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Japan's House Foods spices up curry business in China

Country's growing appetite for Japanese variety sends sales climbing

Vermont Curry is House Foods' main product in China.

TOKYO -- Japan's House Foods Group is ramping up its curry business in China as more households develop a taste for the Japanese variety of the dish.

The company plans to release large, eight-serving packages of curry roux this fall in a bid to boost consumption.

A new production line at its plant for restaurant-use roux in Dalian, Liaoning Province will start this summer. The 400 million yen ($3.68 million) addition is central to the company's goal to increase sales in China to 13 billion yen by fiscal 2023, up 2.2 times from 2018.

Based in Osaka, House Foods entered the Chinese market in 1997 via sales of curry roux to restaurants. In 2005, it expanded into the consumer market with release of its Vermont Curry, offering samples at supermarkets to familiarize Chinese with the product.

China has become an important market for House Foods, with sales hitting 5.8 billion yen in fiscal 2018. The company has so far limited consumer sales to four-serving packages, but will begin offering eight-serving boxes in major cities like Beijing and Shanghai.

"In China, big cities are seeing an increase in heavy users [of curry roux] of a kind often seen in Japan," said Tetsuya Ishikawa, head of international business development at House Foods.

A shopper samples House Foods curry at a supermarket in China.

Eight-serving packages will be produced at a plant in Zhejiang Province that began operating in 2018, the company's third manufacturing base in China.

The market for both home and restaurant products has grown about 20% annually in China, according to the company. Retail prices of curry roux in the country are roughly 10% higher than in Japan.

House Foods chalks up more than 10% of its curry sales through home delivery services, such as Alibaba Group Holding's Ele.me, and online platforms, which are contributing to the growth of the curry market.

While Vermont Curry is House Foods' main product in China, the company also offers Java Curry and retort products. Home-use curry accounts for some 70% of its Chinese sales.

House Foods employs 400 workers in the country and may set up marketing and product development units to boost sales via food delivery service operators and online platforms.

The company said it has captured more than 50% of the Chinese curry market.

Although more Chinese are eating curry these days, the market is still developing. People in rural areas remain unfamiliar with the dish while in cities sweet curry is more popular as the main buyers are households with children.

"We will have to figure out how to attract adult consumers," Ishikawa said.

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