Food, beverage revenue hits new high in Q1

Taipei, April 24 (CNA) Sales posted by the local food and beverage industry hit a new high in the first quarter of this year and were up more than 8 percent from a year earlier following solid domestic consumption, according to the Ministry of Economic Affairs (MOEA).

Data compiled by the MOEA showed revenue generated by restaurants, beverage vendors, and catering services providers totaled NT$275.9 billion (US$8.49 billion) in the January to March period, up 8.1 percent from a year earlier.

The strong first quarter figure came following data showing sales generated by the food and beverage industry in March rose 13.6 percent from a year earlier to NT$87.5 billion.

Robust growth amid safety issues

Speaking with reporters, Huang Wei-jie (黃偉傑), the ministry's Department of Statistics deputy head, said the double-digit sales growth in March showed many consumers had not been put off by recent food safety issues, which include the discovery of a toxic industrial dye known as Sudan IV in certain food items.

In particular, sales posted by restaurants hit NT$73.3 billion in March, up 14.9 percent from a year earlier and Huang said this robust growth showed consumers still favored dining out.

In addition, beverage vendors and catering service providers generated NT$10.0 billion and NT$4.3 billion in sales, respectively, in March, up 3.1 percent and 17.6 percent from a year earlier.

Huang said the food and beverage industry is expected to post year-on-year sales growth between 2.4 and 5.4 percent in April -- between NT$83.5 billion and NT$86.0 billion.

Retail sales

Also boosted by strong personal spending, retail sales in the first quarter totaled NT$1.14 trillion, up 3.1 percent from a year earlier. Revenue in March was up 0.7 percent from a year earlier and hit NT$373.0 billion.

Huang said an increase in foreign travelers, retailers' efforts to expand and the debut of new products all pushed up consumer buying in March.

In March, department stores posted NT$32.7 billion in sales, up 8.0 percent from a year earlier and supermarkets posted NT$20.7 billion, up 4.9 percent, the data showed.

In addition, convenience store chain operators and hypermarkets saw their sales rise 1.6 percent and 0.1 percent, respectively, from a year earlier to NT$34.3 billion and NT$18.7 billion in March, the data revealed.

Online retailers also enjoyed a 2.4 percent year-on-year increase with sales hitting NT$34.3 billion in March, according to the data.

Bucking the upturn, auto and motorcycle retailers posted a 4.5 percent year-on-year decline in sales totaling NT$71.4 billion. Huang said the drop largely reflected a relatively high comparison base over the same period last year when an eased shortage of raw materials propped up production and sales.

Huang said retail sales are forecast to range between NT$369.8 billion and NT$380.9 billion in April, up 0-3 percent from a year earlier, and that the level of growth will be affected by a high comparison base a year earlier.

Wholesale sector

In the wholesale sector, sales in the first quarter reached about NT$3.01 trillion, up 7.5 percent from a year earlier, following rising demand for products related to artificial intelligence development, the MOEA said.

In March alone, wholesale sector revenue rose 4.6 percent from a year earlier to NT$1.07 trillion, the MOEA added.

Huang said demand for AI applications and cloud-based computing devices boosted shipments of related electronics components in the wholesale sector in the first quarter.

The AI development frenzy also pushed up demand for items in the machinery industry, which is comprised of computers, handheld devices, electric machinery and electronics equipment.

In the January-March period, sales posted by the machinery wholesale segment hit NT$1.35 trillion, up 20.4 percent from a year earlier, MOEA data showed.

Underperformers

However, some old economy industries remained haunted by weak demand amid a faltering economic recovery. Sales posted by producers of raw materials for buildings fell 11.2 percent from a year earlier to NT$105.3 billion in March, the MOEA said.

In addition, furniture, home appliances, cameras, precious metal and detergent suppliers saw their sales fall 4.7 percent from a year earlier to NT$63.4 billion in March, while sales posted by drug and cosmetic suppliers also fell 4.3 percent from a year earlier to NT$68.6 billion in March, the MOEA added.

Huang forecast sales in the wholesale sector to range between NT$949.6 billion and NT$976.7 billion in April, up 5.1-8.1 percent from a year earlier due to expectations that solid domestic demand will boost sales and offset fragile foreign demand.