Sector Trend Analysis - Meat Trends in China

February 2018

Executive summary

China was the largest meat producer: 76.4 million tonnes in 2016 and consumer: 65.6 million tonnes in 2016 in the world with the top three categories being pork, chicken and beef. China was the world’s largest market for meat importing US$10.3 billion in 2016, which represents 9% of the global meat import worth US$113 billion.

China was Canada’s second-largest meat importer after the U.S. in 2016 worth US$626 million or 321,764 tonnes, which was 0.5% of the total volume of meat consumed in China. That represents a compound annual growth rate (CAGR) of 23% in volume from 2012 to 2016 and ranks Canada as China’s sixth-largest meat supplier in volume. Also China continues to be Canada’s second-largest export market for agri-food and seafood products.

Demand for meat in China continues to rise both in quantity and quality. With local meat supply constrained by land, feed, and water and supply chain issues, China will continue to import a significant proportion of meat from the world.

Contents

China’s meat production

China is a major player in the world meat industry in terms of production, consumption and trade in recent years.

China meat production by year

China’s meat production reached its second highest peak in history. China produced 76.4 million metric tonnes of meat (pork, chicken and beef) in 2016 among which 56.5 million metric tonnes were pork, 13.1 million metric tonnes were chicken and 6.8 million metric tonnes were beef. Based on data records back to 1988, meat production had a steady increase from 1988 to 2016 to meet the high demand from Chinese customers whose living standard has improved significantly over the past twenty nine years.

China’s meat production 2012 to 2016 ‘000 tonnes
Category 2012 2013 2014 2015 2016
Pork 53,427 54,930 56,710 56,375 56,500
Chicken 13,700 13,350 13,000 13,025 13,100
Beef 6,623 6,730 6,890 6,750 6,785
Total 73,750 75,010 76,600 76,150 76,385

Source: beef2live - China Meat Production By Year.

China’s trade summary

Among the top ten meat suppliers to China by value, Canada was ranked in tenth place, worth US$491 million compared with the biggest meat exporter, Brazil, at US$1.75 billion. Canada represented 5% of the total world meat export value to China. Due to the strong demand from the market in China, nine of the top ten meat exporters gained steady compound annual growth rate (CAGR) between 15% and 55% from 2012 to 2016. However, the U.S. had a negative compound annual growth rate of -13% during the same period.

Top ten meat suppliers to China by value in US$ million 2012 to 2016
Rank Country 2012 2013 2014 2015 2016 *CAGR 2012-16
World 4,334 5,657 5,699 6,735 9,493 22%
1 Brazil 574 446 521 1,094 1,757 32%
2 Germany 291 320 339 597 983 36%
3 Hong Kong 435 172 337 126 784 16%
4 Australia 411 1,179 1,057 988 712 15%
5 New Zealand 334 724 883 855 698 20%
6 Spain 169 188 253 365 687 42%
7 United States 1,002 1,061 705 336 585 -13%
8 Uruguay 99 323 345 542 572 55%
9 Denmark 305 319 314 396 539 15%
10 Canada 239 278 220 370 491 20%

Source: Global Trade Tracker, 2017.

*CAGR: Compound Annual Growth rate.

Top ten meat suppliers to China in metric tonnes 2012 to 2016
Rank Country 2012 2013 2014 2015 2016 *CAGR 2012-16
World 2,325,441 2,555,236 2,525,395 2,822,552 4,593,022 19%
1 Brazil 247,359 191,991 228,505 409,824 738,220 31%
2 Germany 175,115 199,442 214,748 380,619 595,058 36%
3 Spain 99,388 106,093 138,948 210,080 388,480 41%
4 Hong Kong 344,039 130,120 241,420 74,865 385,978 3%
5 United States 623,942 637,260 423,749 184,708 337,460 -14%
6 Canada 139,355 167,534 133,759 160,672 321,766 23%
7 Denmark 189,634 186,760 192,182 232,519 301,747 12%
8 Netherlands 19,085 109,63 49,462 110,570 238,629 88%
9 New Zealand 94,824 188,708 210,959 226,087 212,676 22%
10 Australia 108,216 288,420 254,803 240,196 190,180 15%

Source: Global Trade Tracker, 2017.

*CAGR: Compound Annual Growth rate.

Among the top ten meat suppliers to China by volume, Canada was ranked sixth, exporting 321,766 tonnes, representing 7% of the total world export to China. Canada gained a compound annual growth rate of 23% while the Netherlands reached the highest compound annual growth rate at 88% among top ten suppliers from 2012 to 2016. Again the U.S. was the only exporter who had a negative compound annual growth rate of -14% from 2012 to 2016.

Top ten meat products by HS code Canada exported to China in US$ million 2012 to 2016
HS code Description 2012 2013 2014 2015 2016
Total 239 278 220 370 491
02032900 Frozen swine cuts 88 116 92 93 271
02064900 Frozen swine edible offal 113 94 67 52 100
02032200 Frozen hams, shoulders and cuts of swine, bone in` 13 27 15 18 61
02023000 Frozen bovine cuts boneless 4 24 35 192 44
02091000 Pig fat, lean meat free, frozen/chilled/salted/in brine/dried/smoked 2 1 1 0 5
02031220 Fresh or chilled pork shoulders and cuts, bone in 6 7 2 7 3
02101110 Pork hams and cuts thereof, bone in, cured 0 0 0 0 2
02062900 Frozen bovine edible offal 0 1 0 0 1
02032100 Frozen swine carcasses and half carcasses 0 0 0 0 1
02064100 Frozen swine livers, edible offal 0 0 0 0 0.6

Source: Global Trade Tracker, 2017.

Canada’s total meat exports to China in 2016 were US$491 million of which frozen swine cuts accounted for US$271 million, nearly tripling from 2015 to 2016 while frozen swine edible offals accounted for US$100 million, doubling from 2015 to 2016. The top meat products are mainly pork, beef and their offals.

Top ten meat products Canada exported to China in metric tonnes 2012 to 2016
HS code Description 2012 2013 2014 2015 2016
Total 139,356 167,534 133,759 160,673 321,764
02032900 Frozen swine cuts 53,264 74,826 61,401 70,429 198,186
02064900 Frozen swine edible offal 66,058 58,297 48,668 37,462 68,539
02032200 Frozen hams, shoulders and cuts of swine, bone in 8,455 19,505 11,591 13,752 38,426
02023000 Frozen bovine cuts boneless 1,334 5,425 6,421 31,981 5,895
02091000 Pig fat, lean meat free, frozen/chilled/salted/in brine/dried/smoked 1469 617 300 598 4928
02031220 Fresh or chilled pork shoulders and cuts, bone in 2,456 3,301 909 3,175 1,305
02101110 Pork hams and cuts thereof, bone in, cured 0 130 27 26 828
02064100 Frozen swine livers, edible offal 204 181 256 205 705
02032100 Frozen swine carcasses and half carcasses 26 63 56 0 635
02062900 Frozen bovine edible offal 0 687 0 0 572

Source: Global Trade Tracker, 2017.

Canada exported 321,764 tonnes of meat to China in 2016 of which frozen swine cuts accounted for 198,186 tonnes, almost tripling from 2015 to 2016, while frozen swine edible offal accounted for 68,539 tonnes, a big increase from 2015 to 2016. “Frozen hams, shoulders and cuts of swine, bone in” almost tripled from 2015 to 2016.

Consumption and spending

The total volume of meat consumed in China reached 65.6 million tonnes rising slightly in 2016. Pork was the largest volume of meat consumed in China in 2016: 40.8 million tonnes representing 62% of the total meat consumption, then poultry: 14.1 million tonnes, beef: 5.86 million tonnes, lamb, mutton and goat: 3.55 million tonnes. Pork consumption in 2016 went down compared to the consumption in 2013, 2014 and 2015 while all other meat consumption went up from 2012 to 2016. This is due to the fact that consumers’ increasing awareness led them to make conscious decisions to consume less pork or shift to other types of meat or seafood as a protein source.

Historical **total volume sales of meat by category 2012 to 2016 ‘000 tonnes
Category 2012 2013 2014 2015 2016 *CAGR 2012-16
Pork 40,090.3 41,293.0 42,490.5 41,300.8 40,846.5 0%
Poultry 13,143.2 13,590.1 13,223.1 13,765.3 14,068.1 2%
Beef and Veal 4,855.4 5,112.7 5,368.4 5,615.3 5,856.8 5%
Lamb, Mutton and Goat 3,220.3 3,310.5 3,396.6 3,478.1 3,554.6 2%
Other Meat 1,133.0 1,155.7 1,177.6 1,202.4 1,226.4 2%
Total Meat 62,442.2 64,462.0 65,656.2 65,361.8 65,552.3 1%

Source: Global Trade Tracker, 2017.

*CAGR: Compound Annual Growth rate.

Note: **Total volume sales: encompasses retail, foodservice, and institutional sales (e.g. school/hospital) defined by Euronomitor.

From 2012 to 2016, total volume sales of meat grew at a compound annual growth rate of 1%. Beef and veal gained the highest compound annual growth rate of 5%. Lamb, mutton and goat, poultry and other meat all grew at a compound annual growth rate of 2%. Pork had very modest growth, but was the largest category.

Forecast **total volume sales of meat by category 2017 to 2021 ‘000 tonnes
Category 2017 2018 2019 2020 2021 *CAGR 2017-21
Pork 40,805.6 41,132.1 41,420.0 41,668.50 41,835.2 1%
Poultry 14,349.5 14,550.4 14,739.5 14,901.70 15,050.7 1%
Beef and Veal 6,079.3 6,273.8 6,462.1 6,636.50 6,809.1 3%
Lamb, Mutton and Goat 3,629.2 3,698.2 3,761.1 3,821.20 3,878.6    2%
Other Meat 1,248.5 1,268.4 1,290.0 1,309.40 1,326.4 2%
Total Meat 66,112.1 66,922.9 67,672.7 68,337.30 68,899.9 1%

Source: Euromonitor International.

*CAGR: Compound Annual Growth rate.

Note: **Total volume sales: encompasses retail, foodservice, and institutional sales (e.g. school/hospital) defined by Euronomitor.

It is forecast that by 2021, the total sale of meat in China will reach 68.9 million tonnes which is a 3.3 million tonne increase from the volume in 2016. Beef and veal will continue to have the highest compound annual growth rate of 3%, followed by lamb, mutton and goat as well as other meat all at a compound annual growth rate of 2%. Pork and poultry have a compound annual growth rate of 1%. Canada should continue to seize this growth opportunity to export more meat to China.

Historical retail sales of meat by category: value in US$ billion 2012 to 2016
Category 2012 2013 2014 2015 2016 *CAGR 2012-16
Pork 101.6 106.9 112.7 112.9 127.5 6%
Beef and Veal 12.2 13.1 14.1 15.1 16.1 7%
Poultry 12.0 12.7 13.3 14.1 14.8 5%
Lamb, Mutton and Goat 7.1 7.5 7.8 8.2 8.5 5%
Other Meat 1.3 1.4 1.4 1.5 1.6 5%
Total Meat 134.3 141.6 149.4 151.8 168.4 6%

Source: Euromonitor International 2017.

*CAGR: Compound Annual Growth rate.

China’s retail sales of meat reached US$168.4 billion in 2016 and grew at a compound annual growth rate of 6% from 2012 to 2016.

Historical retail sales of meat by category: volume 2012 to 2016 ‘000 tonnes
Category 2012 2013 2014 2015 2016 *CAGR 2012-16
Pork 24,025.9 24,628.2 25,264.3 24,809.5 24,784.7 1%
Poultry 4,337.3 4,444.0 4,572.1 4,709.3 4,860.0 3%
Beef and Veal 1,602.3 1,671.9 1,750.1 1,841.1 1,940.5 5%
Lamb, Mutton and Goat 1,062.7 1,082.5 1,107.3 1,136.1 1,167.9 2%
Other Meat 373.9 377.9 383.9 390.8 398.6 2%
Total Meat 31,402.0 32,204.4 33,077.7 32,886.8 33,151.7 1%

Source: Euromonitor International 2017.

*CAGR: Compound Annual Growth rate.

Total retail sales of meat in China in 2016 were 33.2 million tonnes. Pork continued to be the most popular type of meat with the retail sales of 24.8 million tonnes followed by poultry with 4.9 million tonnes, beef and veal with 1.9 million tonnes, lamb, mutton and goat with 1.2 million tonnes. The compound annual growth rate for beef and veal from 2012 to 2016 was the highest: 5% followed by poultry: 3%, lamb, mutton and goat as well other meat: 2%. The compound annual growth rate for pork was the lowest: 1% same as the compound annual growth rate for the total meat from 2012 to 2016.

Forecast retail sales of meat by category: volume 2017 to 2021 ‘000 tonnes
Category 2017 2018 2019 2020 2021 *CAGR 2017-21
Pork 25,007.8 25,457.9 25,890.7 26,305.0 26,673.2 2%
Poultry 5,030.1 5,216.2 5,414.4 5,631.0 5,861.9 4%
Beef and Veal 2,047.2 2,163.9 2,289.4 2,426.8 2,574.8 6%
Lamb, Mutton and Goat 1,202.9 1,240.2 1,282.4 1,329.8 1,383.0 4%
Other Meat 407 416.4 426.4 437 448.8 2%
Total Meat 33,695.0 34,494.6 35,303.3 36,129.6 36,941.8 2%

Source: Euromonitor International 2017.

*CAGR: Compound Annual Growth rate.

The retail sales of meat in 2021 will reach 36.9 million tonnes, which is a 3.8 million tonne increase from the retail sales in 2016. Again beef and veal will have the highest compound annual growth rate of 6%, then poultry at 4%, lamb, mutton and goat at 4%, other meat at 2% and pork at 2%.

Retail sales of organic meat: volume 2012 to 2016 ‘000 tonnes
Category 2012 2013 2014 2015 2016 *CAGR 2012-16
Organic Meat 109.9 115.9 129 138.1 149.2 8%

Source: Euromonitor International 2017.

*CAGR: Compound Annual Growth rate.

It is worth noting that organic meat in China became increasingly popular with a compound annual growth rate of 8% in retail sales from 2012 to 2016. Chinese consumers demanded more organic products even at higher prices due to the increasing awareness and popularity of these products.

Retail meat unit prices in US$ per kg 2015 to 2016
Categories 2015 2016
Meat 4.86 5.27
Beef and Veal 8.62 8.59
Lamb, Mutton and Goat 7.60 7.50
Pork 4.79 5.33
Poultry 3.14 3.16
Other Meat 4.05 4.06

Source: Euromonitor International, 2017.

Note: Data available only as of 2015.

Beef and veal were the most expensive items at US$8.59 per Kg in 2016. Poultry was the cheapest meat at US$3.16 per Kg in 2016.

China’s expenditure on meat per capita in US$ 2012 to 2016
Category 2012 2013 2014 2015 2016
Meat 99.70 104.60 109.80 111.00 122.50
Beef and Veal 9.10 9.70 10.30 11.00 11.70
Lamb, Mutton and Goat 5.30 5.50 5.80 6.00 6.20
Pork 75.40 79.00 82.80 82.60 92.80
Poultry 8.90 9.40 9.80 10.30 10.80
Other Meat 1.00 1.00 1.10 1.10 1.10

Source: Euromonitor International, 2017.

Per capita spending on meat by Chinese consumers was US$122.5 in 2016, up from US$111.0 in 2015 and it is projected to reach US$160.0 in 2020.

Consumer foodservice in China

With 1.38 billion Chinese people, representing one fifth of the world’s total population, China is the largest global market for fresh meat. Almost 50% of the meat consumed in China in 2016 was through foodservice and institutions. In China, restaurants are crucial not only to social and cultural life, but also to work and business success, traditionally and contemporarily.

Group buying in consumer foodservice catering is popular. Group buying occurs when a company offers products and services at significantly reduced prices, on the condition that a minimum number of buyers are willing to purchase the same item. This trend was due to the rapid development of e-commerce platforms such as Alibaba through its Alipay, the online payment system which was also launched in Canada on Sept. 25, 2017 to enable Canadian retailers to accept Chinese currency from Chinese shoppers through a mobile wallet. Seven hundreds Canadian merchants already accept Alipay which increases the opportunity of Canadian merchants to expand their market to China.

Distribution of meat by format in (%) 2012 to 2016
Format 2012 2013 2014 2015 2016 *CAGR 2012-16
Retail 50.3 50 50.4 50 50 0%
Foodservice 27.9 28 28.2 28 28 1%
Institutional 21.8 22 21.4 22 22 1%
Total 100 100 100 100 100 0%

Source: Euromonitor International, 2017.

*CAGR: Compound Annual Growth rate.

The foodservice sector continues to be the dominant buyer of beef and veal products, as Chinese middle class consumers are less used to cooking beef compared to pork, and with busy lifestyles, they tend to choose beef over other proteins when they eat out.

Top Chinese meat import by port of entry

China, meat import from the world by top ten ports of entry, US$ million 2012 to 2016
Port of entry 2012 2013 2014 2015 2016
Shanghai 808 1,170 1,143 1,836 2,722
Tianjin 889 1,417 1,425 1,843 2,703
Guangzhou 248 280 413 326 1,187
Shenzhen 685 753 714 951 1,165
Dalian 719 1386 1218 603 693
Qingdao 107 168 246 332 452
Nanjing 230 313 272 290 262
Ningbo 1 3 15 63 123
Zhengzhou 0 0 0 0.75 120
Hefei 0 3 1 0 102

Source: Global Trade Tracker, 2017.

Shanghai, Tianjin and Guangzhou were the top three ports of entry for meat from the world representing 64% of China’s total meat imports: US$10.3 billion from the world in 2016.

China, meat import from Canada by top ten ports of entry, US$ 2012 to 2016
Port of entry 2012 2013 2014 2015 2016
Tianjin 121,499,209 169,103,465 128,480,735 133,666,067 273,505,999
Shanghai 21,862,885 36,556,436 30,871,455 46,898,553 95,651,636
Guangzhou 22,721,235 23,334,933 21,669,446 16,294,210 81,985,002
Nanjing 9,828,057 18,175,138 7,716,376 77,751,727 51,115,700
Shenzhen 10,010,704 6,192,714 5,902,395 18,774,659 35,433,578
Dalian 41,501,433 105,463,054 47,956,616 47,509,599 34,923,869
Beijing 0 26,619 0 31,421 21,044,366
Qingdao 5,240,014 9,685,589 5,176,336 4,310,360 19,545,068
Xiamen 10,181,666 3,408,044 3,154,169 3,994,048 3,291,099
Huangpu 1,067,966 0 0 2,554,225 3,053,295

Source: Global Trade Tracker, 2017.

Tianjin, Shanghai and Guangzhou again were the top three ports of entry for meat from Canada representing 72% of China’s total meat imports: US$626 million from Canada in 2016.

Conclusion

Demand for meat in China continues to rise both in quantity and quality. With local meat supply constrained by land, feed, and water and supply chain issues, China will continue to import a significant proportion of meat from the world. The 15th China International Meat Industry Exhibition (CIMIE 2017) organized by China Meat Association (CMA) and International Meat Secretariat (IMS) was recently held in Qingdao, October 18-20, 2017. Canada will have a Pavilion at Food and Hospitality China to be held in Shanghai November 14-16, 2017 to showcase meat and other products.

China's meat market had a growth of 2% between 2011 and 2016, and is forecast to increase to a compound annual growth rate of 4% in 2021. With a tradition of cooking and eating a variety of foods, Chinese people are the world’s largest customers for meat. China’s economic conditions have facilitated growth through increased certainty for business and consumer spending confidence. Technological gains particularly in e-commerce and stronger spending power make China a promising market, not only for the meat sector, but also for other sectors of higher value.

For more information

International Trade Commissioners can provide Canadian industry with on-the-ground expertise regarding market potential, current conditions and local business contacts, and are an excellent point of contact for export advice.

For additional intelligence on this and other markets, the complete library of Global Analysis reports can be found under Statistics and Market Information, arranged by sector and region of interest.

For additional information on Food and Hospitality China (FHC) 2017, please contact:

Ben Berry, Deputy Director
Trade Show Strategy and Delivery
Agriculture and Agri-Food Canada
ben.berry@canada.ca

Resources

Sector Trend Analysis - Meat Trends in China
Global Analysis Report

Prepared by: Hongli Wang, Market Analyst

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