Drive to lift NZ beef profile in China

01-09-2008 | Not Specified

China-1.3 billion people growing at almost 10 million every year. If just a small proportion of those chose to buy New Zealand beef and lamb, the Kiwi economy would be on to a winner.

Sui-Len Shen is heading the drive by Meat & Wool NZ to boost awareness of Kiwi products in China, Hong Kong and Taiwan. She outlined the direction at Rangitikei Monitor Farm Programme recently.

Already Taiwan (population 23 million people) is NZ's fourth largest beef market and the plan is to leverage this awareness into the potentially lucrative China market.

Many NZ companies have foundered in China, struggling to maintain momentum in the foreign business environment. The argument for trying, however, is compelling.

China is the third largest economy in the world, and expected to be number one by 2030. Their gross domestic product (GDP) has been showing double digit growth for the past five years, and though forecast to slow it will still in all likelihood exceed 5% until 2012.

Sui-Len said that NZ exports just 99t of beef into China, mostly as frozen product as China lacks the infrastructure to deal with chilled meat.

Chinese chefs also have little knowledge around how to deal with grass-fed beef, being more used to grain-fed product. Growing this awareness will be a key strategy for Meat & Wool in China.

What needs to be acknowledged-as some businesses have found out the hard way-is that doing business in China is not like doing business in other markets. Relationships are the foundations for success.

"In Chinese society guan xi-which means relationship-that's how you get your business done.

"In the past everyone says think globally and then do locally, but actually what we've seen is you have to think locally-put yourself in the Chinese market-and then act locally, not think globally."

The potential payoffs are tantalising-China's middleclass already number 100m, the growth in this class of consumer is rapid and they are looking for non-traditional Chinese food.

"This is the category of consumer that has disposable income to spend on imported goods, and they are more health conscious, more brand aware-and they would like to try something new."

Meat & Wool's programme will focus on Beijing and several other major cities in southern China. Given the population of Beijing on its own is around 14m, that's still a lot of mouths to feed.

And of course, NZ is the first OECD country to sign a free trade agreement with China, which should improve access for products.

As mentioned, NZ already has a strong presence in Taiwan. In 2006-07 Taiwan imported 73,000t of beef, with NZ accounting for around 35% of that.

Meat & Wool hopes to translate some of this awareness into neighbouring China, where 1.5m Taiwanese work.

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