Frozen food industry emerges as a bright spot amid pandemic gloom
The ongoing Covid-19 pandemic has forced the world to adapt to a fresh reality. Many consumers who wish to spend time at restaurants and cafes as well as just enjoy traditional snacks, such as samosas and fuchka from roadside vendors, experienced to think otherwise.
To gratify their cravings, a good number of urban residents, particularly those in Dhaka, have opted to stock up on frozen or ready-to-eat meals in a bid to avoid going outside amid the existing crisis.
This shift has fuelled the demand for frozen and ready-to-eat snacks, raising hopes among producers that they will enjoy good business in the coming years.
"This industry will grow. The pandemic has changed a whole lot of our habits, we do not act exactly like we did in February as Covid-19 created awareness about hygiene," said Ahmed Rajeeb Samdani, managing director of Golden Harvest Agro Industries, a leading frozen food manufacturer.
The demand for ready-to-eat chicken and beef products has grown over the past several years as the middle-class and working families increasingly seek convenience.
Encouraged by the rising demand, around 30 companies registered to create frozen foods and snacks.
Because of this, rapid growth occurred over the last three to four years, Samdani said.
Golden Harvest started out its journey back in 2006, when there have been only two other organizations operating in the industry.
Based on the managing director, the overall market for frozen foods, including meat products, currently stands at about Tk 1,000-1,200 crore thanks to 20 per cent gross annual growth normally for days gone by five years.
But this figure will probably double to Tk 2,500 crore by 2025, he said.
This forecast comes at the same time when many urban residents have opted to stay at home to steer clear of the contagious coronavirus.
As the government eventually relaxed its lockdown measures, restaurants in the united states slowly started to reopen from the beginning of June.
Still though, those that once loved to dine out now prefer to cook for themselves at home.
Tanvir Haider Chaudhury, ceo of Kazi Food Industries, said the leading frozen food maker has 150 franchisees and quick-service restaurants.
Sales at these outlets, which take into account multiple third of the business's total sales, suffered at the start of the countrywide 'general holiday' that commenced on March 26.
"Demand in these outlets began to increase from July," Chaudhury said.
However, Kazi Food saw higher sales growth from retail and supermarkets through the same period.
"Overall, we've had good growth this season compared to this past year," he said.
There also needs to be strong growth on the market in the coming years.
However, it could be challenging for firms that heavily depend on demand from hotels, restaurants and cafes this season, Chaudhury added.
Samdani echoed the sentiment.
"Although, it could appear that frozen foods market is continuing to grow a lot this season, the truth is different," he said.
"Hotels, restaurants, cafes and schools take into account more than one of third of our sales and so, revenue from this channel took a nosedive following the general holiday started out in March," Samdani added.
Moshiur Rahman, managing director of Paragon Group, a leading poultry breeder and chicken-based products manufacturer, said institutional sales dropped through the two-month lockdown as physical meetings, parties and social gatherings were off at that time.
But the demand from offices, hotels and such began to improve last month as persons are returning to work in order to maintain their lives amid the brand new reality.
So by the finish of the year, Paragon will likely post 10 % sales growth, he added.
Kamruzzaman Kamal, director of marketing at Pran-RFL Group, said the company saw good growth in the overall frozen food market this season.
"The frozen grocery store is growing fast and will continue as such," he added.
Samdani said the many market players will only be able to utilize this added demand after they develop capacity.
"We are yet to build up a proper distribution channel of cold chain facilities to move frozen foods in the country," he added.
Meanwhile, Golden Harvest is investing to expand its production capacity.
"We all have been hoping that another year is a good year," Samdani added.
