Slight growth a possibility: China’s health foods body optimistic despite COVID-19 disruptions

As the country has only recently allowed companies to resume operations, the lack of raw materials may lead to a temporary insufficient supply of nutrition health foods, in turn affecting exports in the short term.

However, the trade body is optimistic of growth in the second half of this year as the pandemic gets under control and the global supply chain resumes normality, it said in a recent report which detailed the imports and exports of health foods in China for last year. 

Speaking to NutraIngredients-Asia, ​director of the CCCMPHIE Zhang Zhong Peng said that the forecast for the full year health foods imports and exports, will be dependent on the global control of the pandemic. If the pandemic could be effectively controlled in the second half of the year, there is a likelihood that the scale of the full year imports and exports will remain the same as last year. 

"Right now, because the pandemic has broke out in Europe and the US, the factories in Europe and the US have stopped manufacturing and that there is a lack of factories which are operating. This has affected the usual product supply, and will also affect the import and export of raw materials and finished products."​

In China, he said that provinces such as Zhejiang, Jiangsu, and Guangdong were seeing production get back up to speed.

In terms of sales orders, he said that China, being an important manufacturer and supplier, would still be able to retain existing businesses.

Last year, China’s import and export of health foods and ingredients reached a value of US$5.28bn. Exports were up 12.7% to US$1.88bn and imports grew by 12.8% to US$3.4bn, said a report recently published by the trade body.

The country is home to 2,317 health foods manufacturers, the largest in the world.

While exisiting businesses remain secure, the potential to secure new businesses might be affected since a handful of trade shows have been cancelled or postponed.

Zhang said that a way to overcome the problem was through online interaction with prospective business partners. 

“This would help speed up the digital transformation process, especially for the traditional businesses, in the selling of finished products,”​ he said. 

National health ed​

In addition, citing the greater demand for immune- boosting products, the trade body believes that the outbreak has presented huge growth potential for the industry, since people are becoming more health conscious.

“The novel coronavirus outbreak is an unprecedented health education for the whole nation. The public are placing more emphasis on health and disease prevention. ​

“For example, health foods that boost the immune system and virus prevention are topics of concern to the public, a number of nutrition health foods for boosting the immunity were sold out in all sorts of channels…The public’s demand for health products has been reignited,” ​the report said.

We previously reported that the sales of vitamin C​ grew by five times and that other immune boosting products such as lactoferrin and selenium-enriched yeast​ has also sold well.

Tough on exporting companies ​

Companies which rely on exports would be the toughest hit by the pandemic.  

This is because they not only faced challenges from the halt in production due to the lockdown, they also faced problems difficulties exporting their products and cash-flow issues. 

“Companies doing exports not only faced problems that other domestic companies were experiencing, they also faced difficulties in accepting the orders and performing the contracted tasks. ​

“They also needed to grapple with international logistics issues, trade barriers and many other external factors. The overlapping of (the internal and external) problems, has complicated the export circumstances,” ​said the report.