By 2050, over 60 per cent of the world’s demand for food will come from Asia. China alone has 180 cities with a population of over three million, and its 300 million-strong middle class is expected to double in number by 2020.
According to Dan Tebbutt, Austrade’s senior trade commissioner in Hong Kong, against this backdrop, the greater China food and drinks market is evolving quickly as the mainland becomes more urbanised and affluent.
Tebbutt was among several Austrade senior trade commissioners visiting from key Asian markets who held briefings with Australian business to highlight export opportunities.
He said the move away from traditional ‘wet markets’ and towards supermarket and mall shopping, and increasing demand for high-protein foods, was underpinning many of the current opportunities.
Tebbutt said export demand in mainland China is
strong for beef, lamb and a broad range of dairy products.
Market
access remains a challenge, but Australia has recently made some
progress with new categories such as table grapes, cherries and stone
fruit.
According to Tebbutt, premium, niche and value-added products such as processed foods, organic or uniquely Australian produce can generate interest in the Chinese market.
“Australia enjoys positive perceptions as a clean and green producer of wholesome, natural and trustworthy food products, although we still need to do more to build awareness about our brand,” he said.
Tebbutt warned, however, that China is not an easy market to access. Regulation of food and beverage products tends to be complex and logistics and customs usually take longer, which can affect the shelf life of fresh products.
Tebbutt pointed out that competition to enter the Chinese market is intense, so it’s important to take time to understand the market and establish good contacts in the region. Durable relationships can help exporters understand market drivers and consumption choices in terms of packaging preferences, serving sizes, visual appeal and distribution strategies.
“Australia’s cultural diversity and the large number of mainland Chinese students we host should enable Australian businesses to ‘culture-test’ products locally and build Asian literacy into your business,” he said.
It’s also important to undertake thorough research about factors that can affect the cost of doing business in China, such as the tariffs that apply to some agricultural products like beef and dairy produce.
Transportation networks can also be hard to navigate, and companies will usually need to consider local labelling and ingredients requirements.
Austrade offers a range of services to help reduce the cost, risk and complexity for Australian companies looking to export into China.
“As part of the implementation of the 'Australia in the Asian Century' white paper, the Australian government, in partnership with peak industry bodies, recently launched a new website with information about doing business in China,” Tebbutt said.
He encouraged anyone thinking about exploring this high-growth market to visit www.austrade.gov.au/Doing-business-in-China.
Austrade has 13 offices in the greater China region that can help companies with market entry by searching for potential buyers, distributors and business partners, offering general information and advice and identifying export opportunities.
Once it has determined buyer
requirements, Austrade seeks out suitable Australian suppliers,
facilitates introductions to these buyers and helps suppliers to
secure the business.
Opportunity still
knocks in the more established markets
Hong Kong and Taiwan don’t have the same geographical scale as mainland China, but they often set trends for the region and can be seen as a marketing platform, particularly at the premium end. Here are some market trends:
HONG KONG
- Strong reliance on imports – 95 per cent – and supermarkets tend to buy direct from exporters via offices in Australia.
- Expansion of high-end full service supermarkets, restaurants and bakery shops is underway.
- Strong focus on food safety and provenance with healthy lifestyle driving demand for safe, organic and natural food and health food products.
- Positive perception of Australia as a supplier of fresh, quality and safe products.
- Largest export market for premium seafood and fruit and a major market for beef, wine and dairy.
- Sophisticated consumer market with high disposable income driving demand for greater diversity in food service options.
- Tourism boom: demand from cross-border visitors grows to 48 million (local population seven million).
TAIWAN
- Small geographic size but Australia’s sixth largest export market ($A7.9 billion in 2012 excluding services).
- Affluent population of 23 million driving demand for high-quality food products.
- Strong growth with Chinese tourists (2.2 million in 2012) leading a surge in five-star hotels and fine dining.
- Industry is dominated by major restaurant chains, which continue to expand in Taiwan, China and other countries.
- 3.58 per cent GDP growth forecast in 2013, which should slightly outperform South Korea, Singapore and Hong Kong.
Source: Austrade
