Chinese New Year leading to 'explosive growth' for high-end seafood : February 5, 2019
Shrimp, crab and lobster are all beginning to feature heavily on dinner plates and in festive gift boxes, Chinese seafood execs told IntraFish.
Rachel Mutter : Intrafish
Imported, high-end seafood is increasingly taking a place at the Chinese New Year (CNY) dinner table during a month-long period of buying where the Chinese spend triple their daily expenditure, Chinese executives told IntraFish.
“In our parents’ generation, probably meat was considered as the premium category for CNY celebration,” Shirley Shen, marketing manager at Alibaba supply chain subsidiary Win-Chain told IntraFish. “But now, due to consumption upgrades and health consideration… we see a clear growth of sales in the seafood sector every year before the CNY.”
Indeed, statistics from Kantar China show a sharp spike in seafood spend coinciding to the run up to Chinese New Year, which this year falls on Feb. 5.
“As Chinese people’s economic level gets higher and higher, they will enjoy more and more food,” said Siam Canadian Guangzhou Domestic Sales Manager, Luozhao. And that means expansion beyond chicken, duck and traditional whole carp.
Variety, the spice of life
Not only are Chinese families spending more on seafood at Chinese New Year, the variety of imported and premium categories such as lobster and king crab is also increasing, according to Shen.
Luzhou agrees. In the past two years, large-scale imports of shrimp, as well as high-end lobster, king crab and salmon have witnessed “explosive growth,” especially in China’s inland areas, where acceptance of seafood is increasing.
This is in part down to the symbolism that links Chinese culture and food.
“Either cooking at home or dining out, fish is always part of the CNY dinner because it represents abundance in a Chinese idiom,” said Shen, referring to the the Chinese word for fish “yu,” which sounds very much like the Chinese word for “abundance.”
Red is also considered lucky at CNY, so food like crab, lobster, shrimp and salmon have all become popular.
The season of giving
Gift giving is also a key seafood opportunity at this Chinese holiday. Chinese New Year gifts tend to take the form of ornately packaged fruit, pastries, alcohol and other consumer goods, but they are now increasingly including seafood.
“[Today] gift-giving in China is not limited to tobacco and alcohol products. High-end [seafood] gift bags have become an important part,” said Luozhao.
These gift packs are a huge boon for Qingdao-based processor Chang International, who sees a third of its annual seafood gift presentations sold in the month leading up to Chinese New Year, CEO Jerry Chang told IntraFish.
The gift packages contain varieties of fish and shellfish products and “fly off the shelves” in Chinese supermarkets and online retail platforms, said Chang.
As an example, Win-Chain’s Shirley Shen noted that the group co-operated with a supplier this year to create a customized pollock gift box on Tmall, “which was rather popular among Chinese consumers.”
Macro trend for safe food
The over-riding theme in this seafood consumption increase, particularly in China’s inland cities, comes, according to all sources IntraFish spoke with, from a general desire for healthy, safe food.
“The biggest change with the past is that dietary concepts are changing, not only to eat and eat, but also to be healthy, and food products are becoming more and more diversified,” said Luzhou. “The demand for high-end products is increasing, and the domestic demand is growing.”
As both an importer and exporter, companies like Siam Canadian win on both fronts.
“As a supplier, many products cannot be satisfied by domestic farming, and the domestic farming cost is very high, so the demand of purchasing from abroad is growing,” Luzhou told IntraFish. “So in recent years, we have been exploring the Chinese market, hoping to provide better and more diversified seafood to China.”
As a buyer too, the shifting dynamics in the Chinese market offer opportunities.
“With the cost of farming, labor costs and domestic demand, many domestic products are not competitive in the international market, so a lot of factories that were once focused on export have also turned to the domestic market,” said Luozhao. “This has also allowed us to either procure domestically or from imports for our domestic sales.”
Where, when and how
In terms of where consumers shop for Chinese New Year, all channels are covered.
Fresh food is from fresh markets and supermarkets, and snack food is from supermarkets and e-commerce, Shen told IntraFish.
The majority of shoppers still go to nearby markets so they can hand-select seafood, but Win-Chain has also seen a trend of more sophisticated buyers using online channels like Tmall, or new retail channels like Hema.
“Following the trend of data-driven ‘New Retail,’ you can see the fresh category is playing a more key role more than ever before,” said Shen.
“China is pushing for more imports in recent years, and Alibaba has responded accordingly. Fresh food agri-products is one of the core categories in our import strategy.”