Mama: 15% surge in 2020 noodle market

Mama: 15% surge in 2020 noodle market

Quarantine-led demand feeds upbeat forecast

Commerce permanent secretary Boonyarit Kalayanamit (left) with Vathit Chokwatana, president of Saha Pathanapibul Plc, the distributor of Mama instant noodles.
Commerce permanent secretary Boonyarit Kalayanamit (left) with Vathit Chokwatana, president of Saha Pathanapibul Plc, the distributor of Mama instant noodles.

Sales of instant noodles are expected to surge by over 15% this year, boosted by panic buying after the coronavirus outbreak.

Vathit Chokwatana, president of Saha Pathanapibul Plc, the distributor of Mama instant noodles, said demand for noodles in sachet and cup packaging grew by 20% and 10% respectively in the first quarter.

He forecast overall sales of instant noodles to reach 22 billion baht at the end of the year, up 15.8% from last year.

Overall sales of instant noodles grew by 5.8% to 19 billion baht in 2019. Of the total, 4.8 billion baht was from cup noodles and 14.2 billion baht from other formats such as sachets.

In keeping with strong demand and to ensure food adequacy, Thai President Food Plc (TF), the maker of Mama instant noodles, increased its production capacity by 30% in March to more than 6 million packages a day.

"Demand for instant noodles in April declined slightly from previous months," Mr Vathit said. "However, sales were found to stay much higher than during the regular situation before Covid-19. We don't know how long such huge demand will last, but it is possible to see sales of Thailand's instant noodles reach 22 billion baht for the first time this year."

Mr Vathit said strong demand drove Saha Pathanapibul's food business to grow by 15% in the first quarter, while sales of non-food rose by just 2%. Total sales were up 7-8% in Q1.

In related news, the company yesterday teamed up with the Commerce Ministry and leading retailers to launch "Commerce Sale! Helping Thai People With Mama Cup."

Under the promotion, the price of Mama instant noodle cups in every flavour will be lowered to 10 baht each from 13 baht. The campaign runs until the end of May.

"This is the first time we have lowered the price of Mama cup by 23% to help consumers to survive this difficult time," Mr Vathit said.

Saha Pathanapibul is unsure whether increased demand for instant noodles will continue in the second half. As such, it will freeze investment in some areas and focus on investment in growth segments such as online business and warehousing for e-commerce.

The company will move its e-commerce warehouse from Rama III to the Rom Klao area for more efficient management and services.

"We have learned that there are many ways of efficiently working, but we never started it because we are familiar with the old ways," Mr Vathit said. "But with the deadly virus crisis, we can work via the new efficient methods. It is very challenging."

He expects the business situation to recover in the next 2-3 months, depending on the government's rehabilitation measures.

"With the government having in-depth information about the macro- and microeconomic situation, we would like the government to convey clear information and vision to operators so they can adjust and reskill their employees," Mr Vathit said.

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