Kiwi exports boom as Chinese consumers seek TCM ingredients from overseas

09-Feb-2018 - Last updated on 09-Feb-2018 at 00:45 GMT

Despite China being a major exporter of TCM ingredients, local consumers have shown a preference for TCM products from overseas. ©Getty Images

An increasing number of Chinese consumers are developing a taste for TCM ingredients and products imported from overseas, with New Zealand firms in particular enjoying an exports boom.

A long history of food and drug safety scandals in the country has led many to look elsewhere for food items, supplements, and medicine.

The rising cost of TCM ingredients and products in China is another reason the Chinese are now keener on foreign imports than before.

Despite China itself being a major exporter of TCM ingredients, local consumers have shown a preference for TCM products from countries such as New Zealand and Japan.

Deerly beloved

One country whose TCM ingredients have piqued Chinese interest is New Zealand.

In particular, the country's deer velvet exports to China have grown steadily over the last four years.

The country is the world's second largest market for deer velvet exports (after South Korea). Between end-2013 and end-2016, year-on-year growth in export value from New Zealand to China stood between US$2.1m and US$8.5m.

However, between end-2016 and end-2017, this figure shot up to nearly US$19m. The total export value at end-2017 was US$33.5m, more than double the US$14.5m at end-2013.

Rhys Griffiths, Asia market manager of Deer Industry New Zealand (DINZ), told NutraIngredients-Asia: "We've seen a significant increase in velvet exports, and prices have returned to the levels of the previous year, if not higher.

"This is a good rebound after the price dips we saw the year before."

He added that export volume from New Zealand to China had risen from 123 tonnes in 2013 to "just under 235 tonnes in 2017".

Apart from New Zealand’s good reputation when it comes to food and ingredient safety, this growth in exports can be attributed to higher GDP and greater individual wealth in China.

At the same time, a variety of innovations involving TCM have attracted consumers with their added convenience.

Griffiths said, “Instead of going to a TCM practitioner and having to get their doses formulated, or having to spend time preparing their herbal remedies at home, people can just go to a pharmacy and get what they need in a format that’s easy to use and consume.”

He also said the New Zealand deer velvet industry is focusing on “trying to find key partners in China”.

Eastern exchange

Interestingly, as Japanese herbal medicine companies aim to move away from relying on imports from China — in order to better meet the ageing population’s growing demand for TCM — Chinese interest in raw ingredients sourced in Japan has increased.

The interest from China in Japanese ingredients is spurred not only by the former’s food and drug safety scandals, but also by Japan’s reputation for producing high-quality ingredients, and the rising prices of medicinal herbs in China — even though Japanese herbs tend to cost more.

The Japan Kampo Medicines Manufacturers Association (JKMA) recently reported that while the average price of Japanese medicinal herbs had risen from US$22 per kg in 2006 to US$27 per kg in 2016, the average price of Chinese herbs had more than doubled in the same period, from US$6 to US$14.