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Japan's snack makers to launch halal lines in Indonesia

Morinaga plans halal-certified Hi-Chew candies.

TOKYO -- Japanese food makers Morinaga and Calbee plan to produce and sell halal-certified snacks in Indonesia, the first step in tapping demand from growing populations in majority-Muslim nations.

     Morinaga will introduce a halal version of its Hi-Chew fruit candies to supermarkets and convenience stores in Jakarta, Surabaya, Bandung and other major Indonesian cities starting in late April. The gelatin and other ingredients used in the products meet Islamic dietary guidelines. The candies are Morinaga's first halal-certified offering.

     Affiliate Morinaga Kino Indonesia, established in 2013, will handle production. A dedicated line was added last month to the company's factory in Semarang at the cost of several hundred million yen.

     A 70-gram bag of the candies will be priced at 10,000 rupiah (76 cents), around 50% more than similar products. Middle- and upper-class shoppers are the target. Morinaga estimates Indonesia's candy market at 30 billion yen ($274 million), around 15% the size of Japan's. The company wants to gain a foothold in the country ahead of anticipated growth.

     Morinaga also looks to use Indonesia as a base for exports to neighboring Malaysia, as well as to countries with large Muslim populations such as Pakistan, Bangladesh and those in the Middle East.

     Fellow snack maker Calbee will make and sell halal products as soon as July. The two planned brands will consist of five offerings in all, including high- and low-price items. The company targets a 10% share of Indonesia's snack market within five years of launch.

     Lotte Holdings already has Indonesian operations, making and selling a chocolate snack cake there since 2014.

     Japan's snack makers earn the majority of their sales at home. But an aging and declining population has diminished expectations for domestic market growth, prompting companies to establish themselves overseas.

     The market comprising Indonesia and other Muslim nations is particularly promising. U.S. think tank Pew Research sees the world's Muslim population rising to around 2.8 billion in 2050, up 73% from 1.6 billion in 2010. With the global population seen growing only 35% in that time, Muslims would account for nearly 30% of the total compared with around 23% in 2010.

     Indonesia's Muslim population, around 90% of the country's 250 million residents, is currently the largest. Food producers view the country as an ideal base for expansion elsewhere.


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