China is changing how it does business and the shift in thinking from self-sufficiency to trade provides a massive opportunity for beef exporters, given the size of China’s production and population.
This is the message from Hong Kong-based Patrick Vizzone, NABs Regional Head of Food and Agribusiness, speaking at the BeefEx conference on the Gold Coast today.
Mr Vizzone told the conference that the Chinese population had already largely moved from a starch-based diet to one of protein.
The Chinese populations consumption of protein is higher than most people think. In fact, the average proportion of calories obtained from meat is currently higher than Australia and most developed countries.
The next move is replacing pork with higher quality proteins such as beef, and the expectation is for China to increase meat imports as it increasingly leverages the benefits from trade.
Even ripples emanating from China will appear like a tsunami in global markets because total demand there (now and into the future) is vast relative to the size of most other countries production.
Mr Vizzone said that prospective exporters to China need a disciplined, long-term strategy to succeed, as well as alignment with government interests.
Key elements of this are building an understanding of the market and operating environment, and building relationships with trade and investment partners.
That’s generally well understood, but I can’t stress just how important it is. A key risk is rushing to get a deal done without a sustainable strategy.
One option is to start with the more established markets of Taiwan or Hong Kong before taking on China.
Saying that, China is not a single market and you need to plan regional market entry strategies. For example, spending on meat varies greatly by province, with Guangdong by far the greatest spender.
NAB is working with its clients on a number of fronts to establish business partnerships and develop new opportunities in Asia. These include branches in Hong Kong, Shanghai, Singapore, Tokyo, Osaka and Mumbai, as well as representative offices in Beijing, Jakarta and Hanoi. NAB Agribusiness has had a presence in Asia since 1969.