China

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E-ssentials Online

PMA Members now have direct access to the retail produce training courses online at PMA.com.  This educational training is called E-ssentials and is available in both English and Spanish.

Market Dynamics

April 2011

Fresh produce production, consumption, and trade have all grown substantially in China in recent years. According to the latest China Statistics Yearbook, domestic production tripled between 2000 and 2009, rising from 62.6 million tons to 203 million tons over the period. Over roughly the same period (2009 data is not yet available), fruit and vegetable consumption among urban households rose 8%, reaching 177.6 kg per household. That figure does not, however, include fresh produce consumed outside the home, which could add another 30% if factored into total consumption, according to some studies.

As for trade, China fresh produce imports reached 8.9 million tons, more than double the total eight years prior. Fruit imports from the US, by far China’s largest foreign source, stood at 1.86 million tons in 2009, or around 78% of the total. Produce exports have, meanwhile, grown at around the same pace, doubling to 10.07 million tons, with the main markets being other countries in the region, such as Japan, South Korea, Malaysia, Indonesia, and Russia.

Like many other products, demand for fresh produce in China is being driven by China’s rapid economic growth, rising per capita incomes, and increasing consumer spending. Consumption patterns are now changing, as a result. For example, middle and upper class consumers are now substituting fruits, vegetables, and livestock products for staple grains, which use to comprise a much larger portion of their diets. These consumers, whose spending on fresh produce rose between 11-13% between 2000-08 and who are spread out across the country, are also increasingly selecting products based on quality and safety, rather than price alone, which is forcing the local distribution networks and supply chains to keep pace in terms of efficiency and safety. Although it is growing rapidly, total consumption appears to be about 154kg per capita per year.

Although distribution still lags in some areas, great advances have been made over the past 20 years. There have been marked improvements in handling and storage. The gaps or weaknesses that remain are the primary factors affecting the quality, safety, and price of fresh produce. Lack of information and transparency in the distribution in general, and lack of knowledge of handling, in particular, have impeded the further development of the industry, as have other factors, such as the rapid emergence of new markets around the country.

China Retail Annual Report

The China Vegetable Logistics Association and the China Fruit Market Association, two of the largest fresh produce organizations in the country, play lead roles in guiding the industry. Both conduct research into fresh domestic produce and provide information on trends in the industry to their members through seminars and training programs. However, most of their activities are limited to domestic growers and state-owned logistics companies and retailers, which means they are focused almost exclusively on domestic production.  Read more.