Demand for processed food drives China’s chilled produce sector

By Mike Stones

- Last updated on GMT

Related tags Food China

Rising demand for processed and packaged foods in China is fueling growth in the country’s chilled food produce sector, according to the latest report from Reportlinker.

Its new study, Chilled Food in China 2009: A Market Analysis, estimates that the nation’s retail sales of chilled foods will grow to 1.23m tonnes by the end of this year; up 115 per cent compared with 2003. The compound annual growth rate over this period is estimated at 11.55%.

The total market value for chilled foods in China grew by 147 per cent but the rate of growth fluctuated considerably. The compound annual growth rate is estimated at 13.79%.

The report attributes this growth to increasingly sophisticated and wealthy urban consumers and better distribution networks.

Expensive chilled foods

“People are now able to buy more expensive chilled foods than before, leading to greater demand for variety and quality of products,”​ according to the report.

As incomes and lifestyles improve, Chinese consumers are reportedly enjoying a more varied diet and cooking with a wider variety of products after watching the proliferation of cookery programmes on Chinese television.

Big improvements in China`s transport network, stimulating distribution chains, have also played a key part in fueling regional trade in chilled processed and packaged food produce.

Big growth in consumer demand has prompted manufacturers to introduce greater efficiencies into their organizations, notes the report.

Chilled food in China is sold mainly through new retail formats such as supermarkets and hypermarkets, it says. “Organised supermarket chains are gaining significance as sellers of chilled foods, and are at the vanguard of spreading distribution of these products into more parts of the country.”

But, rising demand for chilled foods is threatened by concerns about food safety. “Frequent food safety scares, especially related to hygiene, disease and the use of rapid growth hormones, have all added to consumer nervousness about the food that they buy, and these issues have the potential to seriously harm the chilled food market,”​ warn the report’s authors.

Refrigerator ownership

The report noted that the ownership of refrigerators was only 26.12 per 100 rural households in 2007, compared with 95.03 in urban households.

The report also features information on leading manufacturers’ market shares based on revenues to 2008; volume and value forecasts of the Chinese market up to 2014; marketing and distribution; key manufacturer profiles and key contacts and trade events.

Priced at 1,256 euros, the report, Chilled Food in China 2009: A Market Analysis is available from Report Linker

Related topics Processing & Packaging

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