SunGold is proving a favourite with Chinese consumers. Photo / Supplied
SunGold is proving a favourite with Chinese consumers. Photo / Supplied
When New Zealand signed its free trade agreement with China in 2008 exports to that country totalled $2.1 billion and by year end September last year were worth $16.6 billion, almost twice what is sold to the United States.
The huge surge in exports post FTA to China represented one of the largest shifts in trade focus New Zealand had ever witnessed, and showed little sign of abating as the Chinese government lifted almost 10 million people a year out of poverty, Bayleys said in a statement.
New Zealand's primary sector had undoubtedly been one of the biggest winners from this concerted effort to improve the lives of Chinese people as the nation rocketed towards claiming a middle class totalling almost 500 million.
In the early days of the FTA dairy was one of the biggest winners for export demand as Chinese strove to secure safe, high volume supply of the protein source vital for products including infant formula.
It provided New Zealand with a valuable high volume foothold in the market, backed by its reputation as a safe food source.
Today the Chinese market was more sophisticated and Chinese authorities had made efforts to lift the standard of their own domestic supply through greater regulations on food safety, and consolidation of farming operations into larger scaled high volume operations.
Dairying in particular was witnessing a major effort to push small scale operators out of production consolidating into large 5000 cow-plus operations running United States-style operations milking three times a day with complete ration controlled indoor systems.
Processor ownership of dairy farms, by companies including Yili and Mengniu had assured a "two step" integration from cow to final consumer, as the government aimed to minimise food safety risks after crises including the melamine disaster in 2008.
The result was a surge in the number of quality domestic brands for consumers to choose from, packaged and presented to easily rival any overseas brand for choice and quality.
Rising choices and quality products were linked through purchasing apps to a population of 1 billion smartphone users.
The food industry was now a rapidly changing market where 40 per cent of purchases were made online, well ahead of New Zealand at under 10 per cent.
But despite the choice and intensity of the market, New Zealand food exporters remained optimistic about the opportunities this increasingly sophisticated market offered, Bayleys said.
SunGold is proving a favourite with Chinese consumers. Photo / Supplied
Zespri said it was anticipating another strong year of sales in the country as this year's harvest kicked off, with China now accounting for 15 per cent of its sales.
As more SunGold orchards came on stream at the rate of 700ha of additional orchards a year, much of the expected growth would come from the SunGold variety and exported to China.
Ivan Kinsella, Zespri China's corporate affairs manager said the marketing company now had integrated control over importation of the fruit, ensuing rapid transit across Chinese wharves on arrival, and closer relationships with key account clients.
SunGold was proving a favourite with Chinese consumers who identified with the fruit, were familiar with it, knew it was healthy for them and enjoyed the taste profile it had.
Meantime the Green variety had a strong following among the growing band of urban fitness seekers buying it for its high vitamin C level, health benefits and lower price.
Bayleys said horticulture continued to establish a place in high end Chinese supermarkets, with Rockit apples packaged in their trademark rocket pack recently gaining space in supermarkets.
The apples held strong appeal to Chinese mums seeking snack-sized fruit that met their expectation of high quality, nutritive and convenient food source.
The range of horticultural products offered in China from New Zealand continued to expand, with avocados making their debut this season, and New Zealand cherries finding a foothold in the high-end market.
Dairy is becoming big business in China. Photo / Supplied
As infrastructure had improved, along with consumers' expectation of same day, or in some cases one-hour delivery, so too had demand for fresh products over the traditional frozen or dried.
New Zealand-based Chinese owned companies Oravida and Theland had established valuable shelf space in high-end supermarkets including Alibaba's new supermarket Hema and Ole' with air-freighted New Zealand milk.
Selling for up to NZ$15 a litre, a regular air freight service had Theland selling 40,000 litres a week into the large urban markets, with plans to expand that to 100,000 litres.
Bayleys country manager Duncan Ross said New Zealand's primary sector was starting to establish itself as a high-end food bowl for China, meeting the needs of a population that had become more discerning and wealthy in a relatively short time.
"This should give confidence to anyone seeking to invest in the primary sector, and particularly in pastoral or horticultural land that the investment is underpinned with strong market prospects.
"It is something we are seeing reflected in the good prices being paid for well-located pastoral land and productive, well managed orchard operations."
