Sponsored By
alt text

The China/Aussie axisThe China/Aussie axis

Demand for omega-3s is strong in China, but Australian companies may have advantage

December 1, 2015

2 Min Read
The China/Aussie axis

China represents one of the largest markets for all nutritional supplements, but the Chinese appear to be extremely interested in Omega-3 supplements and “fish oil” products

And it’s not just the category—it’s the country the products came from that are in demand. China, it seems, has developed a taste for Australian goods, with omega-3s a favorite.

     According to research conducted by Euromonitor International, Chinese customers purchased $350 million worth of fish oil/Omega-3 supplements in 2014. Australia, by contrast, consumed just $225 million in that year.  Marketers say Chinese customers are interested in Omega-3 products for infant formula, as well as for joint and heart health. And Chinese consumers, who are extremely wary of their country’s history with counterfeiting, appear to be most interested in brands that are made overseas.

    “Chinese consumers want to see ‘Made in the USA,’ or ‘Made in Australia,’ or “Comes from the Pristine Waters of Norway,’” says Ellen Schutt of GOED. “There’s a lot of documentation that shows that Chinese people aren’t buying their country’s own product.”

    Australian manufacturers could benefit the most from China’s demand, due to proximity and to the China-Australia Free Trade Agreement (ChAFTA), which was signed earlier this year. According to Terri Albert of Australia’s Omega-3 Centre, the previous registration process to enter China was long and complex. With that hurdle largely removed, brands are already repeating success.

    “Companies such as Blackmore’s [vitamins] have already experienced exponential growth in their sales and share prices,” Albert said.

    The going hasn’t been as easy for American brands, which struggle for months or years to receive the green light from the Chinese government. One marketer, who did not want to be named, said his brand has endured a “nightmarish ordeal” in its quest to enter China.

    “It’s expensive, and it’s not unusual for some under-the-table exchange, and that’s not something we want to entertain,”he said. “It’s hard to overcome the fuzzy regulatory framework that’s in place right now.”

    The marketer said American brands have succeeded in the Chinese market by opening up a brick-and-mortar store, rather than distributing through Chinese retail partners. While the method is more expensive, he said, it guarantees a level of brand management that is absent in Chinese retailers.

Subscribe and receive the latest updates on trends, data, events and more.
Join 57,000+ members of the natural products community.

You May Also Like