New Zealand beefs up its pres­ence in China

DEMM Engineering & Manufacturing - - FOOD PROCESSING -

Agri­cul­tural bank­ing specialist Rabobank says Chi­nese beef con­sump­tion is ex­pected to con­tinue grow­ing at a faster pace than do­mes­tic pro­duc­tion, in­creas­ing the re­liance on im­ports to sat­isfy de­mand.

How­ever, re­port co-au­thor, Rabobank an­i­mal pro­teins an­a­lyst Matt Costello, warns that while the New Zealand beef in­dus­try sees long-term growth and po­ten­tial within the Chi­nese mar­ket, so too do com­peti­tors from around the world.

“Cur­rently both New Zealand and Aus­tralia have a sig­nif­i­cant head start due to di­rect trade and mar­ket ac­cess which gives them the op­por­tu­nity to es­tab­lish and ce­ment long-term strate­gic part­ner­ships along the sup­ply chain,” he says.

Chi­nese beef con­sump­tion has grown at a steady pace, and al­though it re­mains low in com­par­i­son to pork and poul­try con­sump­tion, it has be­gun to out­pace lo­cal pro­duc­tion, set­ting the stage for an in­crease in beef im­ports.

Costello says beef ex­porters across the globe are now look­ing to China in an at­tempt to un­der­stand whether this de­mand surge will plateau or if the need for beef im­ports will con­tinue to grow.

“Chi­nese pro­duc­ers and pro­ces­sors are also aware of the loom­ing struc­tural deficit in the beef sec­tor and are adopt­ing dif­fer­ent strate­gies to se­cure sup­ply amid an en­vi­ron­ment of f lat­ten­ing global pro­duc­tion,” he says.

“The rapid growth of the quick ser­vice restau­rant (QSR) sec­tor in China is pro­vid­ing an ef­fi­cient chan­nel for in­creas­ing beef con­sump­tion among the young and wealthy.” More than 60 per cent of beef con­sump­tion in China oc­curs out­side the home – a stark con­trast to the con­sump­tion chan­nels of both pork and poul­try.

“Beef is not a sta­ple meat in China and is con­sid­ered a spe­cial item – this cul­tural men­tal­ity has re­sulted in beef be­ing a niche prod­uct, mak­ing up eight per cent of per capita meat con­sump­tion, com­pared to

The rapid growth of the quick ser­vice restau­rant sec­tor in China is pro­vid­ing an ef­fi­cient chan­nel for in­creas­ing beef con­sump­tion among the young and

wealthy.

22 per cent for poul­try and 65 per cent for pork,” says Costello.

The Chi­nese mid­dle class continues to grow at the stag­ger­ing pace of 27 mil­lion people per year and is cur­rently sit­ting a 300 mil­lion.

“En­cour­ag­ingly, this in­come group had the sec­ond high­est rate of growth for beef pur­chases at 26 per cent be­tween 1998 to 2011, and by 2010 they will rep­re­sent 48 per cent of China’s pop­u­la­tion,” Costello says.

China shifted to a net im­porter of beef in 2010 and im­ports have con­tin­ued to rise, tripling in vol­ume from 20,135 tonnes shipped weight (swt) in 2011 to more than 60,000 tonnes swt in 2012, fur­ther in­creas­ing to 124,000 tonnes swt in the first half of 2013.

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