BioFach China networks supply and demand

Debut in Shanghai: Exhibition and supporting programme

Raw materials in the land of unlimited opportunities

Domestic market is interesting sales market

Picture: BioFach China 2006

“Take your life to organic”. This slogan of an organic supermarket chain in China could also be the motto for BioFach China, which takes place in the Everbright Exhibition Centre in Shanghai for the first time from 31 May to 2 June 2007. The preparations are in full swing and there are no reasons why the premiere should not be a success: NürnbergMesse China expects approx. 200 exhibitors. The worldwide market for organic food and natural products has developed excellently in the past years and is increasingly picking up speed. The two-figure growth rates in sales of organic products in Europe and the USA compare with only a slightly rising number of organic producers. Result: As in so many other sectors, the West is also looking to China for organic raw materials – and a lot is happening there.

Alone the fact that the People’s Republic with 4.1 million hectares of certified organic land took over second position behind Australia in the worldwide ranking in 2006 makes it clear just how dynamically organic farming is developing in China. The United Nations International Fund for Agricultural Development (IFAD) already sees China as a future large-scale producer of organic raw materials and products. Besides the rapid expansion of the organic land areas, this forecast is supported by the fact that the government is pushing the development of organic agriculture. Those responsible have recognized a real chance of linking organic production with value creation, environmental protection and the fight against poverty.
 
According to reports, the government’s White Book on the Development of Chinese Agriculture already contains plans for setting up national production bases for organic food with the aim of producing organic food on a large scale for export. Moreover, many small farms which mostly manage without the use of fertilizers or pesticides for cost reasons are predestined for conversion to organic farming. “Organic farming is still in the development phase in China, but it will flourish in the next ten years,” Xiao Xingji, Director of the Organic Food Development Centre in the Environment Ministry, is quoted as saying.

The potential for producing organic food really does appear to be tremendous in China. Almost a million hectares of farmland are currently farmed with organic methods, over two million hectares are used for certified collection from the wild and some 700 farms are in the process of conversion. About 1,600 processing companies are certified to official regulations. The number of certification organizations has increased by more than five times since a national organic label was introduced in 2005. Over 30 such accredited certification centres are established in China – an indicator of the enormous dynamic.

China will play a major role in future as supplier of raw materials for the growing demand for organic products throughout the world. An export turnover of approx. 350 million US dollars (2005) is quite remarkable for a newcomer to the organic market. In order to meet the high quality requirements of the buying countries in Europe and the USA, many processing companies are currently investing on a massive scale in plant and quality assurance systems. The choice of products is also being broadened. Besides the classic agricultural raw materials like corn, oilseeds or legumes, the product spectrum includes herbs, mushrooms, nuts, honey and tea. Organic milk products, eggs, meat and fish have also been added recently.

The latter is mainly very important for the increasing demand from the domestic market. The growing interest of Chinese consumers is unmistakeable. National consumption is about 300 million US dollars. 
 
The future promises impressive growth: The population (1.3 billion) is growing by 10 million people a year. Of these, about 50 million households currently count as middle class. According to estimates, the average annual income will have doubled to about 18,000 US dollars by 2010 and create a strong rise in the standard of living, which in any case is already approaching Western standards in the cities. This is noticeable in that a quite considerable number of consumers are prepared to accept a price for organic food that is 50 to 300 per cent above conventional products.

A number of retail trade concepts are profiting from the growing demand. National stores like Planck Organic or Lohaocity and international chains like Carrefour offer organic products. In many cases, however, they are forced to import brand products from abroad, because the local organic companies do not yet have a suitably large range to satisfy consumers’ wishes. Especially natural cosmetics are considered to have brilliant prospects.

Very good conditions for an organic exhibition like BioFach China, for which networking supply and demand is one of the main concerns. This exhibition of NürnbergMesse China now faces its premiere and will function as a start block for a quality-orientated organic market in the economic boom country of China. The exhibition for organic food and certified natural products will be opened on 31 May by representatives of the Chinese Greenfood Development Center, the German Embassy, the International Federation of Organic Agriculture Movements IFOAM, the Deutsche Investitions- und Entwicklungsgesellschaft DEG and Nürnberg Global Fairs.

The service package that Nürnberg Global Fairs offers international exhibitors covers a large spectrum of services ranging from shipment of goods to walk-on exhibition stand, plus help with booking accommodation in the hotel next to the Everbright Exhibition Centre.
 
For companies wishing to establish more intensive contact with the Chinese organic market beyond BioFach, the Munich consulting company Organic Services offers a fact-finding tour in cooperation with NürnbergMesse China. The five-day programme includes a visit to the exhibition, followed by a tour of the country tailored to the individual needs of the participants. This offers travellers the opportunity of finding out more about organic production, processing and trade in China. Nürnberg Global Fairs will be pleased to provide more information about the tour.

Contact for exhibitors: 
Till Ahnert, Nürnberg Global Fairs, Messezentrum, 90471 Nürnberg, Germany,

Tel +49 (0) 911- 8606-86 92  till.ahnert@ngfmail.com