China Food Industry: “Give them the Guts”

Excerpt from an interview to David Caselli, CEO New Zealand China Direct Ltd, a New Zealand owned WFOE importing and distributing food and beverages into the Chinese market.

Key Message on the Opportunities in the Food Business in China:
Although there are undeniable opportunities in the high end segment, the real breakthrough will be accessing the mass market with meat/fish & seafood derivative products and low end cuts that do not create value back home but are processed here into highly appreciated products in China.

Excerpts from the interview
“The average wage in China keeps rising and consequently massive parts of the Chinese community will be able to switch into eating more protein. It does not mean they are going to eat caviar and lobster … what they will be doing is eating more fresh meat instead of cabbage. So the biggest opportunity for us is not to sell high end lamb cuts but to sell a lamb derivative product that fits the market for the 9$ /day people… It is relatively easy to sell lamb to Western restaurants. The real challenge for us is to find out how to create products that use New Zealand lamb in Chinese dishes in Chinese restaurants. There are 20 million people in Shanghai and 400.000 foreigners. I’d rather sell to the 20 million than to the half million.

New Zealand meat industry sells some 500 million dollars a year of low end lamb cuts to China. Here it goes to a couple of provinces where they create a lamb roll (press it, add some duck fat…) which the Chinese mass eats. We have a whole lot of protein types that we don’t extract value from so the real opportunity is to unlock the value that works in China out of them.

Same holds true for other products. Seafood, for example, is there an opportunity to sell what we do not use but is appreciated here? There is also a mass market for fish frames, just heads, tails and bones. They process it and convert that into something useful.

Back in New Zealand we don’t understand the Chinese well enough to be able to identify what those products are (both in meat and fish). We need producers to get into thinking what are the uses and applications of the whole animal in China. Don’t get me wrong, they’ve probably been thinking about this for decades… what they’ve probably not done is come here and stay long enough to find the answer.”

Do you share his views?

One comment