Instant noodle players reporting huge profit during pandemic

Instant noodle players in China are probably the ones that benefit the most from the pandemic outbreak, while many other F&B players from other sectors recorded slight growth, remain neutral or seen a slight drop in revenue.
Instant noodles, being a convenient and easy-to-prepare food product, has become one of the main essential products stocked by mainland Chinese consumers even after the lockdown period. Not only is it affordable, but it is also a favourite fast meal among the working class, students and the younger population.
Due to the huge demand, companies are now increasing their investments by making instant noodles more delicious and healthy to meet the discerning tastes of consumers.
Master Kong of Tingyi Cayman Islands Holding Corp, China’s largest instant noodle producer, is capitalising on the premium instant noodle category and has seen rapid growth in sales in recent months. During the first 6 months of 2020, Master Kong saw its instant noodle business achieve sales revenue of Rmb 14.9 billion (US$2.2 billion), up 29.16% from a year ago. Interestingly, its higher priced (premium) instant noodles saw even higher growth at 47.8% during the same period.
Another major player, Uni-President China Holdings Ltd saw revenue jumped by 22% during the first 6 months to Rmb 5.21 billion (US$792 million). Uni-President has been focusing on using better raw materials including the use of broth and more healthy and fresh cold noodles.
Meanwhile, Japanese-based Nissin Foods Co Ltd saw its revenue for convenience foods, including instant noodles, jumped by 15.9% during the same period to US$224.5 million. Nissin targets health-conscious women with its high-fiber and low-calorie noodles whereas for the elderly group, it offers Japanese buckwheat noodles in small packaging. In addition, for the younger consumers, it offers noodles in spicy Tom Yam soup and Lanzhou beef noodles. Meanwhile, the packaging design of instant noodles also plays a part in attracting consumption. Kazuo Kawasaka, General Manager of Nissin China said, “Based on consumer feedback, we have placed an inner cover inside the instant noodle package to place the fork separately in one of our cup noodle products in China. The purchasing frequency of the product increased after the launch of this new design.”
The pandemic has proven that instant noodle is a resilient food category where demand is not affected, neither does its logistics and distribution. As modern consumers are becoming more demanding and environmentally conscious, instant noodle players might need to take up new strategies to tackle climate change and the environment by doing some changes to their packaging material or in the use of certain raw material ingredients in their products. One example is Zhengzhou-based instant noodle maker Baixiang Food Group which aims to develop tastier products with better raw materials and noodle-making techniques. The company uses a special technique to freeze-dry noodles at -30 C to lock the nutrients in fresh noodles. When cooking, the noodles will be able to restore the original taste and texture after boiling. The company is investing heavily in R&D to improve its products’ taste while enhancing the health benefits.
Nielsen research highlighted that the instant noodle sector in China saw its overall sales volume grew by 5.6% from a year ago while sales revenue jumped by 11.5%. This sector is expected to record high growth in the next 5 years. With growing number of ‘busy working lifestyle’ consumers in China, the demand for RTC and RTE foods will grow. And with more investments in R&D, current instant noodles, unlike its predecessors, are fast catching up to the real taste of noodles prepared at restaurants.