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Shanghai: Driven by demand from more affluent and health conscious eaters, one of the biggest growth areas in China is low-fat versions of traditional instant noodles, which are deep fried as part of the production process.
"Healthy positioning of instant noodle brands are the key factor driving consumer buying patterns in Greater China," said Michelle Huang, an analyst at Euro-monitor International.
"In mainland China, instant noodles manufacturers launched new variants with added nutritional value in an effort to break the traditional perception of the instant noodles as being unhealthy," he added.
Japan's Nissin, the largest noodle maker in Japan, has been promoting non-fried variants in China and at home.
Through a 2004 tie-up with Hebei Hualong F&N Industry Group, it has formed Nissin Hualong Food, the second largest instant noodle maker in China.
Its main competitor Taiwan's Tingyi owes its success to entering the market early and building up strong brand loyalty with wide distribution.
"Tingyi has been able to garner significant market share due to its distribution network," said Renee Tai, an analyst in Hong Kong.
"It's not just ads and pushing products through with promotional activities, but it's really getting the products through to customers. They got that part right."
Tingyi has located its manufacturing facilities close to distribution centres, which ensure it gets its products to market quickly and smoothly, added Tai.
To maintain market share and lower the impact of soaring raw material prices, Tingyi is focusing on the high-end noodles where margins are bigger, said Tai.
Noodles in China have a long history. Opinions differ over whether the Chin-ese, Italians or Arabs invented the food, but a 2005 discovery of a sealed bowl believed to be 4,000 years old in northwestern China could swing the debate in China's favour.
Nissin is now poised along with other market players such Uni-President to gain from a blitz of retail and marketing promotions leading up to the 2008 Beijing Olympic Games.
Uni-President - official sponsor of the Beijing Olympic Games - has been making a loss in its noodle business. It has volunteered to donate one yuan from each sale of instant noodles to build schools throughout China.
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