Shanghai June 19, 2018 – The association hosted its annual “China International Nutrition and Health Industry Summit” at the Regal International East Asia Hotel. The agenda boasted 12 expert speakers covering the latest in China’s supplement and ingredient regulations, cross-border e-commerce, WeChat social media, use of KOLs, consumer trends, market environment, import/export status as well as updates on Omega-3 and Probiotics segments and much more.
Summit media partner NutraIngredients-Asia’s Editor in Chief Gary Scattergood revisited his role as summit moderator. As usual, Gary did an excellent job of guiding the flow of the summit as well as posing insightful questions throughout the event and the end of day panel discussion.
Returning speakers China Gate Consulting, Nielsen Group and Euromonitor gave great updates to regulations, consumer trends and overall market conditions. New presenters WalktheChat and Early Data shared valuable information about WeChat social media and e-commerce data mining respectively. The Summit’s partner China Chamber of Commerce’s Zhang Zhongpeng offered valuable government data in regard to the import and export of supplements and ingredients flowing between China and the world.
-149,000 food producers in China, 3,685 food additive producers, 12.8 million business licenses (8.9 million new licenses, 2.7 previous licenses and 1.2 food/beverage licenses.
-2017 food industry sales US$1.6 trillion
-China’s dietary supplement industry began in 1996, as of March 2018 there were 17,457 registered products (“Blue Hat”), 16,684 domestic and 773 imported.
-2,317 health food production licenses in China with a market scale of over US$61 billion.
-Product registration (“Blue Hat”) takes 2-3 years and requires fees of between US$110k – 170K
-Product recording (the so-called “Orange Hat”) takes about 10-12 months and requires fees of between US$16k – 20K
-NSF conducts nearly 200 dietary supplement GMP certification audits annually in China, 1,600 globally.
-Cross border is a growing and valuable channel for international brands, but long-term strategies need to include registration and on the ground partners to succeed
-New dietary supplement recording for vitamins and minerals finished products is a lower cost entry to market (brick & mortar). More complex finished products could focus on cross border as the cost to entry is high.
-Consumer Confidence Index in China continues to break records and is at an all time high
-New growth and opportunities is driven by an aging society and urbanization
-By 2025, those over 65 years of age with increase by over 67 percent compared with 2015 numbers.
-Government is encouraging fitness and healthy eating, so that the growing senior population will hopefully be a healthy one
-What’s important to China’s consumers now is a healthy life with increased environmental protections. Healthy and green products / projects / services will have great opportunities into the foreseeable future.
-Innovation and trade up drives most categories. Companies need to balance short-cycle and long-cycle products to sustain growth
-Global vitamin and dietary supplement industry worth US$96 billion with expected growth to US$127 by 2022
-China, Japan and Korea dominate the Asia Pacific Region with China leading with sales of close to US$20 billion
-WeChat social media active monthly users: 1.04 billion
-WeChat makes up for 35% of Chinese users’ daily usage
-Mobile payments controlled by Alipay 54%, WeChat 38%, Others 8%
-With in country partners, international companies can use WeChat to market and sell to Chinese consumers
-November 2017 e-commerce for supplements hit US$458 million. November is the biggest month for e-commerce sales due to Tmall’s annual “Singles Day Celebration”, which happens on November 11th
-Chinese brand By-Health ( 汤臣倍健) and Swisse are top two e-commerce sellers
-Most leading brands showing triple digit growth on Tmall HK (cross-border)
-Top ingredients by growth rates on e-commerce, collagen, protein powder, calcium, zinc, enzymes, vitamin c, vitamin e, multivitamins, sports nutrition products
-Global probiotic yogurt sales surpassed US$30 billion
-In China, 63 percent of probiotics in Asia Pacific are consumed by eating yogurt, 32 percent from sourmilk/fermented and 5 percent from supplements
-Probiotics in China continue to grow at over double digits since 2012 and represent over 47 percent of all consumption in Asia Pacific
-Total volume of Omega-3 ingredients was over 88,519 metric tonnes
-Total value of Omega-3 ingredients was US$ 1.2 billion
-Concentrated Omega-3s are increasing in sales due to consumers shift away from common refined oils
-2016 Chinese demand for Omega-3s was 12,095 metric tonnes up 6.1 percent
-Retail sales in China is expected to grow by 11.4 percent
-2015 global retail value of consumer products containing EPA/DHA Omega-3s was US$31.4 billion
-Omegaquant’s President Dr. William Harris created its Omega-3 Index test to test the level of Omega-3s in a blood stain sample.
-This test gives consumers a valuable tool in knowing if their Omega-3 intakes are sufficient
-Omegaquant will launch the test in China later this year, which will give industry a great tool to share with their customers.
SEE YOU NEXT YEAR