Candy in China – not only for the eyes

I have already mentioned candy in some of my posts, like the huamei candy as an example of how a traditional sweet is used in China as an ingredient for a novel food, a company like Hsu Fu Chi that is one of China’s top biscuit producers, but also makes candy. As most Chinese have a sweet tooth, it is time to dedicate an entire post to the Chinese candy market.

Top 10 candy brands of 2016

Brand Share (%)
Hsu Fu Chi 17.46
Alpenliebe 6.86
Madajie 5.22
Golden Monkey 4.73
Extra 4.35
Yake 3.77
Wrigley 3.52
Big White Rabbit 3.37
Orion 3.29
Fujiya 3.26

Hsu Fu Chi and Orion also rank among China’s top biscuit brands.

Top regions

The following table shows the regional breakdown of candy production in China during the first 5 months of 2015 and the growth compared to the same period of 2014.

Region Volume (mt)
Growth (%)
China 1,535,436.81 15.88
Fujian 346,469.46 29.13
Guangdong 341,475.82 23.63
Shandong 137,015.60 5.35
Hunan 112,946.00 22.33
Henan 93,442.60 5.86
Hubei 89,605.24 12.44
Sichuan 73,344.00 10.47
Shanghai 72,039.97 0.03
Jiangxi 45,486.00 13.82
Anhui 44,148.56 6.06
Hebei 32,991.04 -19.00
Jiangsu 29,052.23 11.63
Guizhou 23,749.54 36.03
Beijing 20,565.77 7.96
Chongqing 17,305.29 34.49
Liaoning 15,272.00 -11.77
Zhejiang 12,302.56 5.85
Qinghai 8,882.00 61.90
Yunnan 5,674.56 -23.44
Shaanxi 5,112.06 36.94
Tianjin 3,316.00 29.58
Hainan 2,679.60 -10.23
Gansu 918.20 -40.45
Inner Mongolia 907.00 71.91
Xinjiang 646.00 -5.00
Guangxi 89.71 -10.83

The first three regions alone are already good for more than half the national output. The regions not included in this table do not produce (significant volumes of) candy. Continuous growth This market has been expanding 8% – 12% for quite a number of years. According to the State Bureau of Statistics, China has produced 2,119,100 mt of candy during the first 8 months of 2014, up 12.92% compared to the same period in 2013. When we use this figure to estimate the total volume of 2014, we can expect another huge increase for this year. The growth figures in the second column of the 2013 table indicate that the market is highly volatile. Some regions show a double digit growth, while others dropped as much as 33%. One reason behind this phenomenon is the propensity to vogues of Chinese consumers. One day you can see young women snack on dried dates everywhere and a few months later they have all switched to yoghurt flavoured candy, or whatever is in vogue those days. Traditional Candy is a rather Western thing, but if you want me to identify a ‘traditional’ Chinese candy, my first choice will be dabaitu, ‘Big White Rabbit’ milk candy, produced by Guanshengyuan in Shanghai (est. 1918).

WhiteRabbit

It is a white soft nougat-like candy. Before wrapping, each candy is wrapped in thin edible rice paper. This is meant to prevent the candy from sticking at your fingers and can be eaten along with the rest of the candy. The ingredients as listed on the packaging are:

Edible glutinous rice paper (edible starch, water, glycerin monostearate), liquid maltose, sugar, whole milk powder, butter, additives (gelatin, vanillin), corn starch, syrup, cane sugar, butter, and milk.

Each candy contains 20 calories. Older Chinese still remember Guanshangyuan’s original slogan: Seven White Rabbit candies is equivalent to one cup of milk. It is therefore positioned as a nutritional product. It is still extremely popular. This product alone generated a turnover or RMB 320 mio in 2013. For decades, there was only the original vanilla flavour, but new flavours, like: chocolate, coffee, toffee, peanut, maize, coconut, lychee, strawberry, mango, red bean, yogurt, and fruit have been added. An ‘extra creamy’ variety has also been launched. The latest addition is ‘ice cream flavour’. According to the packaging, the ingredients are:

Liquid maltose, sugar, whole condensed milk, whole milk powder, cream, additives (gelatine, vanillin, food flavours), edible glutinous rice paper (edible starch, water, glycerin monostearate).

The difference with the traditional candy seems to be small, and mainly in the use of flavours.

Tradition slowly forgotten (?)

I don’t want to make northerners think that I have a special liking for Shanghai, so I would like to introduce another traditional candy, that is much older, but less well known outside China, that Big White Rabbit creamy candy: crispy shrimp candy. ShrimpCrips

These are traditionally made by rolling a chunk of hot molten sugar into a thin sheet, covering one side with sesame paste, and rolling it up into a cylinder that is finally cut into candy-sized pieces. It is a traditional treat from North China that has been adapted to industrial production in the course of the 20th Century. They are being produced up to the present day, but many older consumers find that the flavour and texture of the current shrimp candy do not match that of the tradition product. Perhaps it has something to do with ingredients, but it can also be a matter of nostalgia, the feeling that nothing tastes as it did before.

Wedding candy – a typically Chinese category

A very Chinese type of candy is wedding candy, or as the Chinese put it: ‘happy candy (xitang)’. Handing out candy is part of every Chinese wedding ceremony. Newly weds often bring some to the workplace to hand out to colleagues who have not attended the ceremony. You can use any candy, but candy makers have started identifying wedding candy as a special market segment and have increased R&D efforts to develop special candy with suitable flavours and colours, and packaging, for this special moment in a couple’s life. Insiders estimate the #Chinese market for wedding at RMB 16 bln, with still considerable growth potential.

weddingcandy

Foreign markets

Chinese candy is finding its way to foreign market. A good example is Jinli Candy Co Ltd, a candy producer established in 1984 in Huairen county of Shanxi’s Shuozhou city. In 2010, the company began to export its candies to the Netherlands and in 2011, it established a cooperation relationship with the US Disney company. In 2015, it was listed among suppliers for the US-based Wal-Mart, becoming one of the few Chinese candy producers to enter the European and American markets. Over the years, the Jinli Candy Co has sold its middle-high-end candies to over 13 countries, including the United States, the United Kingdom, Canada, Australia, Russia, Spain, and Belgium. In 2014, the company’s exports reached $1.5 million.

Jinli

China Candy in international limelight

Ever Maple Flavors and Fragrances Holdings, under control of Kelly Zong, daughter of Wahaha founder and chairman Zong QInghou, has acquire China Candy Holdings in May 2017. The mother company is based in Fujian province and manufactures and sells candies under the Holeywood brand in China, South East Asia, North America, Europe, and internationally. The company’s products include jelly drops candies, aerated candies, hard candies, and chocolate-made products. Rumours about this take over had been around for months. Ms. Zong is also chairman and executive president of Hongsheng Group, beverage producer recording turnover of RMB 5 bln per year. It looks as if she is following her father’s footsteps in building a food and beverage conglomerate, though focused on what Chinese like to refer to as leisure foods and drinks. This move also proves that the Chinese confectionery industry is currently maturing to a global level.

Eurasia Consult’s database includes 1563 producers of various types of candy.

Eurasia Consult Food knows the Chinese food industry since 1985. Follow us on Twitter.

Eurasia Consult Consulting can help you embed your business in Chinese society.

Peter Peverelli is active in and with China since 1975.

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How an Old Godmother has created China’s growing chili culture

From ‘too hot’ to chili lovers

Chili has seen a remarkable growth in China during the past couple of decades. I still remember my first year in China as a student in 1975. Sure, you could get hot dishes in some restaurants, but the average Beijing citizen would start crying ‘hot!’, if a dish would include as much as one single tiny peppercorn.

Although chilli peppers were introduced to China in the latter half of the Ming Dynasty (1368-1644), the fruit only really gained popularity during the early years of the Qing Dynasty (1644-1911). It quickly entered the cuisines of a few regions in China, in particular Sichuan and Hunan, but in many other regions spicy food was regarded as exotic.

During my later terms in China, not much change in that situation occurred, until in the course of the 1980s Sichuan restaurants started to spring up like mushrooms in the Chinese capital. And we are not talking about food with a few chillis, but Chongqing Hotpot, a kind of fondue, but then with a soup that seemingly consists purely of chili, became the favourite of the Beijingers.

Nowadays, restaurants specialising Sichuan and Hunan cuisines can be found all over China and chili in many varieties (dried, paste, oil, etc.) are top items in supermarkets. There are even shops specialising in all types of chilli. Some people have started to speak about a Chili culture (lajiao wenhua). In Chongqing you can even visit the Youjun Chili Museum.

ChilliCulture ChliMuseum

Top chili nation

During a recently held forum on chili processing, insiders have stated that China has developed into the world’s largest chili processing region. The total value of the world market for chili is estimated at USD 30 billion, and China is good for one third of this. Sichuan province alone has an annual raw chili output of approximately 1 million mt, with a value of RMB 1 billion. In some Chinese statistics, spicy sauces are referred to as ‘Sichuan sauces’. The province’s chili processing industry has an annual turnover of RMB 2 billion. R&D in new applications for chili and chili derivatives is also growing, developing products for the food, pharmaceutical, cosmetic industries.

The following graph shows the development of the Chinese market for ‘Sichuan sauces’ during the past few years and estimates for 2015 and 2016; unit: RMB 100 mln.

ScSauceVols

Various shapes

Chili is not only consumed as such, fresh or dried. The fruit is processed in numerous products that themselves are used as ingredients in home cooking or industrial foods. The Food Ingredients China (FIC) 2016 trade fair will included 43 exhibitors supplying various chili-derived ingredients, including: capsaicin, capsicum oleoresin, chili powder, and chili food colour.

A special type of hot sensation is caused by the Sichuan pepper (huajiao) that produces a numbing hot sensation in the mouth, caused by the hydroxy-alpha-sanshool it contains. Sichuan pepper is often combined with chili and other peppers in savoury pastes, like the Pixian Douban reported in an earlier post in this blog.

Chili paste

The by far most common form in which chili is consumed is the chili paste. It is a mixture of ground chili and a variety of other ingredients, and can be easily used to spice up dishes or as a dip for foods that could do with some extra flavour like boiled dumplings.

Here is a list of the top 10 Chinese chili pastes.

Laoganma (Old Godmother) Laoganma

Laoganma is THE success story of the Chinese seasoning industry. Established in 1997 in Guiyang (Guizhou; another leading chili region of China) by a lady who used to sell spicy noodles at a street corner (starting in 1989), it has rapidly grown into China’s top range of chili products. The company also exports worldwide. Watch this video reporting on Laoganma and its founder.

The latest development regarding Laoganma is that a group of young Chinese cocktail makers have started experimenting with cocktails made with Chinese spirits (baijiu) and various hot seasonings including Laoganma.

Huaqiao Huaqiao

This brand has a history of more than 300 years, deeply rooted in its home town Guilin (Guangxi).

Lameizi (Hot Sister) Lameizi

This is once more a new brand, established in 1998 in a traditional chili region: Hunan. It is part of a conglomerate that produces a wide range of foods, besides seasoning products.

Lee Kum Kee LeeKumKee

I have reported on Lee Kum Kee before, in my post on yuxiang flavours. The brand dates from 1888 and has its home in Nanshui (Guangdong). It is the best known seasoning brand in East and Southeast Asia.

Meile Meile

This is the first Sichuan brand in this list. The brand covers a wide range of seasoning products, but its Fragrant Spicy Sauce has brought the brand fame.

Huhu Huhu

This brand has been established in Qingdao (Shandong), one of China’s blander cuisines, in 1992. It specialises in fermented savoury pastes.

Modocom Maodegong

This is an English rendering of the Chinese brand name Maodegong. It has been established by a farmer from Leizhou (Guangdong).

Huangdenglong (Yellow Lantern) Huangdenglong

This brand was launched in Hainan in 1994. Its name has been inspired by a latern-shaped chili that only grows in Hainan.

Fansaoguang (All Food Devoured) Fansaoguang

This is a brand of Gaofuji Food (Sichuan). The name refers to the Chinese perception that chili paste increases the appetite. There will be no leftover of food spiced up with this product.

Haitian Haitian

Haitian is one of China’s top seasoning brands. It is currently China’s top producer of soy sauce, but its other products are popular. It is another brand with more that 300 years of history, based in Foshan (Guangdong).

Eurasia Consult Food knows the Chinese food industry since 1985. Follow us on Twitter.

Eurasia Consult Consulting can help you embed your business in Chinese society.

Peter Peverelli is active in and with China since 1975.

Chinese acquire a taste for olive oil

Healthy image

International olive oil producers are looking at China to increase their turnover, because the nation appears to have developed a taste for the healthy oil.

An telling story from the media is that of Cui Ronghua, a peanut exporter from the eastern port of Qingdao. His children were already drinking imported baby formula, so he decided that the family started cooking with imported olive oil as well.

Relying on imports

Because China’s climate is not suitable for mass olive production and more Chinese are realizing olive oil is generally healthier than most cooking oils, imports have surged in recent years, especially in top-tier cities such as Shanghai and Shenzhen, where 80% of olive oil shipped from Spain, Italy, Australia and Turkey is consumed.

China has imported 6924 mt of olive in the first three months of 2015, up 2.7% compared to the same period of 2014.

Jean-Louis Barjol, executive director of the Madrid-based International Olive Council, the world’s only international intergovernmental organization in the field of olive oil and table olives, said because China’s huge middle class is very conscious about food quality and health issues, the Mediterranean diet, which uses plenty of olive oil, is a practical way to maintain health.

“The numerous television advertisements released recently by Chinese olive oil importers and the campaigns led by export countries’ trade-promotion bodies to explain the uses of olive oil have resulted in a significant increase in sales, as well as the opening of hypermarkets in the nation’s main cities selling imported foods,” Barjol said.

“We found people in China are more inclined to buy extra-virgin olive oil, which does not require refining and is 20% more costly than refined olive oil,” said Amparo Chozaz, assistant managing director of the Spanish Olive Oil Exporters Association in Madrid.

Eager to gain more market share from their already established rivals from Italy and Greece in the China market, Spanish olive oil companies chose to join together in promoting their products under the name Spanish olive oil in the China market.

Chozaz said they spent 4.5 million euros ($6.19 million) on popular cooking programs featuring Spanish olive oil on Chinese TV stations, commercial websites and magazines. They also held national food events to boost their olive oil exports to China in 2013.

Despite the fact that olive oil accounts for only 1% of China’s total edible oil consumption, the country’s olive oil imports remained strong and hit 43,400 mt in 2013, an increase of 5.8% from the previous year.

China’s recent embrace of olive oil was a welcome change for Mediterranean nations, where olive oil prices plummeted in 2012 because of the weak EU economy and a bumper Spanish crop. China’s growing imports have helped support global olive oil prices.

The following table shows China’s imports of olive oil in the past few years.

Year Imports(mt)
2009 14,700
2010 20,200
2011 32,800
2012 41,000
2013 43,400

Outbound investment

The growing trade figure has also pushed Chinese companies to seek takeover targets overseas that can help meet demand for olive oil back home.

In 2012, six investors from China’s textile, garment and agribusiness industries secured a $15.47 million deal for the purchase of the olive oil company Kailis Organic Olive Groves, which owned 3,813 hectares of plantations in Western Australia.

Another major deal was sealed by Jiangxi Qinglong Group, which invested $32 million in Australia to purchase 5,000 hectares of olive plantations last year, as well as half of the shares in Tatiara Olive Processing Pty, a major olive oil processing company in Keith, South Australia.

The Chinese company intends to invest another $12 million to purchase new equipment and build needed infrastructure to ensure future production. This project is expected to produce 25,716 metric tons of extra virgin olive oil after 15 years and achieve sales revenue of $157 million by then. Both Australia and China will be its main target markets.

Shanghai-based Bright Food Group has bought a majority stake in Italian olive oil producer Salov Group, the company announced on Oct.7, 2014.

Shanghai Yimin No 1 Food Factory, a subsidiary of Bright Food, signed the deal with the Fontana family in Milan on Oct 1, according to a statement published on the buyer’s website.

Bright Food is a big name in dairy industry as well as categories of rice, pork and vegetable in China. It now has four listed subsidiaries.

In the online statement, Bright Food promised to stick to Salov’s values and missions and help promote its development in China.

Salov operates mainly in olive oil and other vegetable cooking oil. It distributes products under the Sagra brand name in Italy and Filippo Berio in overseas markets.

The oil maker currently markets its products in over 60 countries including China and maintains a leading position in Britain and the United States.

Domestic production

In spite of the adverse geographic conditions, a number of Chinese companies have invested in growing olives to take a part of this growing market with domestic products.

Tianyuan in Sichuan started planting olives in 1974 as part of State sponsored project. The company produces cooking oil and olive oil based cosmetics. Tianyuan cooperates with Chengdu University for its R&D.

Tianyuan

Garden City (the Chinese name is also pronounced Tianyuan, but with different characters) in Gansu is another domestic producer, established in 1998. It produces olive oil, cosmetics and olive leaf extracts.

OliveStory

25 mills in China managed to produce 5,000 mt of olive oil in 2016 according to the International Olive Council citing official sources, a 75% increase over the previous season. Olive oil production employed approximately 15,000 people, mostly in the Gansu, Shaanxi and Sichuan provinces. The amount of land devoted to olive production was reported to amount to 86,000 hectares. Domestic production represents about 12% of the country’s current needs.

Exhibition

The 16th China International High End Edible Oil & Olive Oil Beijing Expo 2017 will be held in the China International Exhibition Centre, Beijing, April 17 – 19; the Shanghai International Exhibition Centre, August 30 – September 1; the Chengdu New International Exhibition Centre, October 12 -14.

Eurasia Consult Food knows the Chinese food industry since 1985. Follow us on Twitter.

Eurasia Consult Consulting can help you embed your business in Chinese society.

Peter Peverelli is active in and with China since 1975.

 

Harbin – where the West meets the East

It is about time to highlight another region in this blog. After Pu’er in China’s southernmost province Yunnan, I am taking you to the opposite in this blog, to Harbin, the capital of Heilongjiang, which shares a large border with Russia’s Siberia.

What Harbin has in common with Pu’er is that it is not a purely ethnic Chinese city. The name Harbin already betrays that it is not Chinese. A number of stories about the name’s original meaning; one is that it means ‘place to hang fishing nets to dry’ in Manchu, the language of the people with the same name. The Manchus were once a powerful nation, and the emperors of the last imperial dynasty of China, the Qing Dynasty (1622-1912) were Manchus, not Chinese.

Moscow of the orient

After the Russian Revolution, a large number of Russians fled to Manchuria, with Harbin as their unofficial capital. It gave Harbin its nickname ‘Moscow of the East’. A number of Russian buildings still survive, like the orthodox cathedral. Moreover, some Russian words entered the local dialect. The most famous one is lieba, from the Russian chljeb ‘bread’. It refers to a large round bread baked with beer yeast. This type of bread has become the symbol of Harbin cuisine.

Lieba

Watch this video for more information about the Russian influence on Harbin cuisine.

When the Japanese invaded Manchuria, they more or less let the Russians live there in peace, while the Russians accepted Japanese rule; they had no choice. In fact, for a short period, Russians, Chinese, Japanese, Koreans and several national minorities (in particular Manchus and Mongolians) lived in a peaceful coexistence in Harbin. This ethnic diversity has created an equally diverse local cuisine. Besides the afore mentioned bread, dairy products also became part of the diet of Harbin people, long before Chinese elsewhere started to appreciate the white gold. The potato, the typical staple of Western cuisine, has also grown roots in this city.

The consumption of coffee is also increasing rapidly in Harbin. Insiders report that there were more than 400 coffee shops in the city at the end of 2015, consuming about 60 mt of coffee beans per year.

Harbin Beer (better known as Hapi in China) is one of the top beer brands in China, though currently owned by Anheuser-Busch. The Harbin municipal government and Harbin Cultural Tourism Group are co-hosting the 2016 China-Harbin International Beer Festival, which will run from June 30th to July 17th at the Harbin Frozen World in Songbei district. There will be 11 beer tents, 16 food exhibition areas and four cultural exhibition areas. The total area of the beer festival is 600 thousand square meters

Agricultural region

Heilongjiang is one of the prime agricultural regions of China. The chernozem soil in Harbin, called “black earth” (Heilongjiang literally means: ‘Black Dragon River’) is one of the most nutrient rich in all of China, making it valuable for cultivating food crops. According to the municipal statistics of 2013, Harbin alone was good for more than 2% of the national grain output, 1% of the meat and 4% of dairy products.

BlackEarth

Heilongjiang is one of the major grain-producing areas in China, ensuring food security for the country. The grain output of the province reached 67.6 billion kgs in 2014, leading the country’s provinces since 2011 and accounting for one-tenth of the national total.

In recent years, the province has pushed forward agricultural modernization, promoted the green food industry and established marketing platforms for Internet Plus agriculture.

A sophisticated Internet Plus marketing platform has been established for rice products in the province. Heilongjiang rice is of high quality but used to sell poorly.

The following table shows the development of the total turnover of the Harbin food industry during the past few years.

Year Turnover(RMB bln)
2008 40
2010 50
2011 70
2012 90
2013 95

The processing of agricultural produce was still the most prominent activity in the Harbin food industry in 2013, as is shown in the following breakdown.

Activity ratio (%)
Processing of primary produce 68.0
Food production 15.3
Beverage production 8.6
Tobacco products 8.1

(tobacco is part of the food industry in Chinese statistics)

Top companies

Wondersun Dairy Industry Co., Ltd.

Wondersun is part of Heilongjiang’s biggest Agricultural State Owned Enterprise called Beidahuang Group. The company is ranked as fifth among China’s dairy enterprises and holds 7 subsidiary companies and 41 factories. Wondersun’s liquid milk ranks among the top ten in the country and was assessed as one of China’s most valuable brands in 2003. The company has formed a strong sales network that covers the whole country. Wang Jinghai, president of Wondersun, believes Heilongjiang is ideal for raising cows and producing dairy. The company is expected to sell products worth RMB 50 mln in 2015 through e-commerce channels and has set a sales goal of RMB 300 mln next year.

Heilongjiang Dairy Group Co., Ltd.

Heilongjiang Dairy Group was established in 2004, and the companies registered capital is 213 million RMB. It is one of the key national enterprises in the agricultural industry in China. The main shareholder is the Haerbin HIT group with 10 other small shareholders. The company has four brands, and the brand Longdan and Jinxing have a high reputation in the entire country.

Beidahuang Group

Beidahuang has 16 agriculture branch companies and Haolianghe Fertilizer Company. It is also the parent of Beidahuang Grains Co., Ltd., and Harbin Longken Malt Co., Ltd.. The company owns 624,000 hectares of land. The main crops are rice, soybeans, corns, wheat and brewing barley, supplemented with crops cash crops like red beans, kidney beans, pumpkin seeds, lucerne, medicinal herbs and flax. Haolianghe Fertilizer Co., Ltd. has an annual production of 200,000 mt of carbamide and other fertilizer products. Beidahuang Grains Co., Ltd. has an annual production of 1.4 million tons of refined rice and 100,000 mt of other byproducts. The yearly malt output of Harbin Longken Malt Co., Ltd. is 200,000 mt.

Harbin as gateway to China

Harbin has been on the radar of foreign investors from the beginning of China’s economic reforms.

Nestlé was one of the first Western multinationals to invest in China, with a joint venture for the production of infant formulae in Acheng, a suburb of Harbin in the 1980’s. This subsidiary of Nestlé has withstood all turbulent developments of China since then.

Nestle

Another multinational, McCain, started a potato processing venture in Harbin in 2005. The venture included a 7.5 ton/hour plant and two associated potato storage facilities. McCain Foods has been preparing for its expansion in China for a long time before it finally chose Harbin. The company stated that Heilongjiang Province produces the largest output of potatoes yearly. With its unique geological position adjacent to Russia, Harbin may prove an ideal investment location for companies who want to tap the Far East market, he said. The company decided to double its capacity in 2012.

Other foreign investors in Harbin include a yeast plant of Burns Philp. That makes sense, as bread has been part of the local cuisine for a long time. Even thought lieba is a kind of sourdough, yeast bread was easily adopted as a quicker alternative for the traditional Russian style bread. I myself have organized a number of baking seminars, when I was promoting yeast and bread improvers of Gist-brocades (now part of DSM) in China.

China has reacted quickly to cash in on the opportunities created by the trade war between Russia and the EU/US. This will be an extra large boost to the importance of Harbin as China’s northernmost foreign trade hub for food and agricultural products. Harbin’s ‘Russian’ background will certainly facilitate this development. The China Harbin International Economic and Trade Fair was renamed into Sino-Russian Expo in 2014.

The World Dairy Expo & Summit will be organised again in Harbin, april 21 – 24, 2016. The 2015 edition attracted 15,728 visitors from all over the world.

HarbinExpo

Organic and green food

Heilongjiang is China’s primary region for organic agriculture and Harbin is again a centre for this industry.

The municipal government has build a large modern food storage and distribution system for organic produce. The system includes a food logistics centre with an annual handling capacity of more than 1 mln mt, three distribution centres with a combined annual handling capacity of 1.5 mln mt and 11 grain depots each with a storage capacity of 200 000 mt.

HlGreenFood

McDonald’s sources the rice it uses on the mainland from Harbin. The city grows some of China’s top-quality rice. It has more than 600,000 hectares of paddy field producing 3.25 mln mt of rice a year as well as some 200,000 hectares of soybeans, none of it genetically engineered. It is not necessarily organic rice, but at least is produced according to China’s ‘green’ specifications.

Harbin also has annual corn output of more than 10 mln mt. The hybrid breed contains three times more protein than common breeds.

In addition to farming, the city government also invests in livestock breeding and processing. It has nearly 500,000 cows, 3 mln beef cattle and 11 mln pigs, and produces 880,000 mt of meat, 365,000 mt of eggs and 1.5 mln mt of milk a year.

The first flagship store for green food from Heilongjiang opened in Hong Kong in February 2014 offering more than 200 products. Of the 64 suppliers, 27 were based in Harbin.

Agreeable culture

Harbin is an interesting alternative to for international investors in the Chinese food and beverage industry. On top of the advantages introduced above, the people of China’s Northeast are known as easygoing and honest. The good people of Harbin are outstanding hosts, entertaining their guests with supersize dishes of fish and meat, to be washed down with lots of baijiu, traditional Chinese spirits.

HbDish

It may take a little longer to negotiate a deal. They take their time to get to know you and do not feel the urge to put on a business-like act when dealing with foreigners, as you often see in other parts of China. However, once the believe they have figured you out and the impression is positive, you are in.

Mulan – a food production centre in ‘greater Harbin’

The county of Mulan, in Harbin’s northeast, is an important site on the Silk Road Economic Belt. Its connection with Harbin has been strengthened by the completion of the Mulan-Songhuajiang Bridge.

Mulan has a population of 280,000 and covers an area of 3600 square meters. It administers six towns and eighty-six villages. There are thirty reservoirs along the Songhua River in the county and the forest coverage rate is nearly 50%. Mulan has been awarded various titles, such as “National Ecological Agricultural County”, “National Green Rice Production Base” and “National Rural Tourism Demonstration County”.

Mulan is also known for its, rice, coffee and beer. Located in the black soil area of northeast China, it enjoys distinct seasons, adequate sunlight and moderate rainfall, which contributes to the excellent quality of its crops. Hundreds of kinds of precious herbs grow in the 670,000 hectare forest and the abundant grassland feeds flocks and herds. With the improvement of agricultural infrastructure, Mulan has seen remarkable progress, especially in rice and red meat processing.

With the support of related policies and modern agriculture reform in Heilongjiang, the county has seized all opportunities to construct a grain production base, developing grain processing efficiency and funding a green food industry. It built an 8-square-meter agricultural production park to bring together various agriculture projects for cooperation.

In August, 2014, the Chinese Academy of Agricultural Sciences (CAAS) Grain Processing Technology Institute (Harbin) settled in the industrial park, the first national organization instituted by CAAS in Heilongjiang. It focuses on grain processing, product innovation and inspection services. This move inaugurates a new cooperation method between national research groups and local food industries.

In future, Mulan plans to expand the market to Russia, North Korea and Japan with the help of the Heilongjiang Silk Road Belt and, in three to five years, become the leading food research center of Northeast Asia. That development would improve Heilongjiang’s influence in the area. The government intends to pay more attention to ecological protection and sustainable development under emerging circumstances to create a better Mulan.

Eurasia Consult Food knows the Chinese food industry since 1985. Follow us on Twitter.

Eurasia Consult Consulting can help you embed your business in Chinese society.

Peter Peverelli is active in and with China since 1975.