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November 26, 2019updated 19 Jul 2022 4:52am

Six trends to shape China’s food market in 2020

just-food's China columnist Peter Peverelli analyses the emerging consumer trends driving demand in the Chinese food industry and sets out the product categories to watch in 2020.

just-food’s China columnist Peter Peverelli analyses the emerging consumer trends driving demand in the Chinese food industry and sets out the product categories to watch in 2020.

Free Report
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What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

DIY food

One of the most conspicuous trends among food products recently launched in China is what I like to call ‘DIY food’. This should not be mistaken for meal kits, sold as do-it-yourself products combining the ingredients needed to cook a dish, which are becoming popular in some European countries.

More manufacturers in China are giving consumers the ability to make their food more individual to themselves. This trend is developing towards allowing consumers to add a personal final touch. In the instant-noodles category, there are an increasing number of products on sale with separately packed ingredients.

The most elaborate example is the Spicy Tripe Noodles by Shizuren Food Technology Co. Ltd, based in China’s central Henan province. Apart from the noodles themselves, a pack includes: spicy oil, flavoured soy sauce, compound powdered spices, spicy tripe, sesame paste and dehydrated vegetables, all in separate sachets. You can add these condiments to the noodles in the ratio of your preference.

Heating products on-the-go

Chinese still prefer hot food to cold. Instant noodles can be prepared with boiling water available in train stations, airports, trains, hotels and supermarkets.

However, this has, in years gone by, been more difficult for ready-to-eat congee, the rice porridge that is a popular cereal product in China. Several Chinese travellers soak tins of congee in hot water in their hotel washrooms.

Recently, self-heating congee has appeared. The heating is produced by a chemical reaction that you can set in motion by squeezing the bottom. More self-heating products have followed, like self-heating hot pots.

During a recent vists to China, I saw self-heating dishes in supermarkets that are part of the service stations along Chinese express ways. Travellers can thus enjoy hot dishes instantly and get back on the road more quickly than by having a bite in the restaurant that is usually also part of the service centre.

However, these products will also be appreciated by white-collar workers, or the growing league of young single Chinese in their first job, not in a hurry to settle down and start a family.

Goody boxes

Goody boxes containing samples of part or all of the product range of one manufacturer is becoming fashionable in China.

One of the earliest presentations was a box of single portions of nuts and seeds by Three Squirrels, a company based in the eastern Anhui province. The company presented it as a ‘gift pack’, but many Chinese consumers have welcomed it as a perfect way of sharing food with others.

Such boxes suit Chinese communal culture: food tastes best when you share it with your family, colleagues or friends. Moreover, Chinese are eclectic. They do not eat either fish or meat, but want fish and meat and vegetables and pudding and so on.

These goody boxes also address that trait of Chinese eating culture. Imagine a group of friends opening such a box, and finding several packs of: pecans, baked beans, rice crisps, preserved fruits, and more. Presented on different plates, it resembles a Chinese meal. You only need to add drinks and you can have a feast.

I have seen a number of similar good boxes with meat products as well, like the one from Koushuiwa Food in Suzhou, a city in south-eastern China. The box includes pork sausages, beef jerky, chucks of fried fish and other stuff.

Light eating

Light Eating is the literal translation of qingshi, a recently-coined term referring to a broad spectrum of low-calorie foods.

‘Light’ here is not only about fat, but incorporates the entire ‘low fat, low sugar, low salt’ trend seen across the West.

However, it is more than a Western trend also catching on in China. Adherents of light-eating point out it links with statements in the ancient Chinese medical classic Huangdi Neijing, the Inner Canon of the Yellow Emperor, dating back several centuries BC. Already in that early age, Chinese doctors warned against overeating and consuming too much fish or meat.

After the term qingshi was launched, a number of food companies made it part of their marketing strategy, naming several existing products like sandwiches, salads, cold noodles and so on as ‘light’ products.

Meat alternatives

There are clear signs Chinese consumers are getting ready for plant-based meat.

The recent outbreak of African Swine Fever (ASF) in China has contributed to this development. China produced 24.7 million metric tonnes of pork in the first six months of 2019, down 5.5% from a year earlier, according to figures from the National Bureau of Statistics quoted by The South China Morning Post in July.

According to Dutch agri-food investment bank Rabobank, pork consumption has reportedly dropped by 10-15%. Even though ASF does not affect humans, many Chinese consumers, already highly anxious about food safety, will think twice before buying the meat of an animal that is all over the media due to a contagious disease.

However, this does not mean that they all switch to beef or mutton to sate their craving for meat, because they dislike the stronger flavour of beef and mutton compared to the more neutral pork.

Producers of meat alternatives regard this as a unique opportunity to introduce their products in China. According to Pat Brown, the CEO of US meat-free business Impossible Foods, China has “always been the most important country for our mission”. He regards China as a potential game-changer for the nascent imitation-meat market, which accounts for less than 1% of the global meat consumption.

I tend to agree with that assessment but I would like to add that he, or any other supplier of meat alternatives in China, need to make the products launched in the country suit the Chinese palate. Impossible’s burgers are already served at Burger King and other restaurants in the US but the company should develop artificial pork products for China.

Products that are likely to catch on in China could be cubes of pork that can be used in stir-fried dishes. These could be flavoured according to a number of typical Chinese standard flavours like yuxiang (fish flavour; a mixture of soy sauce, vinegar, chili, sugar and starch) or mala (numbing hot; a mixture of Sichuan pepper and chili), or unflavoured, so the cook can use them in existing recipes. Similar ranges could be developed for strips and slices of artificial pork. Beef, chicken, etc., could follow.

Singles, an emerging, high-potential segment

When a young Chinese had passed the age of 20 and still not in pursuit of a life partner, relatives, friends, and colleagues would start introducing candidates. Living on your own was not an option.

This has started to change during the last decade and the league of relatively young people, just graduated from college, concentrating on their career rather than starting a family, living in a small apartment, has now grown into a substantial market segment.

These consumers have a set of eating habits of their own. A clear sign of the impact of this group in society is the institution of Singles Day in China, a shopping holiday on 11 November every year originally devised in the 1990s as Bachelor’s Day for single men. Now 11 November has become a major shopping event for both genders.

Young Chinese singles want to be excited by new flavours and textures – and have disposable income to spend.

The China Food Newspaper of 6 November opens with an item entitled: ‘Singles economy becoming a multi-billion market; how to get hold of the stomachs of 240 million single aristocrats?’ The article is illustrated with a photo of a gourmet pizza still in a box, crème brulée and a carton of peach juice; decorated with the white rose.

If you want to cash in on the market of feeding these single Chinese, remember they do cook, but not every day. One-person, easy-to-prepare-at-home, pre-packaged meals is a serious option.

Combine these products with the DIY trend and create a package of a meal with some additional ingredients that keep better in separate packs. These products should have a high-end image, looking fresh, even though it will not officially count as fresh food. Make sure that the products can be ordered online.

These trends are, of course, not designed to be a comprehensive list of the fashions shaping demand for packaged food in China. However, they should give product developers and company strategists fresh ideas as they embark on trying to capture a share of the one of the world’s most rapidly-evolving consumer-goods markets.

Related Companies

Free Report
img

What’s the forecast for the food and grocery industry?

The food and grocery sector thrived during the pandemic, largely due to the shutdown of the food service industry and the sector’s subsequent necessity, panic-induced bulk purchasing, and spending more time at home. The market has grown as a result of inflation. Consumer unwillingness to go out and socialize, and the reopening of several hospitality facilities, helped maintain the demand for groceries, particularly online, in 2021. As consumer behavior changes, we consume more food and drink at home, and inflation increases basket sizes. GlobalData predicts that the sector will continue to hold a higher share than had been predicted prior to the pandemic. This is true despite the fact that the food and grocery sector's share of overall retail will decline from its peak in 2020. This report will discuss market forecasts and key themes in the global food & grocery industry in 2022 and beyond. It covers:
  • Market drivers and inhibitors
  • Five-year forecasts and the impact of COVID-19
  • The performance of the online channel versus offline
  • Major trends in the market including rapid delivery, ambient retailing, supply chain disruption, and inflation
Assess developments within this sector to help your business thrive in 2022 and beyond.
by GlobalData
Enter your details here to receive your free Report.

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