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Organic Food Opportunities in China

Being the largest consumer market for organic packaged foods and beverages and the fastest growing organic food market in Asia, China’s organic market offers many opportunities for foreign brands. Unlike other countries which mainly consume organic vegetables and fruit, organic milk dominates China’s organic market because of its nutrition and perceived benefits to the immune system. Together with edible vegetable oils and cereals, milk products account for roughly half of all food imports in China.

After the Covid-19 outbreak, physical health has – even more than before – become the core of Chinese consumers’ priorities. As Chinese consumers’ incomes continue to rise and more are concerned with a healthy diet, the market size of natural health food is expected to approach RMB 200 billion in 2022 (around US$29 billion).

While consumers traditionally prefer to buy Chinese food, western lifestyles and eating habits are increasingly becoming the norm, especially among younger generations who have travelled overseas to study or work. The Chinese middle class is interested in changing their food habits from heavy oil-tasting food to vegetarian-based, light, organic meals. Besides the taste changes, Chinese consumers are more likely to trust the high quality and credible imported food than local food.

With such potential, it’s not surprising that China has become a goldmine for international organic food suppliers. However, selling its products to Chinese consumers requires some adjustments and a specific strategy for cross-border e-commerce in China.

Furthermore, it is to be noted that most Chinese consumers still consider organic food as a luxury. Yes, it is obvious that organic food has more natural nutrients and secure guarantees. However, most Chinese consumers are price sensitive and look for value when buying organic food. Many Chinese consumers don’t think that organic food’s high price matches its nutritional value. Consequently, there is a lot to do as far as marketing is concerned, using Chinese social media. As for sales channels, online retail and O2O models are probably the most efficient sales channels for organic food in China.

To conclude, China’s organic food market is developing rapidly, and the potential demand for organic food among Chinese consumers is enormous, but attention is to be given to the specific needs of the Chinese consumer and the distinct characteristic of the Chinese market.

This is an abstract from an article written by Bart Horsten and published on the Green Seed International Newsletter on 4 September 2020. Green Seed Group is an international food marketing company.

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