2020 China’s Fresh Supply Chain Market Report

Source:iResearchNovember 16,20203:56 PM Overview

Cold chain logistics is midstream infrastructure of the fresh supply chain. its market size reached 326.4 billion yuan in 2019. Factors such as changes in business flow and consumption upgrade will continuously drive industry development from both supply and demand ends. Cold chain logistics became the core of the fresh food industry during the COVID-19 pandemic.

Overview of China’s Fresh Supply Chain Industry

China's fresh supply chain is long, has many links and huge losses

As the original source of the supply chain, agriculture provides fresh products such as meat and poultry, vegetables, fruits, and seafood. These products are fresh and perishable, difficult to store and transport, have strong production seasonality, and low consumption elasticity, etc. With the gradual maturity of the fresh supply chain, the seasonal and geographical restrictions on the transportation of fresh products have been overcome. During the COVID-19 pandemic, because of the explosive development of fresh food e-commerce, the fresh supply chain attracts a lot of attention. Fresh supply chain capability  has become a decisive factor for the development of new retail of fresh products. The fresh supply chain industry is no longer behind the scenes and its leading enterprises in the industry will enjoy historical development opportunities.

Over 300 Million Tons of Fresh Products Are Consumed in China Every Year

The consumption of dried and fresh fruits grows the fastest, and the consumption structure is clearly upgraded

According to China Statistical Yearbook data, the total amount of fresh food consumed in China increased from 310 million tons in 2014 to 330 million tons in 2018, with a compound annual growth rate of 1.6%. Fresh vegetables accounted for the largest proportion, reaching 41.6% in 2018. The proportion of fresh melons and fruits has increased the most, from 21.1% in 2014 to 23.7% in 2018; The proportion of meat, poultry and eggs increased slightly to  21.8%. The proportions of milk and aquatic products declined slightly to 6.9% and 6.0%, respectively. The transaction size of China's main fresh food categories increased from 2.1 trillion yuan in 2014 to 2.6 trillion yuan in 2018, with a compound annual growth rate of 5.5%. Among them, the growth rate of the transaction volume of dried and fresh fruits is the highest, which is in line with the consumption of fresh food by residents, showing the residents' food consumption changing from the necessary food for daily life to higher quality and diversified consumption structure.

Cold Chain Logistics is Infrastructure of Fresh Supply Chain  

Cold chain logistics mainly serve the midstream and downstream of the fresh supply chain

Cold chain logistics refers to a logistics transportation method that keeps the goods at a certain temperature during the processing, storage, transportation, distribution, retail and other links to maintain the freshness of food or the efficiency of other products (medicine, etc.) and reduce transportation losses. It consists of pre-cooling treatment, cold chain processing, cold chain storage, cold chain transportation and distribution, and cold chain sales, involving cold storage, refrigerated trucks, insulation boxes, refrigerated display cabinets and other facilities. The cold chain logistics industry requires continuous investment from large-scale enterprises to coordinate order processing, transportation, distribution, carrier management, capacity management, reorder management, management of receivables and payables, and returned goods management through a complete transportation management information system to strengthen the overall linkage effect of enterprises to reduce costs, thereby forming a reasonable and efficient cold storage chain.

Contents

China has many kinds of fresh food, mainly including fruits and vegetables, meat, seafood, etc. They are fresh and perishable, difficult to store and transport, have strong production seasonality, and low consumption elasticity. In the traditional distribution supply chain model, there are multiple distribution links between producers and consumers, which restricts the circulation speed of fresh products and causes huge loss.Farmers' markets are still the main fresh food retail channel in China. with policies on changing farmers' markets into supermarkets and the increasing channel penetration rate of fresh food e-commerce, the proportion of farmers' markets will keep falling and the rise of new channels will speed up, putting forward new requirements for midstream distribution and upstream production.


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