The food & agribusiness sector in China will continue to be volatile in 2019, according to the just-released RaboResearch China F&A Outlook 2019.
“Urbanisation and rural upgrading are still providing a base for growth in the service sector and increasing food spend,” according to Ping Chew, Head of RaboResearch Food & Agribusiness – Asia. “But the F&A sector is facing a slowing economy beset with uncertainties and headwinds, including US-China trade negotiations, tightening consumer wallets, weak financial and real estate markets, and manufacturing slowdown.”
“China’s F&A sector is also confronted with potential disruptions from diseases, and ongoing structural changes as a result of industry consolidation, environmental policies, and rapidly changing consumer trends,” says Mr. Chew.
Value upgrading is happening in many sectors, leading to changes in products and business portfolios. Domestic enterprises, especially e-commerce giants and their ecosystems, are beginning to dominate, adding value and becoming a platform of services and products. There is scope for foreign businesses in China but speed, consumer intelligence, smart alliances, as well as identifying core appeal and adapting products will be increasingly important.