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Food Processing

Malaysia’s food processing sub-sector includes all companies involved in value-added activities utilising agricultural or horticultural products, such as the manufacturing of cocoa & chocolate products, fishery products, cereals & cereal products, and processed fruits & vegetables. This sub-sector is transitioning from the use of conventional processes to the use of emerging technologies, assisted by the introduction and subsequent extension of the Automation Capital Allowance (ACA) incentive.

There are more than 8,000 establishments in this sub-sector, mainly dominated by Malaysian SMEs. Well-known MNCs and LLCs, both domestic and foreign, are active in the industry. Among notable companies in the industry are Yeo Hiap Seng (Malaysia) Berhad, Nestle (Malaysia) Berhad, FFM Berhad, Malayan Flour Mills Berhad, Kawan Food Berhad, QL Resources Berhad, Charoen Pokphand Holdings (Malaysia) Sdn. Bhd., Ayamas Food Corporation Sdn. Bhd., Dewina Food Industries Sdn. Bhd., Ramly Food Processing Sdn. Bhd., Super Food Specialists (M) Sdn. Bhd., Golden Fresh Sdn. Bhd., Purecircle Sdn. Bhd., Kellogg Asia Products Sdn. Bhd. and Hershey Malaysia Sdn. Bhd.

Malaysia's Halal industry provides immense opportunities for food processing industry players, due to its strong value propositions. The country's Halal certification is well-accepted internationally, boosting Muslim consumer confidence, and indicating that certified products have passed safety, quality, and legal requirements based on Good Manufacturing Practice (GMP) and Hazard Analysis and Critical Control Points (HACCP). Potential investors are encouraged to leverage on this comprehensive halal ecosystem, particularly in the food industry.

Increasing consumer awareness about health and nutrition values has created strong demand for functional food/ingredients and natural food flavours from plants and seafood. Investors looking into the food processing sub-sector should take note of the significant potential for further growth in food ingredients such as customised formulations required by food manufacturers, functional ingredients, and natural food additives and flavours.

In 2017, there were 66 food processing projects worth investments of RM2.3 billion approved. Domestic investments of RM1.4 billion (63%) led the way, while foreign investments formed more than a third of the total at RM900 million (37%). The 44 new and 22 expansion/diversification projects had resulted in employment opportunities for 4,644 people.

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Last Updated : Thursday 21st November 2019