Wheeler, Monterey Gourmet Foods’ CFO, said, “Our balance sheet has a solid cash position and carries no debt, so we have the flexibility necessary to continue to act on growth initiatives. In addition, in the fourth quarter we expect the costs of freight and raw materials to decrease, in particular flour, olive oil and pine nuts. Nonetheless, we are stalwart in our focus on controlling costs and this week we aggressively reduced ongoing expenses. We believe this approach will improve our fourth quarter results.” The company has also estimated a reduction of US$1.2 million in its annual costs run rate with a series of cost cutting plans such as shutting down its delivery system at Sonoma Foods, reducing its salaried workforce by 10 percent, cutting down on variable culinary support and restructured outside selling support.
Eric Eddings, President and CEO of Monterey Gourmet Foods, explained the decrease in sales as a result of a large club channel customer delaying orders. However, he remained optimistic about subsequent quarters’ performance, citing that the customer has indicated increased fourth quarter orders and an increase in the volume of orders. In addition, the company has plans to expand their portfolio of products and channels. Eddings also announced a joint-vendor agreement with a major customer, which will drive “top-line sales beginning next quarter.”
“In addition, we are excited to receive our approved occupancy permit for our new Kent facility in Washington early November. We designed this flexible footprint, state-of-the-art facility to improve productivity, deliver cost savings and quickly accommodate new varieties and expanded capacity needs for new products and new business opportunities.”
Eddings concluded, “We know the economic pressures on our end consumers and expect continued challenges in the consumer market place. We believe the key to maintaining strength in such an environment is to anticipate the volatility, implement aggressive cost saving measures and enhance selling strategies to address the opportunities that are inherently embedded in these conditions. With that in mind, we have further adjusted our cost structure and continue to evaluate new product initiatives carefully. This quarter, we began to offer family varieties to discerning home cooks seeking to provide a gourmet experience with creative choices and the freshest ingredients in value packages.”
New York, US: Wendy’s/Arby’s Group Inc. announced third quarter losses due to consumer sales decline and costs associated with Arby’s buying over Wendy’s.
Arby’s is operated by Triarc Co Inc, which is run by billionaire investor Nelson Peltz. Arby’s completed the acquisition of the hamburger chain Wendy’s in September. Peltz is now a board member at Wendy’s/Arby’s.
Wendy’s posted a loss of US$29.85 million, a dismal figure compared to a profit of US$29.9 million a year ago. The results include the US$68.5 million associated with the takeover. The Dublin-based company has lost out to the likes of Burger King Corp. and McDonald’s Corp in the recent years due to poor branding. In a bid to improve sales, it is emphasizing on its quality food and value offerings.
Triarc also recorded a loss of US$12.1 million; a poor performance compared to a profit of US$3.7 million the previous year. The company blamed competitors’ discounting for its own sales decline, as aggressive pricing is used as a strategy to bid for consumers’ dollar in the recent economic downturn.
The Peltz-ran private equity fund, Trian Fun Management L.P, has begun a partial tender offer to buy up to 40 million shares of Wendy’s/Arby’s stock for US$4.15 per share, a 26 percent premium from the closing price the day before the announcement. If successful, Trian will increase their ownership of the stock from 11 to 20 percent. The offer expires at midnight on December 5, 2008.
New York, US: Retailers have been suffering from poor consumer confidence due to the credit crunch, posting less-than-expected sales figures and losses. However, Wal-Mart stands to gain from its discounter position, with sales rising 2.4 percent, including a 2.2 percent gain at Wal-Mart US and a 3.6 percent increase at Sam’s Club; results that have exceeded Wall Street’s expectations, according to MarketWatch.
Eduardo Castro-Wright, Wal-Mart US president and chief executive officer said, “Highly competitive pricing, especially on basics throughout the store, is driving these results. Customers see that we are broadening the price gap against our competitors.”
However, the discounter is still embarking on further price discounts over the next couple of months, projecting savings of an addition $200 million for shoppers. According to a note issued by UBS analysts Neil Currie and Roxanne Meyer, “Consumables was about the only category that continues to draw traffic to the discounters.” Such heavy discounting by Wal-Mart may put more pressure on competitors during the coming holiday season.
South Florida, US: According to News Press, the Food and Agriculture Organisation of the United Nations (FAO) said in the latest issue of its “Food Outlook”, a bi-annual commodity publication, that world cereal production is expected to hit a new high in 2008 as high prices facilitated planting coupled with good weather. The record harvest is forecasted to meet demands in the short run and replenish the global stocks.
However, FAO has warned of the current financial crisis hurting the agricultural sectors globally. “This year’s record cereal harvest and the recent fall in food prices should, therefore, not create a false sense of security,” said Concepcion Calpe, one of the report’s main authors.
“For example, if the current price volatility and liquidity conditions prevail in 2008/09, plantings and output could be affected to such an extent that a new price surge might take place in 2009/10, unleashing even more severe food crises than those experienced recently,” Calpe said.
Calpe explained that the financial crisis has caused greater uncertainty for future prospects leading to producers “adopting very conservative planting decisions”. The current rise in wheat output is mainly attributed to developed countries, where farmers are more able to respond to high prices. Developing countries, however, faced supply side constraints.
The high food inflation has resulted in more undernourished people globally, reaching the 923 million mark. Despite the lower commodity prices, retail prices have yet to be decrease significantly. Together with the dismal global economic outlook, more people “will have to reduce their food intake and the number of hungry could rise further,” Calpe said.
The report highlighted the difficulties that the agriculture sector is facing, such as land and water constraints, low investments in rural infrastructure and agricultural research, expensive agricultural inputs relative to farm-gate prices, and little adaptation to climate change.
With a growing population, mostly in developing countries and urban areas, the productivity of a shrinking rural work force will have to increase through agricultural, physical capital, better training and more efficient supply chains.
New York, US: The New York Times published an article about the Korean government marketing its cuisine globally as a strategy for trade. According to Inchul Kim, a Korean consul in Boston, the government is “approaching this thing from the perspective of trade. One of the government policies is to get a wider market for agricultural products and food.” The government has announced plans to increase the number of Korean eateries abroad to 40,000 in the next 10 years.
“Food and all this stuff is tied into economics and politics,” says David Kang, a professor of government at Dartmouth College.
Korean cuisine is relatively unknown and thus, a fresh and exciting alternative to foreigners. The Korean culture has gained quite a cult following the success of Korean drama serials. The cuisine is famous for its fermented foods, matched in certain combinations for promoting health and keeping the body in balance.
Korean-Americans are driving the demand for Korean cuisine as they seek out traditional foods. Specialty food store, H Mart, is moving into Burlington as large numbers of Boston-area residents were shopping in the New Jersey branch, according to the marketing manager, Jimmy Kim. The 50,000-square-foot space will house a ‘Banchan’ section; to stock kimchi and other cooked dishes, in addition to a food court.
Gainesville, US: J&J Snack Foods posted net earnings of US$11.2 million for fourth quarter, a seven percent increase from US$10.5 million in the same quarter of fiscal 2007, according to Datamonitor. Net earnings for fiscal 2008 declined from US$32.1 million to US$27.9 million year-on-year.
Sales increased nine percent from US$162.2 million to US$177.4 million for the fourth quarter. Comparing year-onyear sales figures, it has increased from US$568.9 million to US$629.4 million, a rise of 11 percent.
Gerald Shreiber, J&J’s president and CEO, said, “As previously reported throughout the year, our earnings were impacted by higher input costs, particularly wheat and dairy based products. We are gratified that we were able to grow our overall business by 11 percent and maintain key market shares during these challenging economic times.”
Texas, US: DNV announced October 15, 2008 that Kathy Wybourn has joined the organization as Director of Food Safety Solutions. Wybourn is a 24-year veteran of the US food industry. She will run day to day operations and help lead the expansion of DNV’s food safety certification and training services.
“Kathy has the experience and the strategic vision to help us take a leadership position in US food safety services,” says Richard Stolk, president of DNV Industry North America.
Wybourn assumes operational leadership of DNV’s food safety certification business at a crucial time. The rising number of food contamination events is driving demand for wider adoption of food safety standards. In early 2008, Wal-Mart became the first nationwide US grocery chain to require suppliers to have their facilities certified to one of the internationally recognized Global Food Safety Initiative (GFSI) standards.
“This is the next step I’ve been looking for,” says Kathy Wybourn. “DNV is a stellar organization and already has a strong footprint in food safety. I’ll have tremendous resources at my disposal, including a network of local auditors and a growing portfolio of industry partnerships.”
“The big challenge right now,” adds Wybourn, “is helping food producers organize around a consistent set of standards that are recognized and shared throughout the supply chain. The market is moving so fast, and the issues so complex, that we’ll be spending a lot of time helping customers decide which standards are right for them and how to implement them cost effectively.”
Wybourn started her food career at GD Searle/Monsanto, where for 18 years she held technical and managerial positions across the organization. She received Monsanto’s President Award for implementing HACCP using safety principles and earned the Monsanto Star Performance Award for building quality assurance into contract manufacturers.
In 2005 Kathy joined the Food Products Association where she was director of SAFE Operations and managed the FPA-SAFE program. Before joining DNV, Kathy was the Director of Auditing Services for RQA, Inc. Manufacturing Services unit.
DNV is an independent and autonomous foundation working to safeguard life, property and the environment. DNV is recognized as one of the leading and most respected management systems certification bodies in the US, and has issued more than 80,000 certificates worldwide. DNV has over 8,000 employees in more than 100 countries, and is represented in the US with over 700 employees spread over more than 12 offices.
National Pride (Part I)
Launched in 1986, the SIAL d’Or awards identify and promote innovations that are commercial successes in the domestic markets of each of the 29 participating countries. SIAL d’Or 2008 sees the inclusion of a new Wine category, which will highlight and promote the innovations that have become major successes in the domestic markets of the countries represented in this flourishing sector. Each of the Country Award winners showcased their product at SIAL, which was held October 19-23, 2008.
South Africa: These frozen chicken waffles can be served after four minutes’ heating in the toaster. No additional fat needed.
Belgium: Enriched with vitamins and minerals, Coca-Cola Light Plus Vitamins provides 40 percent of the daily intake of vitamins B3, B12, C and magnesium in the form of a sugar-free drink that retains its distinctive Coca-Cola flavour.
Argentina: Composed of four main ingredients – fruit juice, yoghurt, cereals and milk – this beverage is aimed at children and is a fun way for them to consume nutritional products.
Australia: These tuna ready meals come with or without pasta and can be easily reheated in the microwave. A fork in included in the bowl.
Austria: This is an Austrian beer-flavoured cheese made based on a specific ripening process. The cheese is brushed with salty water which gives it a completely new and unique flavour.
Germany: The Milka chocolate bars with fillings feature some innovative recipes that improve on the popular desserts of the 1950s to 70’s. A more kitsch-like packaging enhances these.
Brazil: The natural soya green tea contains zero lactose, cholesterol, sugar or preservative. It is however high in preservative, proteins and vitamin C.
Canada: Maple syrup is dried and turned into flakes using a vacuum-drying process. The result is a rich tasting sweetener that is different from flavoured sugars.
Chile: The empanadas is a kind of pastry that is popular all over South America. They are ready to be served after 15 minutes of heating in the oven. The range includes three varieties: ham and cheese; spinach and cheese; and minced mean and onions.
China: The fruit flavoured yoghurt drink is made by pasteurising the fruit juice and yoghurt separately then mixed with fruit pieces to ensure optimum quality.
Denmark: The sugar-free chewing gum comes in different-flavoured soft centres. The two flavours are Strawberry & Lime; and Vanilla & Fresh Mint.
Spain: This drink consists 13.5 percent natural lemon juice with a refreshing hint of mint. It is preservative-free.
Terra: Flying e Chip Flag
Terra’s Blues and Stripes chips are made from three kinds of harvested vegetables. The tri-colour medley is made from sweet potatoes (red), blue potatoes (blue) and striped beets (stripes). They are made with no trans fat or cholesterol and contain very small amounts of saturated fat.
Dole: Peach On- e-Go
Bite-sized portions of Dole’s peaches are now available in packaged form. In plastic containers with easy peel-off lids, the product was awarded the ChefsBest Award by the American Culinary Chefs best. Dole’s Fruit Bowl is saturated fat free, low in sodium and naturally rich in vitamin C.
Golden Hope: In The Pink Of Health
Golden Hope’s Pink Guava Puree is 100 percent GM-free, allergen free, kosher and halal. It can be used in beverages, juices, ice-cream, frozen desserts, yoghurt, fruit jelly, baby food and confectionery. Produced in Perak, Malaysia, the pink guava puree is exported to Europe, US, Australia, Japan, Korea and Singapore.
MacTea: Tea Best
From Future Enterprises, Mac Tea provides instant refreshment. The teas come in a ready to drink can and are available in Lemon and Peach flavours. The tangy beverages are as healthy as convenient, with added vitamin C.
Sarhil: Easy Apricot
Hailing from China, Sarhil’s Apricots are packaged in a hygienic foil bag in portions of 100 gm. Sarhil operates out of Xinjiang in a state of the art facility to ensure that consumers receive safe and palatable products beneficent to health.
Lifeforce: Dried Fruity Delight
Lifeforce’s Dried Blueberries are grown free from pesticides and chemicals. In addition, they are sun dried in sanitary conditions. They form a valuable contribution to a healthy diet as they are low in fat, high in fibre and contain many vitamins and minerals. The range includes papayas, prunes, figs, banana chips and raisins.
Roland: Preserved Goodness
Roland’s Fancy Whole Mandarin Oranges come in a traditional canned format that is familiar to consumers. Preserving the goodness of the oranges, it provides a safe and convenient way for the whole family to enjoy their daily dose of fruit. The product is available either in water or light.
Wellpict: Oodles Of Berries
Wellpict Strawberries are picked at the perfect time, at the peak of flavour. The berry is ripe with colour and their proprietary coastal variety spends only a few hours in cooling before being shipped to market.
Eden: Been To Beans?
These Pinto Beans are grown organically in a small farm in the US. Beans are soaked overnight and cooked at Eden's certified organic and Circle K Kosher cannery. They are high in potassium and an excellent source of dietary fibre, with low fat and very low sodium with no salt added.
Kaao Sook: Instant Smiles
From Thailand’s Smiling Fish company, the Kaao Sook range offers congee in a variety of flavours. They range from Anchovy, Baby Clams, Salmon and Abalone to Gingko Nuts and Shiitake Mushroom. Truly instant, they can be served right from the cans.
Contel: To Italy
These Italian peeled tomatoes offer a taste of traditional Italy. The peeled tomatoes come in three packaged carton options. Tomato pastes are also available.
Frutzzo: Rich And Creamy
Originating from North Germany, Oldenburger’s dairy products hail from the open countryside and green fields. This Reduced Cream contains 25 percent fat, made from pure fresh cow milk. It has a rich and creamy taste and has a ring-pull for easy opening. The Evaporated and Condensed milk contain eight percent and nine percent fat respectively.
Tarrison: The Crowd Pleaser
Designed to handle large amounts of cooking, the Bubba Q from Tarrison Products is a durable piece of equipment. It is wholly constructed from stainless steel and the tubular burners are covered by a lifetime warranty. It also has a heavy duty smoke hood and a handle that promises to stay cool while the unit is in operation.
Carlisle: Serving Elegance
From Carlisle’s new range of Cateraide insulated solutions, the Slide ‘n Seal Beverage Servers glide shift and close tight without using latches. It promises to hold temperatures for a longer time and the lid seal provides for leak-proof transport. The server is available in black, brown and forest green.
Bunn: Lakes Of Co ee
The Titan is a high-volume brewing solution that features simple operation, precise extraction control and portable servers. The Dual is capable of brewing 128.7 litres of coffee per hour. Server flasks hold 12 litres of coffee and are insulated to keep coffee hot for hours.
Festive: Deliciously Displayed
The Oxford Hot Display & Bain Marie from Festive Cabinets has a standard bullnose profile. It has front and back sliding doors with side and top lights. The display cabinet has five display levels and a powder coated exterior finish. The doors can be lifted out for easy cleaning.
Hyperlux: Warm Reception
The high mirror finish Croissant Warmer from Hyperlux is an elegant way to present croissant and pastry. It has a revolving container with a dome cover for easy serving. It is heated by three to six tea-lights at the bottom. It is durable and hygienic for day-to-day use.
Skope: Putting On A Good Show
With mirrored doors for product depth and tilt-adjustable shelves, the food display cabinet from Skope is designed for optimum product presentation and ease of use. Cleaning is simple and quick thanks to removable doors, shelves and trays and coved internal corners.
Dick: Fast-In, Fast-Out
Rapid Steel knife sharpener from Dick is a simple to operate piece of equipment suited for untrained staff or enhance skilled workers’ productivity. Safe and maintenance free, it will reduce the risk of injury to workers and create a more comfortable work environment. Simply draw blade through the rods for a perfect edge.
Scholl: Comprehensive Solution
Designed for self-service, the Multifunctional Cold Servery Counter from Scholl takes the hassle out of catering cold and perishable foods. It has cough-protection made of glass to ensure visibility while protecting food from contamination. The unit is constructed from chrome nickel steel, with an optional perforated steel shelf.
Re-inventing Classics
After leaving for a stint in Tokyo, veteran Peter Tsang returns to Shang Palace in Shangri-La Hotel, Singapore as executive chef. In the newly refurbished restaurant, Tsang offers re-invented classics and advocates the use of added value products and services to improve businesses.
By Nicole Liang
The Michelin star guide finally acknowledged Asia’s culinary maestros only in 2007 and Tokyo was its first city to be featured. This is by far the only authoritative measure in the region since the Gault Millau guide has yet to make its way there either.
Elsewhere in Asia, an outstanding chef is identified through his Curricula Vitae (CV) and signature dishes. With over 30 years’ experience, chef Peter Tsang’s career highlights include the honour of preparing a special menu and meeting Hong Kong’s ex-chief executive Tung Chee Hwa during his visit to Singapore in 1997, along with other state dignitaries such as Nelson Mendela and Li Peng. He has also worked in Hong Kong and Shanghai before. Today, Tsang is executive chef at Shang Palace in Singapore’s Shangri-La Hotel – a position he returned to in May 2007, after leaving it for Japan, to be culinary director at the Imperial Hotel’s Peking Chinese Restaurant.
This stint in Tokyo was more than just a fancy addition to his CV. It further elevated Tsang’s learning especially culturally, and in terms of management skills. He shared some of his experiences before coming back full circle to Shang Palace: “The Japanese are well known for the deep respect they have of their work and the effort they put into completing their tasks. One stark difference between Tokyo and places like Hong Kong and Singapore is the reverence of hierarchy. It is this strict adherence to the distinct levels that makes the difference in managing the restaurant and kitchens”.
Such a culture does not exist in Hong Kong or Singapore, Tsang added. “In Singapore, I have adopted a nurturing approach in dealing with a workforce that is somewhat educated and has less exposure to hardship”. According to him, prior to joining the hotel, employees are sent for a comprehensive training programme aimed at inculcating five core values: respect, courtesy, humility, helpfulness and sincerity.
Singapore does have its merits and advantages over others too. Tsang said that the lion city is an international trading hub so the hotel has the option and convenience of ordering supplies from any part of the world, even though most of the ingredients he uses can be found locally. “I hardly use seasonal or imported ingredients in the regular a la carte menu, unless I plan to do a specific short-term food promotion”.
What matters though, is the hygiene and quality standards of the supplies. “It is important that the hotel’s standards are first met before any order is made to ensure that what we provide to our guests is of the highest quality. In my opinion, reliability and consistent quality of the goods are the most important criteria when selecting suppliers. The best supplier I worked with was willing to deliver food products during festive seasons and even public holidays! I found this extremely useful”.
These make Tsang’s job a lot easier, and more so when the hotel is an extremely established one. Shangri-La Hotel, Singapore, is the first hotel in Singapore to achieve the Hazard Analysis Critical Control Point (HACCP) certification. Consequently, Shang Palace is also compliant of the stringent requirements stipulated in HACCP. “We also have a group wide policy known as the Shangri-La Food Safety Management System, launched in 2001, which was designed according to HACCP principles. A dedicated food hygienist in each Shangri-La hotel oversees implementation of HACCP through education, training, execution and maintenance of the programme,” Tsang added.
Given Singapore’s and its Shangri-La Hotel’s standing, it is easy to understand why Tsang agreed to come back to Shang Palace eventually. “I worked in Shangri-La Hotel, Singapore for many years, and I had strong attachments to this hotel. When I heard that Shang Palace was due to undergo a renovation and reopening, I was delighted to have the chance to return and head Shang Palace,” said Tsang.
Shang Palace went through a S$4 million refurbishment that was completed in November 2007. The interior décor now features floral motifs on the red glass ceiling and walls hand-painted by Chinese artisans. This facelift gives Tsang the perfect opportunity to react to consumers’ palates, as well as dining habits, that have changed over the years. He thus returned to offer re-invented classics as well as new dishes that are an innovative interpretation of Chinese cuisine. “Dishes on the new menu are classical Cantonese items that are given modern interpretations. This parallels Shang Palace’s new look – a new modern contemporary design, characterised by rich Chinese heritage,” he said.
This menu continues to be “new” as Tsang introduces fresh items, or creates different ‘Chef’s recommendations’, every six months. “I retain a traditional stance in terms of culinary techniques and menu planning. However, the presentation of some signature dishes and service may adopt an innovative twist.
“Take Shang Palace’s Baked Abalone Tarts for instance. They are a different take on the traditional ingredient. Instead of using the abalone in soups or stews, the abalone is cut into three pieces, and then baked as a crisp tart on top of a bed of chicken and mushroom filling. Despite the unconventional presentation, the original flavour and chewy texture of the abalone is still retained. I developed this idea from the popular egg tart.
“Another example is the Steamed Scallop and Radish knotted with String Beans. The scallops are presented in small spoon-shaped dishes laid within a square Dim Sum basket and resemble pieces of white jade from the Han dynasty”.
The reborn Shang Palace also offers some Shanghainese (including Huaiyang cuisine) and Szechuan specialties but Cantonese signature will still take up 80 percent of the menu. “Shang Palace opened its doors in 1971 and has a loyal base of Cantonese cuisine lovers over its 37-year history. We constantly recognise them for their patronage and ensure that their needs are taken care of. This ensures customer loyalty and return patronage which also translates to revenue for the hotel,” Tsang said.
In addition to the 12 signature dishes he whips up, Tsang said there are other attractions that enhance businesses at the restaurant. The outdoor scenery in the form of a Chinese garden is one of them. Coupled with great Chinese tea, it is an all-encompassing gourmet experience. With Shang Palace’s strong emphasis on tea culture, tea pairings with food is also encouraged. For instance, green teas like West Lake Long Jing are suitable with seafood, fish, salads, or chicken dishes. To promote the appreciation of Chinese tea culture, there are ready-packaged teas, teapots, Shang Palace’s signature peony teacups and saucers available for sale. Other signature items are available for sale such as homemade Shang Palace XO chilli sauce, and cashew and macadamia nuts.
Wine connoisseurs can also revel in a global assortment of wines and champagnes displayed at the wine service counter, sold by the bottle and by the glass. Some of the wines come with recommended food pairings. For example, Penley Estate Merlot, Coonawarra, can be paired with Taiwan-style Sautéed Chicken. The Hollick Cabernet Sauvignon, Coonawarra is best matched with Braised Pork Ribs and Special Mustard Sauce. An extensive menu of Chinese wines and spirits is also available.
Tsang advocates the promotion of these added value products and services in Shang Palace. “All these factors help us to attract diners who are lovers of Chinese culture and cuisine. On top of my responsibilities as Head Chef at Shang Palace, I am also expected to carry with me a business-centred mindset. This entails coming up with creative promotions that differentiate us from other restaurants offering Cantonese cuisine”.
Moreover, Tsang is also constantly working to forecast business trends and identify opportunities that not only help increase revenue but are also cost effective. “An area of concern to me would revolve around management of food costs, particularly at this time when prices have risen so high. The introduction of the Early Bird Discount for Dim Sum on weekend mornings between 10.30am to 12 noon highlights Shang Palace’s efforts in achieving greater revenue for the hotel,” he added.
The Dim Sum menu offers favourites like Siew Mai, Shanghai Pork Dumplings and Steamed Black Pepper Chicken Feet. An additional selection, available on weekends and public holidays, includes Steamed Spinach Dumplings, Boiled Pork Dumplings with Spicy Sauce and more. Business set lunches, starting from S$38++ per person, offer convenient options for corporate luncheons. This introduction, along with the Early Bird Discount promotion, has proved to be popular among discerning local diners who are attracted to the winning combination of value and five-star hotel quality food.
Other avenues for revenues include rolling out special products for various festivals. Shang Palace has monthly highlights that offer guests something unique. An example would be the current Hairy Crab promotions, which showcase the autumn delicacy from Shanghai’s Yangcheng Lake. During the recent Mid-Autumn Festival, Tsang also created a new range of traditional baked and snowskin mooncakes.
Robert After months of intensive renovation, the iconic Shang Palace has re-opened its doors on November 7, 2007 at Shangri-La Hotel, Singapore. Shang Palace’s interior décor features floral motifs on the red glass ceiling and walls hand-painted by Chinese artisans while the surrounding 15 acres of lush greenery serves as a backdrop for the restaurant’s “dining in a Chinese garden” theme.
The restaurant has a seating capacity of 154 and guests can enjoy a variety of seating arrangements, from the main dining hall to the elegant semi-private and private dining rooms, experiencing a different ambience for each occasion. The six private dining rooms are themed according to famous Chinese teas (Long Jin, Yu Hua, Shui Xian, Yin Zhen, Shou Mei and Pu’er), and are equipped with special tea service equipment that corresponds to the name. The largest, Pu’er room, can seat 16 persons at an opulent round table.
Hong Kong-based Shangri-La Hotels and Resorts currently manages 54 hotels under Shangri-La and Traders brands with a rooms inventory of over 24,000. Shangri-La hotels are five-star deluxe properties featuring extensive luxury facilities and services. Shangri-La hotels are located in Australia, mainland China, Fiji, Hong Kong, India, Indonesia, Malaysia, Philippines, Singapore, Sultanate of Oman, Taiwan, Thailand and the United Arab Emirates. The group has over 45 projects under development in Austria, Canada, mainland China, France, India, Japan, Macau, Maldives, Philippines, Qatar, Seychelles, Thailand, UAE, the UK and US.
Food Price Inflation And Oil Prices – Implications For The Food Industry
(Part I of II)
Rising costs are everywhere: food and oil prices are on a sharp upward trend. Almost all in the food business are feeling the pinch. In this article, Professor David Hughes tells of the broader effects for the industry, as well ways which businesses can hope to survive and possibly use this situation to their benefit.
By Professor David Hughes
Here are a few thoughts on food price inflation and oil price spikes and implications for the food industry. We have not seen this sort of food prices for some 30 – 35 years, it was in the 1970s that we last saw grain and oil seed prices go through the roof. We got used to thinking that food prices should be low and what’s more, declining. Reality is not so. Particularly in 2006, we saw food price inflation start to accelerate.
It reflects a number of different factors. Not least supply driven, I might say. First of all, international stocks of grains and oil seeds have been run down through the 2000s to levels that we have not seen for years. In part, this reflected a demand-pull on stocks but also a change in government policies. Governments stopped putting stock into public storage. For example, in the European Union, it ran down the grain mountain, as well as doing away with other foodstuff stockades. So we had much lower stocks than before.
There was a series of weather and disease shocks which hit global food production really hard in 2006/07. The Australian drought is still recurring now.
Global harvested acreage of grain has declined by 11 percent over the 2003 to 2004 period, although there was a growth in oil seed acreage. There was less profitability in grain, so farmers just grew less.
The decline of public sector research and development is one factor in the decline of global food productivity. There was a period in the 1960s, 70s and some of the 80s that was the ‘golden years’ for the green revolution. Subsequently, governments got out of the R&D business, not entirely but enough to make an impact. This is not to say that without public R&D funding there has been no growth in productivity. There has been some productivity increases but at a much slower rate.
It is a demand size factor here, as rapid economic growths in the developing countries have also contributed to the faster rate of consumption. Dietary shifts from cereal to meat protein, as we all know it take 1.3 billion people in China to eat one kg of meat each, particularly meat as it requires a lot of feed grain to produce, and we all feel the effects around the world.
Although, in truth the Chinese have been relatively self-sufficient in meat consumption up to now, but that is going to change as we move forward. Then, what happened over the 2006/07 period, we saw governments panicking, not least on the export side. We had export bans imposed by some countries, especially for rice. India and Vietnam for example, made a bad situation particularly worse by imposing such bans and as increase in interest of speculators mounted, we saw volatility in markets as hedge fund managers saw opportunities in the soft commodities to earn a better margin.
Probably one of the biggest impacts on food prices as we look over the last couple of years is the emergence of biofuel markets for grains and oil seeds. This has placed an enormous upward pressure on food and feed grain prices. Not least corn, is you take a third of US food production and put it into an alternative market like biofuels, then it must have a significant impact on the food and feed grain market and indeed it did.
Then, we had very strong oil prices peaking at just under US150 a barrel in May 2008. That has had an intermediate impact on costs of production, transportation, etc. It would have a much longer and significant price impact going forward.
There are implications for everyone in the food industry: to the consumer at the front-end all the way to life science companies that are in the genetics business.
For consumers, food price inflation varies depending on where you happen to be. If we look at food price inflation in Europe is running close to 10 percent, over in US and Canada it is just slightly lower. But if you are in developing countries like Kenya and many other states in Africa, food price inflation is running at 20 – 30 percent. That becomes a huge burden to the individual household when you consider that the average family there spends 60 – 70 percent of their income on food alone. That is devastating.
For consumers in emerging nations, Chinese families spend close to 30 percent of household income on food bills and food price inflation there is about 10 percent. When I visited China and spoke to consumers to see if they could handle the price hikes, they said yes they could for the moment because their incomes are going up as well. But if other factors cause wages to falter in China, then we could see real trouble ahead as there will be a collapse in demand for many food products that are now starting to develop a market in China.
So, the best solution to high food prices, really, is high food prices. At these prices, farmers will be motivated to produce more. But, will these gains flow to farmers in the developing world? Or will their governments decide to tax the farmers and take some of the premiums associated with high food prices?
If they do (increases taxes on farmers), it will work against the natural supply response. In developed countries, we will see an expansion in production. In fact we are already seeing this happen in the US and Europe, in some cases we will expansion into marginal lands. Historically speaking, these lands are marginal for good reason: because they produce less predictable yields than the ones in use now.
Although we have high farm prices, costs are also very high. For example in the UK, there has been a 50 percent increase in cereal farming costs over the last three years, driven by higher energy prices, amongst other things. Commodity markets too, are becoming increasingly volatile, not least because of speculative activity. This trend is set to continue and the clear implication here is risk management. Questions of ‘when do we sell?’, ‘when do we buy?’, ‘can we forward-price?’, ‘can we handle sudden spikes in prices?’ all become increasingly important to farms and companies engaged in production. These will be questions that all businesses will have to tussle with.
Higher prices are still to come for meat in particular, although there has been kicks up for beef and sheep meat and at last for pork in the last few months. What I am interested are the years around 2015, where there will be a battle for the relatively cheap protein meats. It is going to be a fight between industrially produced chicken and industrially produced (aquaculture) fish. If one looks to the degree to which industrially produced chicken and industrially produced fish can convert feed grain into meat, the yield is astonishing in relation in other meats such as beef. Chicken is 1:1.5 in terms of food to feed ratio, fish is even better at 1:1.2. It will be a big tussle in the bottom end of protein meat market and if I were in the meat industry, I would want to be as far as possible from the war unless I am the lowest-cost producer.
It is a real squeeze too, for everyone else in the food industry and it is a painful process. Not least because most of us have to deal with powerful food retailers who have been used to squeezing suppliers and seeing food prices decline year-on-year. Look at the Tescos and Wal-marts of the world and their promises of cheaper food every year, as if that is the natural order of things. That is not to be but in the meantime, they can hold their way when three or four major retailers have something like 70 percent of the grocery market share in many countries. They do have significant market power and they will use that but in the end, the market will breakthrough. And it is interesting because in inflationary times, retailers learn that retailing can in fact be very profitable. Not least in terms of inventory benefits that they will get where they would have sold the product four times before paying for it. So, inflationary times could be good times for better retailers.
In the immediate term, what I see for the UK is a real challenge for those in the premium product business. When household budgets are squeezed and money is tight then those who buy the products from retail shelves will start to ask more difficult questions of the products that they buy. If its premium, they will ask, ‘Why is it premium?’ They are happy to have a treat to be able to buy premium food products but only if there is genuine value, so they will be asking to be convinced into paying real value instead of just fancy packaging. I think this will be the challenge for those in the premium products business.
On the retail front in the UK, the hard discounters are the ones experiencing the most growth. Companies like Aldi, Lidl and Netto are seeing market share growth. Also, main line retailers that have a special promise on price like Asda, Wal-mart and Morrisons of this world. That is putting additional pressure on broad scale retailers like Tesco and Sainsbury, forcing them to focus their attention on price which will make it more difficult for everyone else.
What about the capacity to suddenly increase supply to bring a better balance between demand and supply? Well, as I mentioned, in the past such research efforts were funded by the governments pumping cash into improving yields and making crops disease resistant. This source of funding has now been replaced by private sector money, led my life sciences. However, they will want to see the benefits of their investment accrue more benefits for their own stakeholders rather than see the effects trickle down to consumers. So while we might see a technological response and supply will rise in the medium term, it may not be at prices that we used to see in the past.
Dr. David Hughes is Emeritus Professor of Food Marketing at Imperial College London, and Visiting Professor at the University of Kent Business School and at the Royal Agricultural College, U.K. David is a much sought-after speaker at international conferences and seminars on global food industry issues, particularly consumer trends, and is a strong proponent of building vertical alliances between key chain members in the food industry – farmers, life science and input companies, ingredient firms, food and beverage manufacturers, retailers and food service. He has lived and worked in Europe, North America, the Caribbean, Africa and South East Asia. David has extensive experience as an international advisory board member with food companies and organisations in three continents. Currently he is a Non-Executive Director of KGG – a U.K. farmer-owned berry fruit business (US$260 million turnover in 2006) with a blue chip customer portfolio; and on the Advisory Board of Rabobank, UK. He works closely with senior management of food and beverage firms on business strategy development and with governments on food policy formulation.
The Aroma Of Success
Founded in 1999, Cia. Organica has achieved great success in Brazil as a producer of premium high quality organic coffee. Exporting to important organic market overseas which includes Holland, Japan and the US, its founder Paolo Vilela aims to conquer other markets but intends to do it step by step using a very effective ‘word-of-mouth’ methodology, as well as a strategic partnership.
By Azrina Abdul Karim
After 20 years as a musician, Paolo Vilela never imagined that he would take over the family business. Inheriting his grandfather’s coffee plantation in northern Paraná, Brazil, Vilela knew he could not turn away as livelihoods were at stake. The centuries-old Boa Esperança Farm located in the city of Ribeirão Claro had been damaged by frost the previous year. Therefore, Villela had to find a way to implement a recovery programme; however, he did not intend to continue with the conventional way of planting coffee.
Traditionally, coffee in Latin America were grown within a mixed shade cover of fruit trees and other hardwood species, which, Adriana Valencia of World Resources Institute, an environmental think tank based in the US, writes “together form a forest-like agroecosystem”. However, as coffee farmers migrate towards an intensive farming system which, Valencia adds, involves “high-yielding coffee varieties grown with no shade and high applications of chemical fertilizers and pesticides”, a variety of environmental and social repercussions have been observed. This “sun coffee conversion” exposed farm workers to high levels of harmful pesticides.
Vilela recalled, “As a kid, I watched coffee growers fall sick, poisoned by pesticide.” He did not want to enter into an industry that would harm humans AND the environment; but he could not disregard his inheritance. Therefore, he decided to try something different: organic coffee farming. From his research, which was conducted mainly on the internet, Vilela discovered that he can produce high quality coffee via organic farming methods.
The transition from conventional to organic coffee farming is not immediate and requires a few years of soil preparation, as well as intensive manual labour and substantial financial investment in new cultivation techniques and fertilization methods. “It took three years to purify the land,” Vilela said. The farm uses coffee peels and natural fertilizers (at least 50 trucks per year at US$ 300 per truck) to enrich the soil. “My family thought I was crazy,” he added in amusement. The former jingle writer, however, believes that it’s important “to do something that you really believe in.” Thus, Cia. Organica was born.
Rich in aroma and flavour, the Cia. Organica brand of organic coffee are produced only from bright red cherries that are harvested by hand and sundried on suspended terraces to avoid the humidity of the soil which can affect its taste though fermentation and contamination. Cia. Organica is described as having a full-bodied flavour which is “at the same time mild and extremely agreeable, with low levels of acidity and notably sweet”.
Organic farming is a holistic venture, which goes beyond soil nourishment, legislation and certification. It also involves protecting the environment, wild animals and natural resources, as well as caring for the labourers that work the land and keeping their children in school. Going a step beyond organics, Cia.Organica coffee has also been certified as a ‘Demeter’ product which means it has been produced according to the principles of Biodynamic Agriculture.
Created in 1925 by the German pedagogue Rudolph Steiner, Demeter-certified products is produced “without the use of synthetic fertilizers, pesticides, herbicides or hormones” by farmers who aim to “re-establish an ethical, spiritual relationship with the soil, the plants, the animals, the human beings and the cosmos”.
Paolo Vilela said his most effective marketing method is by “word of mouth”. In 2002, he introduced his brand of organic coffee by conducting coffee-tastings in supermarkets. If he could create a jingle, it would revolve around this theme: I taste it, I like it, I buy it!
Cia.Organica first entered the overseas market in 2003 by marketing its products in Holland. The response was very encouraging as the Dutch, basically, value quality. Therefore, quality comes before organic. Needless to say, Cia.Organica passed the ‘quality control’ test. “People buy because it’s better than what they have tasted before,” Villela said.
In 2005, the company entered the Middle Eastern market through Dubai. Other markets include Japan, US and Korea. Vilela said Australia will be their next target market.
The company prefers the step-by-step approach. “We don’t want to grow too fast,” he explained. Apart from Holland, the European market is, currently, not on the company’s most important list of export markets. “Europe,” he said, “is a closed market for specialty coffee.”
In May this year, Paolo Vilela established a partnership with Thiago and Fernando Fontoura, great-grandchildren of coffee planters from the coffee-producing region of Minas Gerais. The Fontoura’s plantations in Grama and Ibiá possess the capacity to produce over 30,000 bags of coffee per year.
With passion for coffee as the basis of their partnership, Vilela and the Fontouras aim to explore other avenues in food production through research into new markets and methodologies under ‘BemdaTerra’. Hoping to build an “agricultural scenario that will be a
model for the world”, the partners are idealistic in their outlook, confident in the values of organic farming and a strong belief that Brazil has “an enormous gift for agriculture”.
A twist of fate gave birth to Cia.Organica, but a prudent business strategy may propel the brand to a much higher level. Although Vilela may say “What is life? It’s not just to make money”; the aroma of success, however, is as seductive as a cup of high quality brew. With this new partnership, expansion is inevitable. Vilela’s “wish to do something different” may one day put his brand of organic coffee, not just in Dubai or Sydney, but probably in every major city around the world.
Culinary Pedigree
Chef Jean-Michel Lorain has received numerous honours throughout his career in recognition of his know-how in fine cuisine. In 2004, Chef Lorain successfully re-captured the third Michelin star for his family’s establishment, The Côte Saint Jacques in Paris, France. In 1993, he was named Chef of the year by Gault-Millau He was recently invited by The Crown Macau to demonstrate his expertise as part of World & Gourmet Asia from November 5 – 8, 2008. Food Export, International speaks to the three Michelin starred chef about his management style.
By Ong Hong Tat
Literally born into the gastronomic world, the Chef inherited the love of cooking from his parents, Chefs Jacqueline and Michel Lorain. In the beginning of his career, Chef Jean-Michel Lorain earned his stripes through apprenticeships with the masters, including Troisgros, Girardet and at the Taillevent restaurant. In 1983, Chef Lorain returned to his family’s establishment, The Côte Saint Jacques to work with his father.
The father-son partnership was a successful one: three years after joining the Côte Saint Jacques in 1986, it was awarded its third Michelin star. In 1993, Gault-Millau named Chef Lorain as Chef of the year. The Gault-Millau is a French guide to the finest gastronomic establishments in France and awards points from one to 20 in its ratings. Chef Lorain scored an impressive 19.5 points of the possible 20 for his work at The Côte Saint Jacques.
Of all the awards he has won, the Chef says that regaining the third Michelin star was the most memorable. “The third Michelin star in 2004 was clearly a defining moment. My father received the third star in 1986 and I kept it after he retired until 2001. From 2001, it was my challenge to recover it by myself without his help. I did that in 2004, some three years later, and it is really my greatest souvenir,” said Lorain.
Preferring to concentrate on his own restaurant, Lorain seldom ventures out of France to cook. However, accepting Crown Macau’s invitation was an easy decision. “I heard a lot of good things about Wine & Gourmet Asia in Macau as well as positive comments from their previous guest chef, Alain Passard, who happens to be a friend of mine. I don’t do many promotions like this outside of France because I like to choose a place where I know I will have the best conditions to work and demonstrate my cuisine. After my experience in Macau, I can now say that I made the right decision. It was a great experience to have had the opportunity to work in the Crown,” said Lorain.
Managing the kitchen well at The Côte Saint Jacques is a combination of skills, not just culinary. Like any other Chef, Lorain plans the menus, sources for ingredients, works in the kitchen and manages his staff. Like military drill, everyone and everything must work together seamlessly to produce the desired outcome.
At The Côte Saint Jacques, the menu varies according to the seasons. This approach gives Lorain a plethora of ingredients to work with, complementing the Chef’s dedication to creating food with creativity. “My menu changes every three or four months. I try to keep a good balance between the different types of produce and meats. In my menu, you will likely find meat, fish and vegetables. Especially vegetables, I devote a large part of the menu to the seasonal greens which are very important to me. From the ingredients I have chosen, I will work on my menu with a focus on creativity. This [creative aspect] of cooking is another thing that I hold in high regard when it comes to my cooking,” said Lorain. In order to exercise his creative leanings, Lorain has learnt the importance of relation-building with his suppliers. A chef is limited by the ingredients that he is able to find. “For one part, especially for the vegetables, herbs and salads, I keep very strong ties with those suppliers. For other products, I have a lot of suppliers all over France. It is necessary to source nationwide because some regions are strong in producing some type of ingredient, while others are good for something else. For example, I try to use fish from Britanny, lamb and foie gras from south-western France and chicken meat from the Bresse region. Having the best produce to cook with is very important,” said Lorain.
Asked to describe his style, Lorain said, “My cooking is based on creativity, finding good products and then using those ingredients to their best advantage. For example, if you prepare a dish with pigeon or veal or a vegetable, you want the product to retain its own flavour, whether it is expressed purely or against a backdrop of originality. My own cooking style is quite pure. I don’t like complicated things: I prefer instead to bring together two or three ingredients and to highlight the particular qualities of each one.”
After the menu is planned and the ingredients are ready, Lorain has to execute. Unlike other chefs who may rule with an iron fist, Lorain’s management style in the kitchen focuses squarely on resolving problems without being overly bearish. “For good management in the kitchen, you must be a model for your cooks and do everything that they do well. I try to show the right way every day when I am working. I also spend a lot of time on training my staff and teaching them better techniques. This way, they learn and kitchen operations will become more efficient. I am not really v
