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PMA Foodservice Delivered

How COVID-19 impacted foodservice in New Zealand, Australia, and Singapore

On Wednesday, the PMA Foodservice Delivered virtual event featured two general sessions. The second session of the day brought forth an international perspective and featured a panel led by the PMA AU-NZ CEO: Darren Keating. The panel consisted of Steve Kent, who is the General Manager of the Fresh and Processing Divisions at Bidfood Limited, Michael Simonetta, CEO of Perfection Fresh Australia, and Gary Loh, Founder and Chairman of Dimuto PTE Ltd. The conversation centered around the impact of the COVID-19 pandemic on the foodservice industry in the panelists' respective locations: New Zealand, Australia, and Singapore.

Right: Darren Keating.

New Zealand: Full lockdown starting to be lifted
Unlike many other countries, New Zealand went into a total lockdown. “The lockdown started on March 21st, and we had about two days to prepare for it,” Steve Kent shares. “While we were able to continue our operations as an essential business, our demand basically stopped due to the closure of the foodservice sector.”

Bidfood used the time of the lockdown to prepare for what would happen after the lockdown, says Kent. “We were working out what the landscape would look like coming out of the lockdown and talking to consumers to try to predict what their needs might be after the lockdown ended. Then we started working to gear up our business to be able to support this new supply chain. When the lockdown started lifting, we were very pleasantly surprised. New Zealand’s foodservice industry usually has a heavy reliance on tourism, which is still non-present. But overall, people have shown that they are ready to support their local businesses, and also that they are ready to eat food that isn’t cooked by themselves in their own homes. I would say that the foodservice sector has proven to be remarkably resilient,” Kent explains.

“We have seen a great sense of community spring from the pandemic, as well as a significant drive to support local production in all kinds of industries here in New Zealand,” Kent adds. “That is something I hope will continue to thrive as we get to the other side of the pandemic.”

Australia: Overall impact wasn’t as bad as expected
Similar to New Zealand, Australia is starting to recover from their lockdown and ease restrictions, with the exception of the state of Victoria where restrictions have recently been tightened again. The impact on the produce industry hasn’t been as bad as was initially expected, Michael Simonetta shares. “There are a few products which absolutely tanked overnight because of the closure of foodservice: baby leaf salads, avocados, and the fresh cut division – fresh cut fruit and ready-to-cook vegetables went down by 70-80% overnight. But there were also other premium products that we were worried about, like broccolini for example, that were able to be almost completely diverted into retail.”

Restaurants and other foodservice establishments also pivoted. “Almost overnight, we saw restaurants everywhere switch from dine-in settings to take-out and delivery. There was also an enormous surge of direct-to-consumer produce boxes throughout the country, specifically by secondary wholesalers. So I would say that the overall impact, with the exception of a few products, wasn’t as bad we thought it would be back in March. The customer’s quest for convenience knows no bounds, and while this quest is on a bit of a hiatus at the moment, it will resume shortly enough,” Simonetta says.

Singapore: Low- and high-end establishments thrive while the middle-level struggles
Singapore was one of the first regions to which COVID-19 spread. Gary Loh explains how the situation there was brought back under control, and how the foodservice industry was affected. “Everyone started working from home and restaurants closed down. About a month ago, things began reopening, with the exception of certain areas,” he shares. “What we are seeing now is that food centers and open markets are very popular. These are places where people can easily purchase food to take home with them. We are also seeing that all the top-end restaurants are completely full, and even getting a reservation for these restaurants is difficult. The middle-ground establishments, on the other hand, are left out a bit and are struggling more.”

One big change that Loh has seen on the Singapore market is that the consumers have become a lot more cautious. “In Singapore, the majority of products are imported, and previously there was this fake sense of security people had; they weren’t worried much about the safety of these imported foods. This sense of security is now gone, and people have become a lot more cautious about where their food has come from. Another thing that has increased which ties into that same issue is the demand for traceability of products. Customers are becoming a lot more engaged in demanding this.”

Another important change on the Asian market in general is the addition of new suppliers, says Loh. “A lot of importers were in need of finding new suppliers to cover gaps in their inventories, and we have seen that Latin American and African producers are really stepping up. We now see, for example, a lot of Colombian and Kenyan avocados on the market, which previously weren’t even considered by importers,” he concludes.

To register to attend PMA Foodservice Delivered, click here.

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