Required Report - public distribution

**Date:** 5/14/2004

**GAIN Report Number:** RP4024

RP4024

**Philippines**

**Food Processing Ingredients Sector**

**Philippine Food Processing Ingredients Sector**

**2004**

**Approved by:**

![](media/image1.wmf)Michael D. Woolsey

FAS MANILA

**Prepared by:**

Patrick F. Quianzon

**Report Highlights:**

The Philippine food processing industry continues to expand, with total
sales exceeding \$10 billion/year. The United States is a top supplier
of ingredients to Philippine manufacturers, although competition from
other foreign suppliers has intensified. Major imported food ingredients
include: wheat, dairy products such as milk and whey powders, processed
fruits and vegetables, beef and beef products, and nuts. Continued
strong demand for basic food ingredients is forecast fueled by a rapidly
growing population and limited supplies of locally produced inputs.
Sales of costly ingredients will continue sluggish due to persistent
price sensitivity in the Philippine food and beverage market.

Includes PSD Changes: No

Includes Trade Matrix: No

Annual Report

Manila \[RP1\]

\[RP\]

Table of Contents

[**Market Summary 3**](#market-summary)

[Road Map for Market Entry 4](#road-map-for-market-entry)

[A. Entry Strategy 4](#a.-entry-strategy)

[B. Market Structure 4](#b.-market-structure)

[C. Company Profiles 5](#c.-company-profiles)

[D. Industry Trends 6](#d.-industry-trends)

[Competition 8](#competition)

[**Best Product Prospects 10**](#best-product-prospects)

[A. Products Present in the Market That Have Good Sales Potential
10](#a.-products-present-in-the-market-that-have-good-sales-potential)

[B. Products Not Present in Significant Quantities but Which Have Good
Sales Potential
10](#b.-products-not-present-in-significant-quantities-but-which-have-good-sales-potential)

[Post Contact and Further Information
10](#post-contact-and-further-information)

# Market Summary

There are close to 5,000 food and beverage manufacturers in the
Philippines, with gross receipts totaling \$10.4 billion in 1998, the
most recent data available. Most sales are by a small number of large
locally-owned companies, such as San Miguel, RFM, and Universal Robina
and multinationals, led by Nestle and Del Monte. Top sectors include:
bakery, coconut, confectionery, dairy products and eggs, grain milling,
processed meat and fish, processed fruits and vegetables, milled and
refined sugar, vegetable/animal oils and fats.

Overall, Philippine manufacturers continue to face numerous challenges
in producing and marketing processed foods and beverages in the
Philippines. High electricity costs (highest in Asia) and other
production expenses, outdated equipment and facilities, and gaps in the
cold chain are major constraints. Large well-financed companies that
have made needed investments are overcoming these challenges and meeting
growing demand for new, better-quality and competitively priced
processed foods and beverages. However, most establishments are poorly
equipped small and medium-sized processors who continue to struggle.

Demand for imported ingredients is strong since the tropical Philippine
climate limits production of many agricultural products. When available,
local supplies are often hampered by inefficient post-harvest and
storage facilities and costly farm-to-market transport, which often
drive prices higher than world market. The local supply situation means
manufacturers must look overseas for many inputs. Major imported food
ingredients include: wheat, dairy products such as milk and cheese
powders and whey, processed fruits and vegetables, and beef and beef
products. Expensive specialty ingredients, such as exotic dried fruits
and nuts, and items marketed as "organic" or "natural", are still small
niche items due to persistent and pervasive price sensitivity in the
Philippine food and beverage market.

Rising demand for processed foods and beverages is driven by a large
population of 84 million that is growing 2.3 percent annually, a food
culture that emphasizes frequent snacking, and large workforce
participation by women and resulting need for convenience foods. With
more than two-thirds of the population under the age of 30, the
Philippines is a youth-oriented food market. This fuels demand for new
and trendy products, attractive packaging, and sweetened foods and
beverages.

######## A. Advantages and Challenges for US Exporters

  ----------------------------------- -----------------------------------
  **Advantages**                      **Challenges**

  U.S. products are highly regarded   Strong competition from other
  for quality and product             exporting countries.
  consistency.                        

  Two thirds of the population is     Volatile exchange rate resulting in
  below 30 years of age and are       US ingredients becoming expensive
  heavily influenced by Western       can shift buyers' purchases to
  habits and culture through media,   source cheaper alternatives to keep
  and are observed to be very open to current market prices in a very
  processed and ready to cook, ready  price sensitive market.
  to eat and imported food products   

  Proliferation of malls and          Available supply from regional
  accompanying expansion in the       facilities licensing American
  retail and dine out establishments  brands and an abundant domestic
  especially on American franchises   supply especially on fresh
  that require American ingredients.  vegetables, poultry and seafood
                                      products.

  Market is far from saturated with   Deficient distribution and cold
  plenty of room for growth in the    chain systems in place, raise costs
  regional areas of the Philippines   and limit marketability of frozen
  with a growing middle class market. and chilled products.
  ----------------------------------- -----------------------------------

# 

# Road Map for Market Entry

## 

## A. Entry Strategy

New to market US exporters should consider the following when planning
to enter the market:

-   Filipino businessmen value interpersonal relationships and US
    exporters should work to develop and maintain close contact. Regular
    meetings with a client are appreciated and help reaffirm U.S.
    supplier commitment and support.

-   Most food processors rely on local traders or agents to supply
    necessary ingredients although there is a trend toward import
    directly, especially by large multi-product companies. While
    importing from agents is a costlier approach, Philippine agents are
    used to provide small shipments, credit terms, and manage
    importation and product quality.

-   Market is highly price-sensitive. While American products are
    usually highly regarded for their quality and product consistency,
    which gives them a certain advantage in terms of pricing premium as
    compared to competing products, consumers are extremely resistant to
    price increases.

-   Willingness to be flexible to changes in the market requirements
    like adjustments in formulations as dictated by the changing
    consumer trends.

-   Can work with one or several importers. Exclusive distributorship
    agreements are difficult to enforce in the Philippines while
    parallel imports are common.

## B. Market Structure

This diagram gives an overview of the usual distribution channel for
imported food ingredients, with a similar pattern from domestic
suppliers to the retail and HRI sector.

![](media/image2.wmf)

Large food processing companies typically prefer to buy their imported
food ingredients directly wherein they have control of the price and
quality. However, they also purchase through traders/agents whenever:

-   the quantity required is minimal

-   an ingredient is accompanied by complicated technical or quality
    issues. In these situations, sourcing through an experienced local
    agent is considered less risky.

On the output side, while most companies have their own distribution
network, especially in supplying their major accounts or the big
retailers, a considerable number use the services of a distribution
company to tap into smaller grocers and micro-retailers.

## C. Company Profiles

The following is a summary of sales by top manufacturing companies for
major processing sectors. Many companies are multi-product, have
subsidiaries or partners in the industry. Company data provided below
reflect sector-specific sales.

Production, processing and preserving of meat and meat products:

+------------------------+----------+---------+------------------------+
| Company                | Sales    | End-use | Production/Plant       |
|                        |          | C       | Location               |
|                        | (\$ 000) | hannels |                        |
+------------------------+----------+---------+------------------------+
| Pure Foods Corporation | \        | Retail  | 2 (Philippines) that   |
|                        | $310,085 |         | also processes for     |
|                        |          |         | Purefoods Hormel and   |
|                        |          |         | San Miguel Campocarne  |
+------------------------+----------+---------+------------------------+
| The Purefoods-Hormel   | 118,692  | Retail  |                        |
| Company, Inc.          |          |         |                        |
+------------------------+----------+---------+------------------------+
| RFM Corp.              | 48,663   | Retail  | 1 (Philippines)        |
+------------------------+----------+---------+------------------------+
| Genosi, Inc.           | 16,662   | HRI     | 1 (Philippines)        |
+------------------------+----------+---------+------------------------+
| San Miguel Campocarne  | 13,254   | Retail  |                        |
+------------------------+----------+---------+------------------------+

Note: Pure Foods Corporation, Purefoods-Hormel and San Miguel Campocarne
are owned by San Miguel Corporation.

Flour milling except cassava flour milling

  ------------------------ ----------- ---------- ------------------------
  Pilmico Foods Corp.      \$69,968    HRI        1 (Philippines)

  Liberty Flour Mills,     31,966      HRI        1 (Philippines)
  Inc.                                            

  Wellington Investment    28,511      HRI        1(Philippines)
  and Manufacturing Corp.                         

  Morning Star Milling     24,622      HRI        1 (Philippines)
  Corp.                                           
  ------------------------ ----------- ---------- ------------------------

Manufacturer of Chocolate and cocoa products including chocolate candies

+---------------------------+---------+-------------+-----------------+
| Novartis Consumer Health  | \       | Retail      | 1 (Philippines) |
| Philippines               | $22,913 |             |                 |
+---------------------------+---------+-------------+-----------------+
| Cocoa Specialties, Inc.   | 16,979  | Retail      | 1 (Philippines) |
+---------------------------+---------+-------------+-----------------+
| Gandour Philippines, Inc. | 4,905   | Retail      | 1 (Saudi        |
|                           |         |             | Arabia)         |
|                           |         |             |                 |
|                           |         |             | 1 (Malaysia)    |
+---------------------------+---------+-------------+-----------------+

Processing of fruit and vegetable sauces

  ----------------------------- ---------- ------------- -----------------
  Southeast Asia Food, Inc.     \$26,775   Retail        2 (Philippines)

  Heinz UFC Philippines         22,589     Retail        2 (Philippines)

  Hunt-Universal Robina Corp.   10,237     Retail        1 (Philippines)
  ----------------------------- ---------- ------------- -----------------

Note: Southeast Asia Food, Inc. and Heinz UFC Philippines are sister
companies.

Manufacture of Diary Products, n.e.c.

  ----------------------------- ---------- ------------- -----------------
  Kraft Foods Philippines       \$89,746   Retail        1 (Philippines)

  ----------------------------- ---------- ------------- -----------------

Manufacture of Butter and Cheese

  ----------------------------- ---------- -------------- -----------------
  Phil. Dairy Products Corp.    \$48,694   Retail         1 (Philippines)

  New Zealand Creamery          13,884     Retail         1 (Philippines)

  Blue Diary Corporation        3,632      HRI            1 (Philippines)
  ----------------------------- ---------- -------------- -----------------

Note: Philippine Dairy Products Corporation is also owned by San Miguel
Corporation.

Baking of bread, cakes, pastries, pies and similar perishable bakery
products

  ---------------------------- ---------- -------------- -----------------
  Goldilocks Bake Shop, Inc.   \$47,793   HRI/Retail     3 (Philippines)

  Golden Donuts, Inc.          11,469     Retail         1 (Philippines)

  Red Ribbon Bake Shop, Inc.   10,471     HRI/Retail     5 (Philippines)
  ---------------------------- ---------- -------------- -----------------

Baking of biscuits, cookies, crackers, pretzels and similar dry bakery
products

  ---------------------------- ----------- -------------- -----------------
  Monde Nissin Corporation     \$158,464   Retail         1 ( Philippines)

  Monde M.Y. San Corp.         9,149       Retail         1 (Philippines)
  ---------------------------- ----------- -------------- -----------------

Note: Monde M.Y. San Corp. is a subsidiary of Monde Nissin Corporation

Manufacture of macaroni, noodles, couscous and similar farinaceous
products

  ----------------------------- ----------- ------------ -----------------
  California Manufacturing Co.  \$139,280   Retail       3 (Philippines)

  Nissin-Universal Robina Corp. 13,813      Retail       1 (Philippines)
  ----------------------------- ----------- ------------ -----------------

Manufacture of candies (excluding chocolate candies) and chewing gum

+----------------------------+--------+-------------+-----------------+
| Wrigley Philippines, Inc.  | \$     | Retail      | 1(Philippines)  |
|                            | 28,302 |             |                 |
+----------------------------+--------+-------------+-----------------+
| SPI Corporation            | 14,303 | Retail      | 1(Philippines)  |
+----------------------------+--------+-------------+-----------------+
| Perfetti Van Melle         | 8,368  | Retail      | 1(Indonesia)    |
| Philippines, Inc.          |        |             |                 |
|                            |        |             | 1(Vietnam)      |
|                            |        |             |                 |
|                            |        |             | 1(China)        |
+----------------------------+--------+-------------+-----------------+

Manufacture of ice cream and sherbet, ice drop, ice candy and other
flavored ices

  ----------------------------- ---------- ------------- -----------------
  Selecta Wall's Inc.           \$39,618   HRI/Retail    1 (Philippines)

  ----------------------------- ---------- ------------- -----------------

Note: Selecta Wall's Inc. is also owned by RFM Corporation in a joint
venture with Unilever Philippines.

Manufacture of snack products such as corn curls, wheat crunchies and
similar products

  ----------------------------- ---------- -------------- -----------------
  Liwayway Marketing Corp.      \$16,524   Retail         3 (Philippines)

  Leslie Corporation            10,064     Retail         3 (Philippines)
  ----------------------------- ---------- -------------- -----------------

Source: [Top 7,000 Corporations 2002-2003]{.underline}

#### D. Industry Trends

Following are selected key trends affecting the food processing
industry:

**Functional foods** -- an increasing consumer awareness of how diet
affects health has pushed processors to come up with ways to address
growing interest in products promoted as "healthy". Although savoury
snacks are traditionally not considered healthy, snack food processors
have created new innovations and/or relaunched current products that
address demand for healthier options in the market. Added functional
substances are often highlighted on the product package. Examples
include snacks fortified with ingredients like pre-mix vitamins and
whey.

This shift from taste to a nutritional platform have companies betting
on the health benefits to increase the marketability of their products.
Lactose and whey usage is dominated by the infant formula industry with
still very limited usage in the snack, bakery and confectionery sectors.
Some meat processors have also repacked or launched their products to
highlight the nutritional value of their product like " High protein" or
"vitamin enriched."

**New varieties** -- rising consumer demand for more fruit varieties,
especially in baked and ice cream products that cater to the mid to high
end market, has encouraged importers to seek other lines of dehydrated
fruit ingredients like cranberries, blueberries and others in addition
to their regular tropical fruit lines. Again, this is partly a result of
a market that is looking for health benefits in the products that they
purchase. Tree nut varieties, especially those not grown in the country,
has also witnessed an increase in usage in addition to bread and ice
cream, in the food service sector, like in organic food and family and
fine dining establishments.

**New flavors** -- while cheese and barbecue is still the preferred and
popular flavor in most snack products, processors have developed and are
looking into increasing usage of other flavors like beef, sweet corn,
sour cream and onion. One company has recently come out with jalapeno,
ensalado, chicken and jamaican barbecue flavors in their crumble nut
products. New flavored milk varieties capitalized as well on the
popularity of ice cream flavors such as Ube, Vanilla, Melon and
Strawberry.

**Adapting to local tastes** -- Noodle, meat, and condiments processing
companies have expanded variants or new products that capture the
various known regional cuisines or native ingredients designed to appeal
to the local taste like adobo (pork cooked in soy sauce and vinegar),
sinigang (meat or fish stew), bulalo (beef marrow broth), calamansi
(local lime), sampaloc (tamarind base) and shrimp paste. This trend
reflects the fact that local dishes and flavors are still preferred in
most households, despite continued interest in Western-style foods.
While still a small player in the market, dried ready meals are showing
promise, including new rice porridge varieties like arroz caldo and
champorado.

**Compounding/blending** - To reach the bigger mass market and still be
cost competitive, dairy and confectionery processors are now blending
and compounding ingredients i.e. milk and whey and cocoa powder. With
this process, processors say that it still maintains the nutritional
value of the finished product at a price that is within reach by a
bigger market.

**Dietary variants** -- low or non-fat milk, low sugar spreads, sugar
free cookies; these are just some of the variants increasingly available
in the market to cater to a growing sophistication and increasing health
awareness among Filipino consumers.

**Niche marketing** -- Food manufacturers are gradually expanding
product lines, including niche products that appeal to a narrow,
typically upscale segment of the market. For example, dairy processors
have released new products that target specific market segments like a
special milk formula that promotes strength in the elderly, calcium
deficiency or osteoporosis in women and for lactose intolerant persons.
Snack processors have even come up with chicharong baboy (pork
cracklings), a popular food identified as a pulutan or food normally
consumed accompanying beer or liquor. "Delicatessen" processed meat is
being marketed to hotels and upscale establishments.

### Competition

+--------------+----------+-------------+-------------+----------------+
| Product      | 2002     | Major       | Strengths   | Advantages/    |
| Category     | import   | Supply      | in Key      | Disadvantages  |
|              | st       | Source (\$) | Supply      | of Local       |
|              | atistics |             | Countries   | Suppliers      |
+--------------+----------+-------------+-------------+----------------+
| Red meat     | 111.8 m  | India (46%) | Indian      | Shortage of    |
| (Beef and    | kilos    |             | buffalo     | supply. Most   |
| pork)        |          | Australia   | beef which  | are sold fresh |
|              | \$ 94.8  | (22%)       | is priced   | to wet markets |
|              | m(FOB)   |             | co          | and            |
|              |          | USA (1%)    | mpetitively | supermarkets   |
|              |          |             | and used    |                |
|              |          |             | for corned  |                |
|              |          |             | beef.       |                |
+--------------+----------+-------------+-------------+----------------+
| Milk and     | 144.9 m  | Aus         | Australia   | Domestic       |
| cream in     | kilos    | tralia(48%) | and New     | production is  |
| solid form   |          |             | Zealand are | very minimal   |
|              | \$ 213.4 | New         | major       | to supply      |
|              | m(FOB)   | Z           | producers   | industry       |
|              |          | ealand(40%) | of milk     | requirements.  |
|              |          |             |             |                |
|              |          | USA(5%)     |             |                |
+--------------+----------+-------------+-------------+----------------+
| Whey or      | 36 m     | USA (25%)   | USA, while  | No domestic    |
| modified     | kilos    |             | preferred   | supply         |
| whey         |          | France      | as a        | available.     |
|              | \$ 23    | (25%)       | suppliers   |                |
|              | m(FOB)   |             | has lost    |                |
|              |          | Australia   | share due   |                |
|              |          | (23%)       | to price.   |                |
+--------------+----------+-------------+-------------+----------------+
| Wheat and    | 2,585 m  | USA (57%)   | Quality,    | No domestic    |
| wheat flour  | kilos    |             | consistency | production.    |
|              |          | Canada      | and         |                |
|              | \$       | (20%)       | in-country  |                |
|              | 420.6m   |             | trade       |                |
|              | (FOB)    | India (15%) | servicing   |                |
|              |          |             | which is    |                |
|              |          |             | crucial in  |                |
|              |          |             | maintaining |                |
|              |          |             | the loyalty |                |
|              |          |             | of          |                |
|              |          |             | bu          |                |
|              |          |             | yers/users. |                |
+--------------+----------+-------------+-------------+----------------+
| Edible Nuts  | 4 m      | China (27%) | China       | No domestic    |
|              | kilos    |             | mainly      | production of  |
|              |          | USA (11%)   | supplies    | a variety of   |
|              | \$ 2.6   |             | groundnuts  | edible nuts    |
|              | m(FOB)   | Vietnam     | while the   | used by        |
|              |          | (6%)        | USA other   | bakeries, ice  |
|              |          |             | types like  | cream          |
|              |          |             | almonds,    | companies or   |
|              |          |             | pistachios, | re-packed      |
|              |          |             | macadamia,  | under a local  |
|              |          |             | etc.        | brand for the  |
|              |          |             |             | retail sector. |
+--------------+----------+-------------+-------------+----------------+
| Dried fruits | 4 m      | USA (65%)   | Raisins is  | No domestic    |
|              | kilos    |             | the major   | production of  |
|              |          | Iran (17%)  | item        | a variety of   |
|              | \$ 2.3   |             | brought in  | dried fruits   |
|              | m(FOB)   |             | under this  | used by        |
|              |          |             | category    | bakeries, ice  |
|              |          |             | both from   | cream          |
|              |          |             | the USA and | companies or   |
|              |          |             | Iran.       | re-packed      |
|              |          |             |             | under a local  |
|              |          |             |             | brand for the  |
|              |          |             |             | retail sector. |
+--------------+----------+-------------+-------------+----------------+
| Peas/beans   | 67.5 m   | China (31%) | China and   | No domestic    |
|              | kilos    |             | Australia   | production.    |
|              |          | USA (24%)   | supplies    |                |
|              | \$14.4   |             | mainly      |                |
|              | m(FOB)   | Australia   | mongo beans |                |
|              |          | (15%)       | and the USA |                |
|              |          |             | peas for    |                |
|              |          |             | processing  |                |
|              |          |             | or          |                |
|              |          |             | re-packing. |                |
+--------------+----------+-------------+-------------+----------------+
| Tomato       | 20 m     | China (46%) | Mainly      | Domestic       |
| paste/puree  | kilos    |             | tomato      | production     |
|              |          | USA (27%)   | paste is    | cannot keep up |
|              | \$9.7    |             | being       | with the       |
|              | m(FOB)   | Turkey      | imported    | volume,        |
|              |          | (17%)       | for         | consistency    |
|              |          |             | processing. | and quality    |
|              |          |             |             | required by    |
|              |          |             |             | processors.    |
+--------------+----------+-------------+-------------+----------------+
| Extracts,    | 5 m      | Ma          | Proximity   | Domestic       |
| essences,    | kilos    | laysia(49%) | to          | production     |
| concentrates |          |             | Philippines | cannot meet    |
| of coffee    | \$10     | Ind         | and pricing | demand of the  |
|              | .3m(FOB) | onesia(32%) | compete     | market.        |
|              |          |             | with other  |                |
|              |          | USA(7%)     | markets.    |                |
+--------------+----------+-------------+-------------+----------------+
| Cocoa beans, | 22.4 m   | Ind         | Proximity   | Supply cannot  |
| powder,      | kilos    | onesia(56%) | to          | meet the       |
| paste and    |          |             | Philippines | increasing     |
| butter       | \$31     | Ma          | and pricing | consumption.   |
|              | .7m(FOB) | laysia(18%) | compete     |                |
|              |          |             | with other  |                |
|              |          | USA(3%)     | markets.    |                |
+--------------+----------+-------------+-------------+----------------+
| Spices in    | 2.7 m    | Sin         | Proximity   | Mostly still   |
| bulk         | kilos    | gapore(23%) | to          | sold in        |
|              |          |             | Philippines | unpacked or    |
|              | \$3.1    | China(10%)  | and pricing | unlabelled     |
|              | m(FOB)   |             | compete     | formats in     |
|              |          | USA(10%)    | with other  | open markets.  |
|              |          |             | markets.    |                |
+--------------+----------+-------------+-------------+----------------+
| Sugar        | 63.1 m   | USA (26%)   | Technology  | While the      |
| derivatives  | kilos    |             | to obtain   | country now    |
| (lactose,    |          | China(16%)  | the         | exports sugar, |
| fructose,    | \$21     |             | required    | its does not   |
| glucose and  | .8m(FOB) | G           | spec        | have the       |
| other        |          | ermany(11%) | ifications. | technology to  |
| sugars)      |          |             |             | process sugar  |
|              |          |             |             | derivatives    |
|              |          |             |             | required by    |
|              |          |             |             | carbonated or  |
|              |          |             |             | cola           |
|              |          |             |             | companies.     |
+--------------+----------+-------------+-------------+----------------+
| Fresh/Frozen | 37 m     | USA(36%)    | The USA     | Local          |
| potatoes     | kilos    |             | mainly      | production of  |
|              |          | Aus         | supplies    | potato is      |
|              | \$13     | tralia(26%) | French      | mainly         |
|              | .8m(FOB) |             | fries for   | supplied to    |
|              |          | New         | the HRI     | chipping       |
|              |          | Z           | sector.     | companies.     |
|              |          | ealand(19%) |             |                |
+--------------+----------+-------------+-------------+----------------+
| Potato       | 2.1 m    | USA(44%)    | USA is      | Local          |
| flour/f      | kilos    |             | preferred   | production is  |
| lakes/powder |          | Nethe       | in terms of | mainly on      |
|              | \$1      | rlands(25%) | taste and   | potato powder  |
|              | .6m(FOB) |             | quality but | and starch.    |
|              |          | G           | may loss    |                |
|              |          | ermany(19%) | its lead    |                |
|              |          |             | due to      |                |
|              |          |             | price.      |                |
+--------------+----------+-------------+-------------+----------------+
| Protein      | 10.2 m   | Israel(40%) |             |                |
| concentrates | kilos    |             |             |                |
|              |          | USA(25%)    |             |                |
|              | \$10     |             |             |                |
|              | .5m(FOB) | M           |             |                |
|              |          | alaysia(9%) |             |                |
+--------------+----------+-------------+-------------+----------------+
| Cheese       | 2.3 m    | USA(54%)    | Consistency |                |
| Flavoring    | kilos    |             | and         |                |
|              |          | Canada(17%) | quality.    |                |
|              | \$5      |             |             |                |
|              | .2m(FOB) | Aus         |             |                |
|              |          | tralia(13%) |             |                |
+--------------+----------+-------------+-------------+----------------+
| Vegetables   | 59.5 m   | Ma          | Proximity   | Local          |
| fats and     | kilos    | laysia(57%) | to          | production is  |
| oils and     |          |             | Philippines | mainly on      |
| their        | \$28     | Sin         | and pricing | cooking oil    |
| fractions    | .8m(FOB) | gapore(20%) | compete     | and fats from  |
|              |          |             | with other  | coconut and    |
|              |          | USA(1%)     | markets.    | corn based     |
|              |          |             |             | products.      |
+--------------+----------+-------------+-------------+----------------+

Source: 2002 Volume and Value of Imports, Philippine National Statistics
Office

#### Best Product Prospects 

#### A. Products Present in the Market That Have Good Sales Potential

Red meat

Chicken meat

Seafoods (tuna, mackerel, squid)

Milk powder

Fresh potatoes

Potato flakes/powder

Tomato paste/puree

Cheese and barbecue powder

Tree nuts

Dehydrated fruits

Mixed fruits

Baking mixes

Dressings and spreads

Milk replacers

Pre-mixed vitamins

#### B. Products Not Present in Significant Quantities but Which Have Good Sales Potential 

Herbs and spices

Mixed vegetables

Protein concentrate

Whey powder

Other powder flavorings (sweet corn, chocolate, etc.)

Fruit flavors

Egg powder

##### Post Contact and Further Information

Agricultural Trade Office

Foreign Agricultural Service

U.S. Department of Agriculture

Embassy of the United States of America

25/F Ayala Life-FGU Building

6811 Ayala Avenue

Makati City 1203

Tel: (632) 8945379/63

Fax: (632) 8125430

Email: [ATOManila@.usda.gov]{.underline}

FAS Home Page: [www.manila.usda.gov]{.underline}

Annual and updated information on the following related industries and
commodities as reported by the Foreign Agricultural Service in Manila
can also be viewed online at
[www.fas.usda.gov](http://www.fas.usda.gov/) under FAS Attache Reports:

a.  Dairy and Products

b.  Coffee

c.  Livestock and Products

d.  Sugar

e.  HRI Food Service Sector

f.  Retail Sector

g.  Philippine Exporter Guide

Additional information can also be accessed thru the following
cooperators that have either offices in Manila or Asia-based offices
that cover the Philippine market:

Lieu Marketing Associates Pte Ltd

(ASEAN Representative of California Pistachio Commission, California
Table Grape Commission, California Tree Fruit Agreement, Florida
Department of Citrus, Pear Bureau Northwest, Raisin Administrative
Committee, United States Potato Board, Wine Institute of California,
Western United States Agricultural Trade Association, Mid-America
International Agri-Trade Council, Food Export USA-Northeast and the
Southern United States Trade Association)

Block 3 Alexandra Distripark

Unit 08-22, Pasir Panjang road

Singapore 118483

Tel: (65) 6278-3832

Fax: (65) 6278-4372

Contact: Richard Lieu

Email: [richelieu@lieumktg.com.sg]{.underline}

Pacrim Associates Ltd.

(ASEAN Representative for US Dairy Export Council)

The Regent Hotel

155 Rajadamri Road

Bangkok 10330, Thailand

Tel: (662) 251-6127

Fax: (662) 254-6913

Contact: Mr. Dan Fitzgerald, ASEAN Representative

US Meat Export Federation

#15-03 Liat Towers, 541 Orchard Road

Singapore 238881

Tel: (65) 6733-4255

Fax: (65) 6732-1977

Contact: Mr. Eric Choon, ASEAN Representative

Email: [echoon@usmef.com.sg]{.underline}

US Wheat Associates

28^th^ Floor Ayala Life FGU Center

6811 Ayala Avenue

Makati City

Philippines

Tel: (632) 8184610

Fax: (632) 8154026

Contact: Mr. Mike Spier, Country Director

Email:

USA Dry Pea and Lentil Council

c/o AgriSource Co. Ltd.

Ambassador\'s Court, No. 333 76/1

Soi Lang Suan, Ploenchit Rd, Patumwan

Bangkok, Thailand

Tel: (662) 2518655

Fax: (662) 2510390

Contact: Mr. Tim Welsh, Regional Representative

Email: <agsource@loxinfo.co.th>

American Soybean Association

Unit 1408-B Robinson's

PCIBank Tower ADB Avenue

Corner Poveda St., Ortigas Center

Pasig City, Philippines

Tel: (632) 6375384

Fax: (632) 6375388

Contact: Mr. Ted Cortes, Philippine Representative

Email: <asatcj@mozcom.com>