When you visit your local supermarket, you are likely to notice that the rice or coffee you buy comes from Southeast Asia. Thailand, Vietnam, and Indonesia are some of the world’s largest exporters of food products, with agriculture accounting for about 12 per cent of total GDP in 2021. According to the World Bank, roughly 28 per cent (180 million people) of Southeast Asia’s population is employed in agriculture. On the contrary, Singapore and Brunei lack both land and resources to develop an agricultural industry to support their populations’ food demands and need to import to bridge the gap. Food security is therefore a major concern for these city states where long-term planning is critical to ensure that food is available.
Rising threats to the resilience of Southeast Asia’s food production
Southeast Asia lags behind when it comes to sustainability and "green" eating. The region has mainly focused on industrialisation and economic growth. It is also home to many rural areas with low-income populations focused on farming, who can’t afford healthy or protein-based diets. By contrast, the European market is many years ahead of Southeast Asia in terms of alternative proteins, recycling, and green supply chains.
In recent years, the Southeast Asian agricultural industry has faced numerous challenges.
First, climate change has undermined the stability of food production and is posing new risks to food security. Second, as the Covid pandemic was stabilising at the beginning of 2022, the war in Ukraine began, pushing up commodity prices and increasing inflation. Third, urbanisation is pushing up demand for labour-saving technologies. Awareness in ensuring long-term food security, Southeast Asian economies are actively creating long-term strategies that are both sustainable and affordable This is an area where Sweden has a comparative advantage and an opportunity to share tried and tested sustainability practices across the agri-food tech sector.
Why Singapore is ramping up focus on food security
Strategically located, Singapore is consistently ranked as the world’s busiest port, and the world’s second largest trading hub for food commodities. As a small country, only half the size of London, most of the land is used for housing, industry, and transport infrastructure. Only 10 per cent of its food supply is produced locally and while the rest must be imported from all over the world. When the pandemic hit, the lives of Singaporeans were impacted by price shocks and import bans. To add on, prolonged heavy rains and floods in the region have led to decreasing supply of vegetables. To mitigate the risks of further disruptions, Singapore has embarked on an ambitious journey to produce 30 per cent of the nation’s nutritional needs locally by 2030. The entire government is now committed to mobilise both private and public players to make Singapore a secure and sustainable agri-food tech hub.
Singapore aims to become a global agri-food tech hub where new innovations can thrive
With one per cent of its land arable for food production, Singapore recognises the critical need for farms to maximise their output. This requires new innovations and enabling technologies. As of December 2022, Singapore has allocated a total of USD 220 million to provide funding for farms to expand and optimise their production capabilities, and USD 23 million for R&D in sustainable food production.
As of now, Singapore is home to more than 30 indoor vertical farms, it’s an R&D hub for four of the world’s top five food and nutrition companies and ranks among the top five locations for flavours and fragrance and ingredient companies. Singapore is home to many alternative protein manufacturing companies and is also the world’s first regulatory authority to allow cultured meat to be sold. Other Southeast Asian countries are now closely watching how Singapore resolves its food security issue with a view to incorporate best practices in their own economies.
Swedish agri-food tech companies can tap into several opportunities in Singapore
- Explore the R&D capabilities of local public sector institutes or private sector partners that can help jumpstart market trials for Swedish companies. Businesses are also eligible for funding if they intend to start local manufacturing of biotech-based protein or sustainable urban food production like leafy greens or berries.
- Share best practises and monetise your technologies. Sweden has built one of the highest standards in sustainable food production and food quality. The same may not be said for Singapore, as regulations for monitoring animal feed and alternative protein safety are still in the early stages. Swedish best practices and technological innovations for safe food, proper storage, and sustainable food production both downstream and upstream to open potential business development and consultation opportunities in Singapore.
- Use Singapore as a testbed for Asian taste buds. Even though Swedish businesses are in the forefront in healthy foods and alternative proteins, to tap into the Asian or Southeast Asian market requires that the product goes well with Asian flavours. Since Singapore is a melting pot of races and cultures, it presents a good testbed for Swedish companies to understand the market, and recalibrate flavours, before committing fully to expand their business to the rest of Asia.
This article is based on findings gathered during the Swedish delegation to Singapore as part of the International Agri-Food Week. Business Sweden showcased Sweden’s innovative Agri-Food Tech solutions to key stakeholders in Singapore, while giving Swedish companies insight into Singapore’s strong commitment to agri-food tech and how they are searching for collaborations and investments to reach their 30-by-30 goal.
Want to know more about Agri-Food Tech in Singapore? Get in touch to find out how Business Sweden can help you break into the market and to get an overview of our upcoming activities. You can also read about our Agri-Food Tech delegation 2023 here.