Monthly Digest: China Food Sector Review | Dec 2023
BY Jekyl HeJan 05, 2024


  • Market Condition

  • Company Dynamics

  • Interesting & Noteworthy Products

  • Regulatory Compliance


Market Condition

1. According to the National Bureau of Statistics, the dairy production in China totaled 28.02 million tons during Jan-Nov 2023, with a year-on-year (YoY) growth of 3.3%. Whereas the output in November 2023 was 2.56, declining 1.9% YoY. 


2. Benefiting from consumers’ increasing health awareness, China’s health food industry is estimated to reach CNY 300 billion in 2023. Currently, there is a high demand for products supporting cardio-cerebro-vascular and liver health. In terms of sales channels, most consumers opt for e-commerce platforms to purchase health food products due to their wide range of product categories and brands, as well as the convenient shopping experience they offer. [1]

3. The report of the World Coffee Portal indicated that China had surpassed the United States to have the most branded coffee shops worldwide. At present, there are 50,000 coffee stores in China, representing a YoY increase of 58%. This remarkable growth is mainly resulted from the rapid expansion of Chinese domestic coffee brands like Luckin and Cotti, which have been opening numerous stores nationwide. 


4. In November 2023, China’s new consumption sector witnessed 56 investment and financial events, amounting to CNY 17.9 billion. Compared with October 2023, both the event number and amount rose significantly. Among these events, 18 took place in the food and beverage sectors, accounting for 32.14%. 

Company Dynamics

1. Danone unveiled a new infant formula as per China’s new GB standards, becoming the first product under Danone’s Nutrilon series added with GOS, FOS, OPO and lutein to enhance babies’ nutrient absorption. Although positioned as a superior infant formula within the Nutrilon series, it has a cost-effective price. Consumers can purchase it on online channels like Tmall and JD at CNY 198, and offline channels. 


2. Eastroc Beverage, a Chinese energy drink giant, rolled out a coconut juice product in December 2023, aiming to join the plant-based beverage sector. Made from fresh coconut milk, the product restores the taste of fresh coconut through a unique preservation technique and ultra-high pressure processing technology. Currently, it is available on the brand’s Tmall flagship store at CNY 49.9 per box. In recent years, the Chinese market witnessed a significant surge in consumer demands for coconut water, whose market size has grown from 513 million yuan in 2018 to 780 million yuan in 2022, and is expected to reach 1 billion yuan by 2025. ( More information about China’s coconut water market on ChemLinked.


3. Recently, Junlebao signed a pre-listing tutoring agreement, indicating its official launch of the A-share IPO process. In fact, the company announced to officially initiate its IPO project as early as in July 2022 and has striving to complete the stock exchange listing by 2025. As one of the leading dairy enterprises in China, Junlebao holds a prominent positions in the Chinese low-temperature yogurt, low-temperature milk and infant formula sectors. 


4. Cheespirit, a Chinese cheese brand, completed the pre-Series A+ funding round in December 2023, with exclusive investment from Cyanhill Capital. The brand's founder stated that the funds raised would primarily be used for new product promotion, so as to drive the brand development. Notably, Cheespirit recently rolled out China’s first room-temperature original cheese specifically designed for females. The new product contains astaxanthin, vitamin C, elastin peptide, red date, cranberry, GOS, etc. to support female health through anti-oxidation, supplementing vital energy and blood, promoting metabolism, strengthening self-care, and supplying calcium dimensions. 


5. The “Busy for You Group”, the combined company after the merger of China’s leading snack mass retail stores Busy for You and Super Ming , acquired investments of CNY 700 million and CNY 350 million from food brands Haoxiangni and Yanjin Shop, respectively. The considerable investment was resulted from the soaring development of this distinctive offline snack retail channel, where a wide variety of snack food products from diverse brands are sold at relatively lower prices. According to Euromonitor, the sales value of this retail channel in 2022 reached CNY 41.9 billion and was estimated to continue growing with a compound annual growth rate (CAGR) of 46-68% in the following three years. (More information about snack mass retail stores in China on ChemLinked.)


Interesting & Noteworthy Products

1. Yili launched a milk powder product with sleep aid function for adults in December. The new milk powder integrates traditional Chinese health-preserving ingredients like poria cocos and ziziphus jujuba spinosa kernel, and plant extracts helpful for sleep, such as theanine and walnut peptide, to maximise its sleep aid efficacy. Additionally, it is manufactured from raw milk with zero sucrose to provide consumers with daily nutrition needs.


2. Heinz rolled out a brand-new sauce product offering four distinctive tastes suitable for pairing with different foods. The classic Korean sweet and spicy flavour is recommended for enjoying with fried chicken and rice cake. The Mexican hot and smoked taste is a great match for grilled wings and seafoods. For those craving chips and crispy pork slices, the tomato and cranberry flavored sweet and sour sauce is an ideal choice. When it comes to sausage and steak, the North American Texas barbecue flavoured sauce is the preferred option. Moreover, to enhance convenience, the product is served with small individual packs for consumers to carry and enjoy. Currently, it can be purchased on major e-commerce platforms at CNY 39.9 for two boxes, each containing four flavours. 


3. Chi Forest, unveiled a kind of fruit and vegetable beverage with two flavours. carrot and orange, as well as kale and kiwi flavours. Both flavours are enriched with 11 different types of fruits and vegetables, providing an efficient source of daily dietary fiber. For instance, the 280ml kale and kiwi flavoured beverage contains dietary fiber content equivalent to approximately 400g of kale. The product is now available in the brand’s Tmall flagship store, priced at CNY 124 per box (15 bottles, 280ml per bottle). 


4. Lamianfan, a Chinese instant noodle brand, launched a zero-fried braised beef instant noodle product. In order to highlight its health characteristic, compared with other fried instant noodles, its package is in green. The brand rolled out a marketing campaign “If it doesn't taste good, it's free of charge”. During the campaign period, consumers can sample one bucket of the product. If they find the taste is unsatisfactory, they can return the remaining products and get a full refund. 


5. Snickers unveiled a dark chocolate cereal bar with low GI and low sugar. Each 30g product has an approximate GI of 40 and contains less than 2g of sugar. Besides, it contains 1.6g prebiotic per pack to promote digestion. Furthermore, in line with the brand's commitment to sustainability, the product package is made from a single polypropylene material, making it easier to recycle and regenerate. The outer packaging box is manufactured from paper ingredients certified by the Forest Stewardship Council (FSC) to reduce plastic use and support sustainable forest management. 


Regulatory Compliance

1. On December 3, 2023, the State Administration for Market Regulation (SAMR) unveiled the updated Administrative Measures for Registration of Foods for Special Medical Purpose, replacing the 2016 version. Major revisions include priority review and approval procedures, situations not approved for registration, labels, penalties, and measures to optimize the registration procedure. The new version will come into force on January 1, 2024. More details on ChemLinked.

2. On December 11, 2023, National Health Commission announced to seek public comments on 21 national food safety standards, involving food contact materials, dairy products, testing in Chemistry, Microbiology, and Toxicology, Good Manufacturing Practice for health food, Good Hygiene Practices and food additives. More information on ChemLinked. 

3. On December 19, 2023, the General Administration of Customs China published the list of non-compliant food products in November 2023. A total of 182 batches of imported food from 33 countries/regions were rejected. More details on ChemLinked.

4. China will reduce the import tariffs on dairy-based infant formula for special medical purpose and dairy-based food for special medical purpose. More details on ChemLinked.

5. On December 22, 2023, the SAMR officially released the Guidelines for the Standardization of Health Food Logo Labeling. Compared to the consultation draft unveiled in 2022, notable revisions have been made to the size and proportion of the health food logo. The use of health food logo shall strictly comply with the new Guidelines. More details on ChemLinked.

6. On December 22, 2023, China National Center for Food Safety Risk Assessment opened two novel food raw materials for public comments. They are L-alpha-Glycerylphosphorylcholine and Leuconostoc pseudomesenteroides. More details on ChemLinked.

7. Following the release of the Health Function Catalogue Allowed for Health Food Claims Non-Nutrient Supplement (2023) and its supportive documents, the SAMR has initiated the process of "certificate renewal and replacement" for health food. More details on ChemLinked.

Disclaimer: All images used in the article are from the Internet. 
Jekyl He
ChemLinked Market Research Analyst
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