The Surge of Instant Noodles during Quarantine

Photo by Sebastian Huxley on Unsplash

COVID-19, the Coronavirus 2019, which is also named as SARS-CoV-2, had spreader 188 countries up to May 26, 2020. More than 5.6 million patients had been diagnosed as COVID-19 positive, and the number is still increasing (JHU, 2020). Due to the high infectivity of COVID-1, the United States government had urged citizens to implement social distancing and reduce social activities. There is no wonder that the consumption will be influenced, and the households and firms would suffer from substantial financial loss. However, it is the instant noodle sales skyrocketed 578% between February 23 and March 21, 2020 (Ayesh, 2020). In this paper, the writer will dig into the hidden reasons for the sale boom of instant noodles.

Momofuku Ando, The Man who Invented Instant Ramen. Retrieved from https://www.popsugar.com/food/Who-Invented-Instant-Ramen-37016943

Invented by Momofuku Ando in Japan, instant noodles had deemed to become a worldwide phenomenon. In the beginning, instant noodles are packed in bags. In 1971, Nissin introduced cup noodles (Wikipedia). Then, this product is known around the world under many names. Instant noodles are friendly to eaters who need to travel or work in austere environments. Also, consumers can choose different flavors they want to get satisfied.

Photo by Ant Rozetsky on Unsplash

Although the primary component of instant noodles is wheat flour, same as traditional ramen noodles, there are vast differences between them. First, the producers need to dry the instant noodles by frying or in air. Second, palm oil, salt, monosodium glutamate, and other artificial components might be added to instant noodles to increase their flavoring.

Plus, due to the improvement of packages, the instant noodles can be stored much longer than traditional noodles. Most importantly, instant noodles can be produced in large factories equipped with advanced machines at large scale, while the conventional ramen noodles are supposed to enjoy in restaurants. Therefore, the cost of producing instant noodles is amazingly low, and eating instant noodles would doubtlessly help a person on a budget. As reported, an average American spends $6372 on food every year, while it only takes $142.65 to eat ramen noodles all year long (Yoon, 2018).

However, instant noodles had been criticized for many reasons. Although instant noodles are low in calories, they are also low in fiber and protein, which are essential nutrients to human beings. Also, they lack essential micronutrients as well, such as iron, manganese, and vitamins (Link, 2017). Plus, it contains high sodium and monosodium glutamates, which may damage human beings’ cardiovascular system. Therefore, it is categorized as inferior goods.

Healthy Food and Junk Food, retrieved from https://naturallysavvy.com/eat/too-much-junk-food-may-not-be-why-we-struggle-with-a-healthy-diet/

So, why would people choose instant noodles during quarantine when facing COVID-19? First and foremost, the income of consumers would decrease in quarantine. As mentioned before, people are not suggested to go outside and carry on group activities during this period. The households and firms will have much fewer customers, which will result in tremendous financial loss. Some companies chose to lay off employees to reduce expenditure. Those who are not discharged may receive lower salaries instead. Consequently, individuals would have less disposable income. When income decreases, the demand for inferior goods will increase.

It is worth mentioning that “demand” is different from “quantity demanded.” The former means customers’ willingness to pay for goods or services, while the latter refers to the total amount of a good or service that consumer demand at a given price. In economics, “demand” refers to a schedule of various combinations of market prices and amounts demanded. The demand curve of inferior goods will shift to the right side, as denoted in the graph. In other words, the consumption of instant noodles would boost during this period.

Changes in Demand for Normal Goods and Inferior Goods. Retrieved from: https://sites.google.com/site/muhammadafiqikhwan/microeconomics/supplyanddemandofsugar

Admittedly, instant ramen noodles have substitutes, which have equivalent value as instant noodles for consumers. Moreover, these substitutes experienced a sales boom as well. As reported, pasta, canned soups had swelled more than 400% in recent weeks (Ayesh, 2020). They share a lot of similarities with instant noodles. First, they are comparatively cheap than fresh foods. Second, they can be stored for a more extended period. Third, they are categorized as inferior goods. The demand for this kind of goods would increase as income decrease, and vice versa. All these tracts had denoted that citizens of the United States are struggling when stuck at home.

Now that the demand had increased, which means the demand curve shift to the right, shortage might be induced and would result in a situation in which demand exceeds supply. Therefore, manufacturers will invest more capital in fixing the gap between supply and demand. It is mentioned that the American stockpiling are trying to deploy supply chain and try to raise production (Ayesh, 2020). However, that does not mean demand would increase supply. The ultimate reason is merchandises are sensitive to the market. As Adam Smith maintained, the wealth will be distributed effectively when individuals are pursuing interests in the market. The pursue of interest in instant noodles would supply more commodities to customers.

Supply and Demand, retrieved from https://policonomics.com/supply-and-demand/

However, should those companies raise the price of instant noodles to maximize profits?

The answer is uncertain because there is no specific demand elasticity of instant noodles. To clarify, demand elasticity is a measure of consumers’ responsiveness to a change of good’s cost. However, there is more than one substitute for instant noodles, as mentioned before. If the change in prices is unacceptable for consumers, they will choose pasta or canned foods instead. Therefore, it may not be a wise choice to raise prices now.

Nonetheless, is it possible for instant noodles to get rid of the identity of “inferior good” during quarantine?

In developed countries like the United States, people may regard it as inferior good for granted. However, in developing countries, instant noodles are popular because they are delicious compared with their daily foods.

How to Make Ram-don, retrieved from https://uproxx.com/life/ram-don-recipe-parasite-movie/

For example, although China’s GDP had surged after the Chinese Economic Reform, $1 Japanese instant noodles are not the first choice for people in rural areas during the quarantine. Also, reflecting on the development of instant noodles, it had influenced so many countries and adapted to local culture. The “Ram-don” appeared in the movie “Parasite,” is a modified version of instant noodles. As Frost Natasha mentioned, a cup of noodles like “Ram-don” would cheer people up during this depressing period (Frost, 2020). Further, Japanese people had taken instant noodles as a cultural icon; there is even an instant noodle museum, Cup Noodles Museum, in Japan. Perhaps people are attaching more meanings to it, instead of regarding it as a mundane inferior good.

Cup Noodle Museum, retrieved from https://www.cupnoodles-museum.jp/en/yokohama/

To conclude, instant noodles have witnessed this pandemic. The surging demand for instant noodles indicated people’s struggle during this period in repose to economic changes. However, the adjust of manufacturers and consumers had proved the efficiency of the market economy. Although instant noodles were criticized due to many reasons, people’s choice won’t lie. Possibly, the instant noodles would become a heritage in this pandemic.

References:

“Instant Noodles.” Wikipedia: The Free Encyclopedia. Wikimedia Foundation, Inc. retrieved from: https://en.wikipedia.org/wiki/Instant\_noodle#cite\_note-1

Ikhwan, A., Supply, and Demand of Sugar. June 9, 2013.Retrieved from: https://sites.google.com/site/muhammadafiqikhwan/microeconomics/supplyanddemandofsugar

Ayesh, R., Ramen Sales Jump as American Stockpile for Coronavirus. Axios. April 4, 2020. Retrieved from: https://www.axios.com/ramen-sales-stockpile-coronavirus-outbreak-70dac099-a00e-450f-b0b9-c991b1c9611f.html

Yoon, J. 5 Things You Never Know about Instant Ramen. The Daily California. May 7, 2018. Retrieved from: https://www.dailycal.org/2014/09/18/5-things-never-knew-instant-ramen/

Frost, N., Ram-don, popularized by “Parasite” is the perfect meal for these Troubled Times. Quartz. March 7, 2020. Retrieved from: https://qz.com/1814346/parasite-noodle-dish-ram-don-is-perfect-coronavirus-quarantine-meal/

Link, R., Are Instant Noodles Bad for You? Healthline, April 15, 2017. Retrieved from: https://www.healthline.com/nutrition/instant-noodles

Undergraduate student / Research assistant/ Always curious / Opinions are mine

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