Charting Asia’s rise – future trends

By Annie Farrow

The rise of Asia may see an increase in the demand for apples in the next 10 years as consumers become more affluent and incomes increase.

Asiafruit’s Editor John Hey reported at the Asiafruit Congress in September 2015 that the continent will continue to provide outstanding growth for the global fresh produce trade. While Asia is expected to grow more fresh produce to meet local demand, factors such as population growth, aspirations for improved lifestyles and limited land and water resources will further drive imports.

Hey gained insights from the Asiafruit 20th Anniversary Survey which asked Asian fresh fruit business experts and traders about their forecasts for the next 10 years and their views on how big Asia might become. Even in a low economic growth scenario, one view was there would be an increase greater than 35 per cent in the demand for apples over the next 10 years.

When asked about ‘big trends’ over the next 10 years comments from survey respondents included:

  • Big trends: changing channel mix

“E-commerce is growing more rapidly in Asia than in Europe or North America. Online purchases are becoming increasingly important in China. The chief obstacles are trade barriers between Asian countries.”

“E-commerce is going to become a very significant channel for fresh produce. Imported product in particular, especially with issues with provenance and and supply chain efficiency. It will surprise everyone.”

“E-commerce will grow, but will remain only a niche segment of the overall market. Cold chain and logistical challenges add costs that prevent it from becoming more mainstream on a price basis.”

“Unless the e-commerce companies wish to continue to bleed money to develop the business, they eventually need to be profitable and efficient.”

“E-commerce will be an integral part of multi-channel supply. Consumers will still want to see, touch, smell products.”

“There will be several distinct categories of consumers – traditional shoppers who treat shopping as an ‘experience’; those who embrace online shopping for everything; those shop online for dry goods but continue to purchase their fresh goods at retail outlets.”

“The large retail format is losing its attractiveness and will struggle for profitability in the future.”

“Retail development will focus on:

    • Smaller store footprints offering a full range
    • Stores specialising in fresh fruits, often operated by independents (already happening across China)
    • Supplying ready-made, valued-added foods (fresh-processed)
    • Use of digital technology for better understanding of their consumers.”
  • Big trends: producer brands

“Country brands will continue to play a role for market leaders like Chile, New Zealand. However, few fruit exporters have the capacity to establish a company brand in multiple countries like Dole or Zespri have done.”

“Brand development costs money – there are many forms of digital advertising which are relatively cheap however I do not think they will be enough.”

“Branded promotions have strong potential, with regards to food safety, supply consistency, and getting closer to the end-user/consumer.”

“Brands become undermined when “me too” products arrive in the marketplace (fake or close resemblance). Some brands that position themselves very well with consistent quality will succeed, but anyone who doesn’t raise the bar by consistently differentiating themselves from the cheaper competition will ultimately fail. The complex supply chain in Asia doesn’t help.”

  • Big trends: markets to watch

“China will continue to see exciting growth. Chinese perceive fresh fruit as more than just a food. And the transition to a middle-income society still has at least a generation to run.”

“Indonesia is a very populous nation, where many remain on the poverty line. If incomes rise there demand will rise exponentially.”

“India has the best potential in lower-priced produce, China in premium products”

“Korea for fruits, and some vegetables, with access, especially counter-seasonal fruits and cherries, due to rising affluence, good distribution, modern retail and consumer demand.”

“Myanmar for fruits – the market is opening, incomes are rising, traditional and modern retail infrastructure exists and consumers are looking for imported fruits.”

When asked what the keys to success would be over the next ten years some responses included:

“Innovation is important, whether in varieties or convenience. We are very fortunate that fruits and vegetables play such an important role in the Asian diet, and we need to keep reminding them of the benefits.”

“The key to achieving growth is to understand what exactly consumers want, and deliver exactly what they want.”

“Build bilateral and multilateral trade relationships to facilitate market access and investment opportunities.”

“Develop new technology to circumvent the current rigid protocols for the movement of fresh product.”

“Many of the traditional forms of business will disappear, the rate of change will outstrip the past 20 years.”

Source: Charting Asia’s rise: past and future, John Hey presentation, Asiafruit Congress 2015

By |December 8th, 2015|Exporting|

About the Author:

Industry Services Manager at Apple and Pear Australia Ltd (2009-2016).
For information regarding Industry Services contact APAL at or on 03 9329 3511.