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RISING INCOMES OPENING DOORS FOR FOREIGN PRODUCTS IN CHINA

SHARE RISING INCOMES OPENING DOORS FOR FOREIGN PRODUCTS IN CHINA

Proliferating refrigerators, counterfeit products and a street named Famous Brand Name Road are some capitalist-type touches in the new China, an Agriculture Department report says.

"Until recently, the 1.2 billion-person Chinese market has been more myth than reality," the Foreign Agricultural Service said in its publication, "Trade Highlights.""Now, the potential of the rapidly changing Chinese economy is being realized. With economic growth estimated at 13 percent in 1993, rising incomes are driving increased demand for foreign products and U.S. consumer food products in particular," it noted.

The report estimated that 1993 total U.S. agricultural sales to China exceeded $500 million. The overwhelming majority was bulk products such as wheat and cotton, but the consumer food market is blossoming as economic growth leads to income gains and soaring demand for more and better products.

"A culture of conspicuous food consumption has emerged in Shanghai," the report said, with foreign brand-name products extremely popular in China.

And this has led to a Western-type innovation - the sale of counterfeit brand-name products.

"Sunkist oranges are not available in China today, yet the power of the Sunkist brand has led to the sale of counterfeit Sunkist oranges" stamped with the brand name, the report said.

"Another example of the popularity of brand names, according to the China Economic Review, is the renaming of a Shanghai street to Famous Brand Name Road," it said.

"The arrival of fast-food restaurants such as McDonald's, Pizza Hut and Chinese fast-food chains such as Fairwoods are boosting demand for frozen french fries, chicken parts, food ingredients and condiments," the study added.

Another sign of growing prosperity and expanding markets for food imports is the spread of refrigerators, the report said. In 1985, only 7 percent of urban Chinese households had refrigerators; by 1993, the figure had grown to 53 percent.

Not every aspect of the Chinese agricultural market is following a Western lead, however.

"The most popular poultry parts are chicken wing tips, paws (foot with shank attached), and mid joint wings," the report said. "The popularity of chicken wings is attributed to Chinese consumer preference for chewing bones. . . . Chicken feet are a popular item in dim sum."

The most popular U.S. consumer food exports are poultry meat products, it said. American snack foods, including fruit and nuts, also are gaining in popularity. Pistachios are a popular snack item because their name, Kaixingguo, translates into the Happy Nut, the report said.

Other best product prospects, based on 1993 U.S. sales of direct and re-exports from Hong Kong, are ginseng, $29.3 million; confectionery, $4.3 million; frozen french fries, $1.1 million; edible beef offal, $5.9 million; fresh vegetables such as iceberg lettuce and celery, $1.6 million; seafood such as fish roe, crab,and salmon, $29.8 million; condiments and beer.