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China's Cheese Needs Here to Stay

07 January 2015

CHINA - Market research from within China shows there will be no long term let-up in the country's growing need for cheese, despite backing away from the dairy market as a whole in 2014.

China's Cheese Imports Leap 47 per cent in 2014 year-on-year for the first ten months of 2014. 

This equated to 56,028 tonnes of cheese between January and October, outstripping 2013's shipments of 47,316 tonnes, according to Chinese market researchers at business intelligence company CCM

Analysts state that China’s appetite for cheese is "growing rapidly", with the astonishing growth likely to continue as Chinese consumers become increasingly affluent and cosmopolitan. – China’s most popular Internet search engine – has reported a 59.8 per cent increase in searches for the word ‘cheese’ in the last three years, and dishes such as pizza, baked sweet potato with cheese and baked broccoli with cheese are becoming ever more popular.

Main beneficiaries of China’s newly-acquired taste for cheese so far have been New Zealand, Australia and the US, with Europe’s cheese makers trailing far behind.

New Zealand remains China’s preferred source of cheese – imports from New Zealand during January-October 2014 totalled 24,013 tonnes, a 44 per cent increase over the same period in 2013.

However, Australia is catching up fast – its total cheese exports to China rose 78 per cent year-on-year to 15,189 tonnes – and its exports are likely to be boosted further in 2015 thanks to the newly-signed China-Australia Free Trade Agreement.

Imports from the US also increased, rising 27 per cent year-on-year to 10,084 tonnes, but the US has now fallen decisively behind its Australasian rivals. New Zealand now exports more than twice as much cheese to China as the US, and the gap between Australia and the US has widened from 593 tonnes in 2013 to 5,105 tonnes in 2014.

China is steadily developing a taste for European cheese – imports from France, Italy, Denmark, Germany, and the Netherlands all rose by 25 per cent or more year-on-year – but in absolute terms this is a drop in the ocean. The total volume of imports from the top five European nations added up to just 4,696 tonnes, less than one fifth of the amount imported from New Zealand.

Europe’s relatively poor performance could be due to the fact that much of the demand in China is currently for foodservice and processed cheese, whereas many European cheese makers focus on higher-value products for retail.

China is currently importing cheese from the US, New Zealand and Australia at an average of 4.71 USD/kg, 5.10 USD/kg and 4.69 USD/kg respectively, as opposed to 8.14 USD/kg from France, 8.27 USD/kg from Italy, and 8.51 USD/kg from Denmark, which suggests that European suppliers are currently focusing on retail products.

In addition, US and Australasian suppliers hold strategic advantages over their European competitors, including New Zealand’s (and from 2015, Australia’s) superior market access due to its Free Trade Agreement with China, and lower freight costs for New Zealand, Australian, and West Coast US suppliers.

TheCattleSite News Desk

Top image via Shutterstock

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