Ageing population & food safety driving organic sales in Asia

Bio C´Bon organic supermarket in Tokio. Photo © Global Organic Network GON

Largely owing to an increasing ageing population with greater life expectancy than before, Asia’s organic market is undergoing rapid growth. According to the US Organic Trade Association’s (OTA’s) Global Organic Trade Guide, it will witness at least 10% annual growth until 2020. Widespread food safety concerns due to a slew of food scandals that have come to light in recent years is another reason. The growth will be dominated by an increase in organic food and beverage sales.

Many Chinese ask for safe and healthy food - here in the organic supermarket Green & Safe in Shanghai. Photo © Karin Heinze

China, Vietnam and Taiwan will remain significant markets, owing to growing demand for quality and safety-assured products in light of the food safety scandals of the past few years. Another two markets exhibiting promise are Indonesia and India. By 2020, Indonesia’s year-on-year economic growth will surpass that of the rest of the Asia-Pacific region. In this rapidly growing emerging market, the sales of organic packaged food and beverages will reach 9.4% through 2020. India will see demand for organic packaged foods and beverages reach 11.6% by 2020—a strong growth forecast with great potential.

Companies from Sikkim Organic State offer a broad assortment of organic products Photo © Karin Heinze

Food imports continue to grow

While concerns over food safety and quality spur organic demand, import of food products continues to rise. Worldwide, the demand for foreign food imports has seen an average annual increase of 15% and has more than quadrupled in the past 10 years. Edible vegetable oils, cereal and milk products account for roughly half of all food imports. China leads the way, and by 2018, it is expected to become the top importer of foreign food products, with the total value reaching USD 77 bn.

A couple of Danish companies are exporting organic goods to China. Danish Pavilion at BioFach China 2016.

Photo © Karin Heinze

Asia´s ageing population

Many Asian nations face the challenge of a rapidly ageing population. As a result, the demand for natural and organic wellness products is gaining traction with this consumer segment. In China and Japan, the 65+ population will reach 10% and 27.8% of the total population respectively by 2018. At the same time, long life expectancy in many Asian regions, such as Hong Kong, which enjoys one of the highest in the world, is closely linked to an active lifestyle. The trend of ageing well will not only see an uptick in demand for health food and supplements, but also health and fitness supplies and functional foods.

Rural touristic area in the South West of China. Photo © Karin Heinze

Asia goes green

Due to rapid economic development, many Asian nations have growing disposable incomes and are upscaling to greener products. In a study conducted by the Nielsen Company, a global marketing firm, which surveyed 30,000 global online consumers across 60 countries, 55% of the respondents said they are willing to pay more for products provided by companies that are socially and environmentally responsible. Asia-Pacific (64%) had the strongest market for buying eco friendly products (Read the article India: e-commerce is well underway).

Organic Shop is an Indian e-commerce company offering organic foods and cosmetics. Photo Screenshot from the Organic Shop website

Cross-border e-commerce helps increas customers

According to the Global Online Shopping Survey by Pitney Bowes, a global e-commerce solutions provider, 94% of global consumers are frequent online shoppers in local markets, and two-thirds of them also purchased goods online from a non local market in the past year. The Asia-Pacific region is at the forefront, with the highest number of cross-border shoppers hailing from Singapore (89%), Australia (86%) and Hong Kong (85%).

A new joint report by Accenture and AliResearch forecasts that China will continue to be a significant market of cross-border e-commerce. By 2020, over 200 mn Chinese consumers are expected to be cross-border shoppers, with the transaction volume of imported goods purchased online reaching USD 245 bn.

The young generation values good healthy food and looks for natural and organic restaurants like Shanghai´s Green& Safe. Photo © Karin Heinze

Crayon House in Tokio is a big store with natural and organic products and a restaurant.Photo © Karin Heinze

Asian organic market highlights 

• By 2018, China is expected to become the top importer of foreign organic food products, with the total value reaching RMB 480 bn (USD77 bn)

• In China and Japan, the 65+ population will reach 10% and 27.8% of the total population respectively by 2018

• The trend of ageing well will see an uptick in demand for health food, supplements, health and fitness supplies, as well as, functional foods

• Asian countries are seeing greater demand for quality and safety-assured products in light of the food safety scandals of the past few years

• Asian nations have growing disposable incomes and are upscaling to greener products

• In a study conducted by Nielsen, which surveyed 30,000 global online consumers across countries, 55% of the respondents said they are willing to pay more for products provided by companies that are socially and environmentally responsible. The Asia-Pacific (64%) region had the strongest market for buying eco friendly products

• The Asia-Pacific region has the highest number of cross-border shoppers hailing from Singapore (89%), Australia (86%) and Hong Kong (85%)

• By 2020, over 200 mn Chinese consumers are expected to be cross-border shoppers, with the transaction volume of imported goods purchased online reaching USD 245 bn.

Farmers in Himachal Pradesh (India) producing organic vegetables for a box scheme online system. Photo © Karin Heinze

The article is first published in Pure & Eco India. The print magazine is focusing on South Asia’s organic sector, and www.pureecoindia.in is its digital representation.