Food and Beverage to Myanmar

Trends and opportunities

The market

The food and beverage landscape in Myanmar is continuing to evolve as the country welcomes more tourists, business people, and as disposable incomes amongst locals increases. New premium supermarkets vie with local family owned shops and wet markets.  Modern convenience stores are appearing on many street corners in major cities and the restaurant and bar scene is changing too.

City Mart Holdings is the biggest retail operator in Myanmar with more than 180 outlets which are mostly convenience stores. Its multiple formats of retail businesses include City Mart supermarkets, Ocean hypermarket, City Express convenience stores, bookstores, health and beauty stores, baby and maternity specialty stores as well as cafes and bakeries. It currently operates 40 City Express convenience stores with the number of stores expected to grow to 200 stores in the next few years.

In August 2016, Japan’s retail giant Aeon announced plans to expand its supermarket business into Myanmar through a joint venture company created in partnership with local firm Creation Myanmar Group of Companies (CMGC). The new company, Aeon Orange, plans to acquire 14 supermarkets currently owned by CMGC affiliate Hypermarket Asia, in addition to opening an unspecified number of new stores (Source: The Nation, Aeon Orange Co takes 14 Hypermarts in Myanmar, 3 August 2016).

Myanmar has welcomed many international franchises and businesses over the past few years. Brands such as drinks manufacturers, carmakers and a host of Asian food and beverage outlets have popped up in recent years, as well as well-known United States (US) fast food chains.

Retail investors have encountered challenges as they launch operations including reports that supply chain difficulties have posed a problem. (Source: Oxford Business Group, Rising foreign investment in Myanmar’s food and beverage segment, 20 March 2017).

A range of Australian food and beverages such as premium beef, wine, fresh fruits, pasta, ice cream, UHT milk and other products are available in local high end supermarkets and restaurants.  Australia’s largest export to Myanmar is wheat which is used in bread and noodle manufacturing, with exports of A$128 million in 2015/16 (Source: Department of Foreign Affairs and Trade, Myanmar Country Fact Sheet, 20 March 2017).

Dairy, meat and wine

Dairy products, particularly long life butter, milk and cheese are popular with Myanmar buyers as parents seek sources of calcium for their children. Storage of these products though has been difficult due to the lack of domestic refrigeration and frequent power outages, so buyers tend to only purchase what they need for each day.

Historically meat consumption levels in Myanmar have been quite low since almost 90 per cent of Myanmar’s population are Buddhist and almost a third live below the poverty line. Meat consumption is increasing due to increasing wealth and international visitors with the greatest demand still for chicken and pork meat, however red meat is also growing in popularity. There is an increasing number of restaurants and bars serving beef and lamb dishes to young people eager to try new tastes.

Obtaining permits for importing red meat have been difficult for local distribution companies due to complicated import approval processes, however as the procedures are better understood, most distribution companies are able to source meat internationally.

There are only two wineries currently producing wine in Myanmar but the quality of Myanmar wine still has some way to go to match with international wines which are available in luxury hotels, resorts, high end bars and some supermarkets in Yangon. Importation of wine and other alcoholic beverages has long been restricted to hotels and duty free store concession holders.  In early 2016, the Ministry of Commerce issued a notification providing permission for the licenced importing of wine, and companies have increasingly been able to source wines from across the globe including Australia (Source: Myanmar Capital, Myanmar Wine imports going to start again with legal action, 19 May 2016).

While wine is the first to be allowed in by the ministry, it has plans to adjust its policies for other kinds of alcohol in the future based on market demand though as yet no official notice on other forms of alcohol has been released.

Opportunities

With the increase in international standard hotels, restaurants and bars and with more premium supermarkets, there are number of opportunities open to Australian suppliers, including:

Retail

  • fresh fruit and vegetables in season – stone fruit, apples, citrus, table grapes, avocados, salad vegetables, mushrooms, etc.
  • processed foods – cereals, biscuits, pasta, pasta sauces, chocolate
  • dairy – UHT milk and cream, cheese, yoghurt
  • baby and infant food – formula, sauces, nutritional products
  • meat – beef and lamb
  • beverages – wine and fruit juice
  • healthy food (including organic and gluten free).

Food service and hospitality

  • premium/gourmet food and beverages
  • dairy – catering packs
  • meat and seafood – beef, lamb and salmon
  • wine.

Food processing

  • grains – wheat, barley
  • dairy-based food ingredients – milk powder, cheese and butter powder.

Competitive environment

The main competitors across the food industry for Australian exporters are:

  • fresh fruit and vegetables – US, China, Thailand, local producers
  • dairy – New Zealand, European Union (EU) and eastern Europe
  • processed foods – Thailand, Malaysia, China, Japan, Korea, US, United Kingdom, EU, Singapore
  • fruit juice – ASEAN, South Africa, EU
  • wine – US, South Africa, France, Chile.

Tariffs, regulations and customs

Tariffs

Myanmar is a member of the ASEAN Australia New Zealand Free Trade Area (AANZFTA). Reflecting its lower level of economic development, Myanmar’s commitments to reduce tariffs under AANZFTA are being phased in at a slower rate than other parties to the agreement. Tariffs will start to fall on most items either in 2015 or 2020. Visit the ASEAN AANZFTA tariff finder for tariffs on specific products.

Food import procedures

There are no specific quarantine requirements for exports of fresh fruit and vegetables from Australia to Myanmar. For more information, visit the Australian Department of Agriculture’s Manual of Importing Country Requirements (MICoR). However the Myanmar Government requires pest risk analysis forms to be completed for all fresh fruit, vegetables and grains from January 2017.

The Ministry of Commerce issues import licences for most food products. The Department of Food and Drug Administration (FDA) is responsible for inspecting and clearing imported food at the border.

Importers must obtain a food import licence for each product line being imported (i.e. each SKU requires a separate licence). Food import licences will only be issued if the importer presents a food safety recommendation for each food product. Food safety recommendations for most products are issued by FDA. A limited number of products require a recommendation from the newly formed Meat Inspection Board and the Ministry of Livestock and Fisheries, including fresh meat and fish products.

The application to the FDA for a food safety recommendation must be accompanied by:

  • an application letter
  • a product sample of 1.5 kilograms or 1.5 litres
  • a certificate confirming that the product is allowed for sale as food in the country of origin (a “free sale certificate”)
  • product specifications containing the following information:
  • product description
  • ingredient list
  • physical and chemical analysis
  • nutritional information
  • microbiological standards
  • packing
  • storage and shelf life.
  • manufacturing licence
  • payment of the relevant fees.

The FDA reviews these documents and carries out a laboratory inspection on the product.

If granted, the FDA recommendation lasts for two years. The next time a consignment of the same product arrives in Myanmar, a further recommendation isn’t needed from the FDA up until the two year expiry.

Imports into Myanmar are controlled by the Customs Department of the Ministry of Finance. Customs is responsible for assessing and collecting applicable customs duties and taxes on imports and carrying out other regulatory and law enforcement responsibilities relating to imports.

The importers need customs declaration and required accompanying documents for custom clearance:

  1. Import License
  2. Invoice
  3. Bill of Landing, air consignment note or truck note
  4. Packing list
  5. Other certificates, permits or import recommendation as required (e.g. country of origin or SPS or FDA certificate).
Food labelling requirements

Food labelling is the responsibility of the Myanmar FDA, which comes under the Ministry of Health. The relevant law is the Myanmar National Food Law 1997.

Food labels must clearly state the name of the product, contents including name and net weight, the manufacturer’s name and address, batch number, manufacturing date, expiry date, and required storage conditions.

Marketing your products and services

Market entry

Local agents or distributors with specialist industry knowledge and established networks are generally the best way for Australian food and beverage exporters as they are well acquainted with import procedures and documentation. This is to build market contacts, navigate regulatory and procurement processes and identify emerging opportunities.

Australian exporters wishing to enter the Myanmar market should plan a preliminary visit to meet potential agents, distributors, customers and relevant government agencies. Once a relationship with an agent or importer is established, regular visits should be made two to three times a year to maintain relationships and develop new leads.

Australian exporters can also participate in the increasingly popular food trade exhibitions which provide effective exposure for your company and products to importers and their customers.

Distribution channels

Myanmar has a traditional distribution structure of importer, distributor, wholesaler, retailer, though the largest retail companies are vertically integrated across the whole distribution chain. The larger firms also have trading companies in Singapore or Thailand that place orders and organise payment for shipments.

Hotels and restaurants generally order products through local importers and distributors rather than dealing directly with international suppliers.

Distribution networks in Myanmar are fragmented and unreliable. This is changing with the entry of international general and specialised logistics services.  The majority of the retail market is comprised of small and medium sized businesses. Yangon is the major distribution centre for goods imported by sea and air.  Mandalay is the distribution hub for upper Myanmar, especially for goods imported by land from China and Thailand.

Austrade Yangon is able to help identify potential local partners for interested Australian companies.

Transport

Most imported products arrive by sea through Yangon port, Myanmar’s busiest port. Road transport overland from neighbouring countries, particularly China and Thailand, is possible but the road systems are generally poor and road freight rates can be very high.

There are a growing number of direct air links with key Asia cities, and these provide a channel for air freight for perishable items. Air freight routes from Australia are typically through Singapore, Kuala Lumpur or Bangkok airports.

Links and industry contacts

ASEAN AANZFTA tariff finder
Customs Department
Food and Drug Administration (Myanmar)
Ministry of Agriculture, Livestock and Irrigation
Ministry of Commerce
Myanmar National Trade Portal
Union of Myanmar Federation of Chambers of Commerce and Industry

Please note: This list of websites and resources is not definitive. Inclusion in this list does not imply endorsement by Austrade. The information provided is a guide only. The content is for information and carries no warranty; as such, the addressee must exercise their own discretion in its use. Australia’s anti-bribery laws apply overseas and Austrade will not provide business related services to any party who breaches the law and will report credible evidence of any breach. For further information, please see foreign bribery information and awareness pack.

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