Customers at Huang Wen-liang's organic
restaurant in Taipei fall into three categories: people
committed to living healthy, those who fear dying and the
Like most organic outlets across east Asia, Huang's
business is doing well.
"As people's wealth increases, so does their standard of
living, and people with money become more concerned about their
mortality and start paying attention to their health," said
50-year-old Huang, who has eaten organic food all his life.
"People with little money don't care about such things."
During a typical Monday lunch hour, the tables in his small
canteen, which also doubles as a grocery store, fill up with
office workers scoffing down plates of organic rice and
vegetables and whole-wheat dumplings ladled out by his wife.
Thirty years of rapid economic growth in east Asia have
bolstered the ranks of the middle class from South Korea to
Hong Kong, where demand for fresh and packaged organic food --
especially vegetables and rice -- is rising strongly.
More recently, eating healthy has become increasingly
important due to worries of avian flu, which has killed more
than 70 people across Asia since 2003, and Severe Acute
Respiratory Syndrome (SARS), which killed about 800 people in
Taiwan has approximately 800 organic food outlets, most of
them individually run stores like Huang's, serving a population
of 23 million. Larger franchises and organic sections in
supermarket chains are making headway, however, like in South
Taiwan's market for imported organic food -- which is free
from synthetic fertilizers, pesticides and gene modified seeds
-- grew around 20 percent in 2005 to about $30 million,
according to a U.S. Department of Agriculture Attache Report.
The report estimated the market for locally produced
organic food at around US$30 million.
In South Korea, which has more than double Taiwan's
population, the market is much bigger. The Korea Rural Economic
Institute estimated the country's organic foods market at $578
million this year, up 22 percent from $474 million in 2004.
That figure is expected to top $1.6 billion in 2010.
South Korea's Dongwon F&B recently announced plans to open
a one-stop organic food shop called Dear Life in the upmarket
Songpa suburb of Seoul. ORGA, run by a unit of Pulmuone, also
operates a big chain of organic food stores.
"SARS and the chicken flu, all this reacted together
causing people to be more conscious about their health so they
spend more money buying organic," said Jonathan Wong, director
of the Hong Kong Organic Resource Center at Hong Kong Baptist
But higher production costs are pushing up retail prices by
50 percent to 300 percent in some cases, curbing demand, he
Wong said organic vegetables accounted for only around 0.1
percent of Hong Kong's daily vegetable consumption, adding that
many more people would switch to organic if prices were only
just 25 percent more expensive than regular vegetables.
Besides cost, another obstacle was consumer preconceptions
about the bland taste of organic food.
"A lot of people associate organic food with no flavor,"
said Yen Kui-hsiu, 38, who runs an organic noodle bar and
grocery store in Taipei called the "House of No Poison" in
"Even though most people try and balance health with taste,
in the end they will likely go for taste," said Yen. "But the
food is tasty, even my 13-year-old son likes to eat it."
Skepticism over whether products claiming to be organic
truly live up to their name is also a major challenge, store
operators say, and one that is yet to be addressed by adequate
labeling laws in Taiwan, Hong Kong and South Korea.
Japan saw its organic food sales plummet to $350 million in
2002, from more than $3 billion in 2001, after the government
imposed new classification rules on organic farming and
products, according to IFOAM, an organization of global organic
In Taiwan, specialty organic stores are springing up all
over the island selling everything from locally grown spinach
and yams to olive oil from Italy and raisins from California.
Mother Nature Co. Ltd, a leading wholesaler of imported
organic raw materials, spent $6 million to open two superstores
in Taiwan and plans to have 100 stores by the end of 2008.
Uni-President Enterprises Corp., Taiwan's biggest food
conglomerate, has opened 13 organic food stores and also aims
to open 100 stores within three years.
While the USDA estimates most natural food stores in Taiwan
are independently operated, the entry of larger retail chains
is likely to force consolidation among the smaller operators.
Shopkeeper Huang, who gave up a career as a furniture maker
to start his organic business eight years ago, saw much room
for growth in Taiwan, though he said the pace would be slow.
"It takes time to educate people and spread the word. You
can't expect to open a store one day and make a lot of money."
Additional reporting by Kang Shinhye in Seoul and Miho
Yoshikawa in Tokyo.
Copyright © 2005 Reuters Limited