Contents

• Market Condition

• Company Dynamics

• Regulatory Compliance

Market Condition

1. A media investigation uncovered a serious issue involving the mixed use of tanker trucks for transporting both edible oils and chemical oils. Some trucks didn't even clean their tanks between different transport. This negligent behavior has led to the contamination of edible oils with residual chemicals, igniting public outrage.

Recommended reading: China Media Revealed Contamination of Edible Oils with Residual Chemical Oils in Tanker Truck Transport

2. In the first half of 2024, China imported 1.31 million tons of dairy products, a year-on-year (YoY) decrease of 15.6%. The import value totaled USD 5.44 billion, down 22.4% YoY. Imports of infant formula dropped by 33.8% YoY to 93,300 tons, with a value decrease of 29.5% YoY to USD 1.81 billion. Bulk milk powder imports fell by 20.7% YoY to 382,700 tons, with an import value down 27.6% YoY to USD 1.35 billion.

3. According to Nielsen IQ, in the first half of 2024, fast-moving consumer goods (FMCG) saw a 1.9% YoY growth across all channels, driven largely by online sales. Beverage sales grew by 8.4% YoY online and 6.7% YoY offline, leading to an overall growth of 6.9%. However, in the dairy category, declining offline sales offset the growth seen online.

4. Birch sap products experienced explosive growth on Douyin between March and June 2024, with sales exceeding RMB 96 million, an increase of 834.8% YoY. This surge is attributed to the health benefits of birch sap, the increased market participation, and growing category recognition.

Company Dynamics

1. Le Chocolat Maxime Frederic at Louis Vuitton—the world’s third and China’s first Louis Vuitton chocolate shop—has opened in Shanghai. The store offers over 20 chocolate products inspired by LV design elements, with prices ranging from 240 to 3,200 RMB. Previously, in November 2022, LV opened its first restaurant, THE HALL, in Chengdu. Through cross-industry ventures, the fashion giant aims to extend its brand philosophy to a broader audience and foster brand loyalty through unique consumer experiences.

2. Gerber, Nestlé’s infant nutrition brand, has launched its first formula rice cereal series in China, featuring two new products: A2 formula rice cereal and PHW partially hydrolyzed whey protein formula rice cereal. Currently, Gerber operates factories in Harbin and Qingdao, with localized production capabilities for its major product categories, including rice cereals, puffs, and fruit purees.

3. Carlsberg's globally best-selling French beer brand, Kronenbourg 1664, has begun production in Yibin—one of China’s four major brewing cities—through Chongqing Brewery Yibin Co., Ltd. Previously, Kronenbourg 1664 products sold in Yibin and nearby regions were sourced from other locations. The Yibin facility will now produce Kronenbourg 1664 Rose in 330ml bottles and 500ml cans, primarily to meet local demand.

4. German supermarket chain ALDI in Shanghai has introduced a strong aroma Baijiu with 52% alcohol content, priced at just 9.9 RMB. This product has quickly become a social media sensation and one of ALDI's top sellers. ALDI's strong purchasing power, bargaining leverage, and direct manufacturer partnerships enable competitive pricing. Nowadays, as membership-based, discount, and specialty supermarkets gain popularity among Chinese younger consumers, developing private-label brands is becoming a key strategy for these innovative retailers to drive revenue growth.  

5. Nongfu Spring accused the Hong Kong Consumer Council of using incorrect standards in testing its products and providing misleading information. The enterprise clarified that the tested product is natural drinking water, not mineral water, and complies with the Chinese standard GB 19298-2014 National Food Safety Standard Packaged Drinking Water. The bromate level of its product is well below both Chinese and global safety standards. The Hong Kong Consumer Council subsequently issued a clarification.

6. Yili's European Innovation Center has entered a strategic partnership with UK biotechnology enterprise Xampla to test and validate Xampla’s microscopic natural polymer capsules for fortifying vitamins and nutrients in dairy beverages. As reported, this technology enables these sensitive ingredients to withstand processes like ultra-high temperature treatment, which would otherwise degrade them.

7. Hongdong Jiuye has launched a canned lemon sparkling wine that features a fresh lemon slice floating to the surface when the can is opened. This sparkling wine, in addition to lemon slices (≥5g per can) and lemon concentrate, also includes NFC lime juice to enhance the flavor. This innovation follows Japanese Asahi Group’s launch of its ready-to-drink cocktail with a real lemon slice named "未来のレモンサワー" (Future Lemon Sour), which garnered significant attention on Chinese social media.

8. Haitian Food has introduced a soy sauce specially formulated for fruits. This low-salt, high-umami sauce pairs well with avocados, lychees, mangoes, pineapples, and other fruits. The product features a spray cap that dispenses 0.7ml per spray, enhancing the fruit's flavor with its umami richness. Inspired by traditional eating habits in Guangdong, Guangxi, and Fujian, the launch has sparked significant buzz on social media.

Regulatory Compliance

1. On July 29, 2024, China National Health Commission (NHC) issued the finalized version of the national food safety standard legislation plan for 2024. The plan includes 35 food standards. Compared to the draft version, two standards for food additives—gellan gum and nickel—have been newly added. Additionally, one standard from the draft plan, concerning the determination of theanine in tea leaves in food, has been removed in the final version. The legislative bodies will now proceed with the legislation work for the listed food standards. More information on ChemLinked.

2. On July 30, 2024, General Administration of Customs of China (GACC) published the list of non-compliant food products in June 2024. A total of 468 batches of imported food from 44 countries/regions were rejected. More information on ChemLinked.

 Disclaimer: All images used in the article are from the Internet.